Location: Austin-Round Rock-San Marcos, TX | Metro: Austin-Round Rock-San Marcos, 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 | $1,510 |
| 1 Bedroom | $1,590 |
| 2 Bedrooms | $1,890 |
| 3 Bedrooms | $2,380 |
| 4 Bedrooms | $2,800 |
| 5 Bedrooms | $3,248 |
| 6 Bedrooms | $3,638 |
| 7 Bedrooms | $3,929 |
| 8 Bedrooms | $4,125 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,590 | $183,710 | 0.87% | C |
| 2BR | $1,890 | $277,785 | 0.68% | D |
| 3BR | $2,380 | $394,320 | 0.6% | D |
| 4BR | $2,800 | $546,779 | 0.51% | F |
| 5BR | $3,248 | $833,804 | 0.39% | F |
U.S. Census Bureau data (2024)
Lago Vista, TX, located in ZIP code 78645 within the Austin-Round Rock-San Marcos, TX MSA metro area, is best suited as an appreciation play within a Section 8 portfolio strategy. The key indicators supporting this classification include a low 0.2% price-cut share and a relatively long 111-day days on market (DOM).
The median Fair Market Rent (FMR) for ZIP 78645 in fiscal year 2024 is set at $1960, which is below the market rent of $2,145. This means that landlords participating in the Section 8 program will receive slightly less than the market rate, resulting in a $185 shortfall per unit. However, this spread is manageable given the overall stability and growth potential of the area.
A critical factor in identifying Lago Vista as an appreciation play is the low price-cut share. With only 0.2% of properties needing to be discounted to sell, it indicates a strong demand for housing in the area without significant competition among sellers. Additionally, the 111-day DOM suggests that while homes take longer to sell compared to more active markets, they are still selling, indicating steady interest and appreciation over time.
The median income in Lago Vista is $113,008, reflecting a higher-than-average earning demographic. This contributes to the area's desirability and supports the notion that property values are likely to appreciate. While the renter share stands at 9.2%, this does not detract from the appreciation potential since the majority of residents are homeowners who benefit from rising property values.
To summarize, Lago Vista, TX, is an ideal appreciation play for a Section 8 portfolio due to its low price-cut share, long but stable DOM, and high median income levels. Despite the slight difference between the FMR and market rent, the overall economic conditions and demand for housing support long-term investment and growth.
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.