Location: Houston-The Woodlands-Sugar Land, TX | Metro: Houston-The Woodlands-Sugar Land, TX HUD Metro FMR Area
Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,110 |
| 1 Bedroom | $1,140 |
| 2 Bedrooms | $1,350 |
| 3 Bedrooms | $1,820 |
| 4 Bedrooms | $2,260 |
| 5 Bedrooms | $2,622 |
| 6 Bedrooms | $2,937 |
| 7 Bedrooms | $3,172 |
| 8 Bedrooms | $3,331 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,350 | $135,427 | 1% | C |
| 3BR | $1,820 | $231,721 | 0.79% | D |
| 4BR | $2,260 | $287,021 | 0.79% | D |
U.S. Census Bureau data (2024)
The Section 8 market in ZIP code 77591, Texas City, TX, within Galveston County and part of the Houston-The Woodlands-Sugar Land, TX HUD Metro FMR Area, presents a unique opportunity for landlords and small-portfolio investors. The HUD Fair Market Rent (FMR) for the area is set at $1240 for the fiscal year 2024, which is notably lower than the market rent, as indicated by Zillow's ZORI (Zillow Observed Rent Index), currently at $1,611. This disparity means that landlords accepting Section 8 vouchers will generally experience negative cash flow when renting properties at the HUD FMR rate. However, there are strategies to mitigate this impact.
To understand the financial dynamics, consider the median home value in the area, which stands at $239,770. This figure can be used to derive a rent-to-price ratio, offering insight into how rental income compares to property values. A simple calculation reveals that the annual rent at ZORI rates amounts to approximately 7.5% of the median home value. This suggests that while cash flow might be tight at the HUD FMR rate, the overall investment remains relatively stable compared to property values.
The situation regarding days on market (DOM) and price-cut shares is less relevant for rental decisions but worth noting. With a median DOM marked as N/A and a price-cut share of just 0.3%, it indicates that the housing market is moving quickly without significant price adjustments. For investors focused on rental properties, this suggests a strong demand for housing, which can indirectly support rental rates and occupancy levels.
In summary, voucher tenants in ZIP 77591 will only achieve positive cash flow with premium units or through strategic cost management. Given the tight rent-to-price ratio and the robust housing demand, the strongest investor angle here is stability. Investors can expect consistent demand and minimal risk of vacancy, making this area an attractive choice for those prioritizing steady, reliable returns over high cash flow or rapid appreciation.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-08-31). 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.