Location: McMullen County, TX | Metro: La Salle County, TX
| Unit Size | Monthly FMR |
|---|---|
| Studio | $820 |
| 1 Bedroom | $860 |
| 2 Bedrooms | $1,080 |
| 3 Bedrooms | $1,290 |
| 4 Bedrooms | $1,560 |
| 5 Bedrooms | $1,810 |
| 6 Bedrooms | $2,027 |
| 7 Bedrooms | $2,189 |
| 8 Bedrooms | $2,298 |
U.S. Census Bureau data (2024)
The analysis of the Section 8 cap-rate scenario for ZIP code 78021 reveals two distinct possibilities based on the available data.
First, let's consider the scenario using the annualized Fair Market Rent (FMR) for a 2-bedroom apartment, which is set at $1,020 per month for fiscal year 2026. This figure represents the maximum rental assistance payment for the area. However, without the median home value, we cannot calculate an exact cap rate. Instead, we can discuss the implied gross yield. If we assume a property value of $250,000 for simplicity, the annual rental income would be $12,240. This translates to an implied gross yield of 4.9%. While this is a theoretical calculation, it provides a baseline for understanding potential returns in the context of Section 8 rental assistance.
Second, examining the market rent scenario, the lack of specific market rent data for ZIP 78021 means we cannot directly compare it to the FMR scenario. However, the absence of market rent data suggests that there might be limited conventional rental activity in this area, possibly due to low renter density. The 0.0% renter density indicates that homeownership is predominant, which could impact the demand for rental properties, including those participating in the Section 8 program. Additionally, the day-on-market (DOM) data being listed as N/A implies either very little turnover in rental properties or a lack of comprehensive data on rental listings.
Given these factors, the FMR-based scenario appears more realistic for calculating potential returns through Section 8 participation. The implied gross yield of 4.9%, while modest, reflects a stable and government-backed income stream. Landlords and small-portfolio investors should weigh this stability against the potentially lower yields compared to market rents in areas with higher renter density.
In conclusion, for ZIP 78021, the Section 8 cap-rate analysis leans towards an implied gross yield of 4.9% based on the 2BR FMR. This scenario offers a clearer path for investment planning, despite the limitations in market rent and median home value data.
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.