Location: San Antonio-New Braunfels, TX | Metro: San Antonio-New Braunfels, TX HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,650 |
| 1 Bedroom | $1,790 |
| 2 Bedrooms | $2,160 |
| 3 Bedrooms | $2,790 |
| 4 Bedrooms | $3,240 |
| 5 Bedrooms | $3,758 |
| 6 Bedrooms | $4,209 |
| 7 Bedrooms | $4,546 |
| 8 Bedrooms | $4,773 |
U.S. Census Bureau data (2024)
The analysis for ZIP code 78236 provides insight into the potential returns for landlords and small-portfolio investors considering Section 8 properties. The Fair Market Rent (FMR) for a 2-bedroom apartment in this area, for fiscal year 2024, is set at an annualized rate of $2190. Meanwhile, the market rent based on the latest Census ACS data stands at $2,188 annually.
Given the median home value is not available for ZIP 78236, we can still derive a rough cap-rate picture using the annualized rents. The implied gross yield for a Section 8 property would be calculated using the FMR, while the market rent provides a benchmark for comparison. For a property with a median home value that is not available, we cannot directly compute a precise cap rate without knowing the purchase price. However, we can infer that the yields will be close since the FMR and market rent figures are nearly identical.
In ZIP 78236, the high renter density of 97.7% suggests a robust demand for rental properties. This statistic indicates that the majority of residents are likely to be renters, which supports the viability of both Section 8 and market-rate rental strategies. With the days on market (DOM) also not specified, it's challenging to determine the exact turnover rates, but the strong rental demand implies that properties should not remain vacant for long periods.
When comparing the two scenarios, the gross yield from Section 8 properties, based on the FMR, will closely mirror the gross yield from market-rate rentals, given the similarity in annual rents. For landlords, this means that the choice between Section 8 and market-rate rentals largely comes down to the stability of income versus the potential for higher yields, though the difference in ZIP 78236 appears minimal.
Despite the lack of specific median home value and DOM data, the high renter density makes it clear that there is significant opportunity in the rental market. Investors should consider the reliability of Section 8 payments, which are guaranteed by the government, against the possibility of slightly higher market rents if the demand persists. Given the circumstances, the Section 8 scenario offers a safer bet with yields that are nearly equivalent to those from market-rate rentals.
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.