Location: McAllen-Edinburg-Mission, TX | Metro: McAllen-Edinburg-Mission, TX MSA
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 | $800 |
| 1 Bedroom | $800 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,310 |
| 4 Bedrooms | $1,440 |
| 5 Bedrooms | $1,670 |
| 6 Bedrooms | $1,870 |
| 7 Bedrooms | $2,020 |
| 8 Bedrooms | $2,121 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $800 | $91,958 | 0.87% | C |
| 2BR | $1,010 | $110,411 | 0.91% | C |
| 3BR | $1,310 | $161,622 | 0.81% | C |
| 4BR | $1,440 | $244,705 | 0.59% | F |
U.S. Census Bureau data (2024)
ZIP 78538 (Edcouch, TX, McAllen-Edinburg-Mission, TX MSA metro) is best suited as a cash-flow anchor within a Section 8 portfolio strategy. The Fair Market Rent (FMR) for a two-bedroom apartment in this ZIP code for fiscal year 2024 is $930, while the market rent is estimated at $556. This significant spread of $374 indicates that landlords can expect a reliable and consistent cash flow when participating in the Section 8 program.
The median home value in ZIP 78538 is $151,750, which further supports the notion that this area is ideal for cash flow rather than appreciation. With a low 0.2% price-cut share and an N/A-day DOM (days on market), it suggests that the rental market is relatively stable and there is little need for frequent adjustments to rental rates.
While the 27.1% renter share and median income of $40,399 indicate a moderate level of renters, these factors do not outweigh the strong cash flow potential offered by the substantial difference between FMR and market rent. Landlords should focus on the guaranteed rental income provided by the Section 8 program in this ZIP code, ensuring steady returns on investment.
To summarize, ZIP 78538 is a solid choice for a cash-flow anchor due to the high FMR compared to market rent, making it an attractive option for landlords and small-portfolio investors looking to stabilize their rental income.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.