Location: Matagorda County, TX | Metro: Matagorda County, TX
| Unit Size | Monthly FMR |
|---|---|
| Studio | $930 |
| 1 Bedroom | $950 |
| 2 Bedrooms | $1,130 |
| 3 Bedrooms | $1,440 |
| 4 Bedrooms | $1,790 |
| 5 Bedrooms | $2,076 |
| 6 Bedrooms | $2,325 |
| 7 Bedrooms | $2,511 |
| 8 Bedrooms | $2,637 |
U.S. Census Bureau data (2024)
The analysis of the Section 8 cap-rate picture for ZIP code 77419 hinges on the Federal Market Rent (FMR) and the median home value. For a two-bedroom unit, the annualized FMR for FY 2026 in the metropolitan area is $1,120 per month. This translates into an annual rental income of $13,440. Given the median home value in the area is $211,252, we can calculate the implied gross yield under the Section 8 scenario.
To find the gross yield, divide the annual rental income by the property value. In this case, the gross yield would be approximately 6.36%. However, this calculation assumes that the entire median home value is the investment cost, which might not be accurate as it does not account for factors such as financing costs, property taxes, insurance, and maintenance expenses.
Considering the market rent is listed as N/A, it's challenging to provide a direct comparison. Typically, market rents reflect what tenants are willing to pay without government subsidies, and they often exceed FMRs. If we were to assume a reasonable market rent figure based on comparable areas, the gross yield would likely be higher than the 6.36% derived from the Section 8 scenario.
The renter density in ZIP 77419 is 2.3%, which suggests a relatively low demand for rental properties compared to owner-occupied homes. This low density could affect the feasibility of relying solely on Section 8 tenants for occupancy. Additionally, the Days on Market (DOM) being listed as N/A indicates a lack of data regarding how quickly properties are rented out, which is crucial for assessing the liquidity and turnover rates of rental investments.
In conclusion, while the Section 8 scenario provides a stable, if lower, gross yield of 6.36%, the absence of market rent data makes it difficult to assess the potential for higher returns through market rentals. Investors should consider the implications of the low renter density and the need for reliable DOM data when evaluating the viability of either investment strategy in ZIP 77419.
Data Sources: FMR data from HUD (2027). Demographics from U.S. Census (2024).
About FMR: Fair Market Rent (FMR) is used to determine payment standards for the Section 8 Housing Choice Voucher program, initial renewal rents for some expiring project-based Section 8 contracts, and rent ceilings for HOME Investment Partnerships.