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 | $1,330 |
| 1 Bedroom | $1,410 |
| 2 Bedrooms | $1,670 |
| 3 Bedrooms | $2,120 |
| 4 Bedrooms | $2,490 |
| 5 Bedrooms | $2,888 |
| 6 Bedrooms | $3,235 |
| 7 Bedrooms | $3,494 |
| 8 Bedrooms | $3,669 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $2,120 | $245,966 | 0.86% | C |
U.S. Census Bureau data (2024)
The analysis of ZIP code 78656, located within the Austin-Round Rock-San Marcos, TX MSA metro area, reveals key insights into its potential as an investment opportunity for landlords and small-portfolio investors.
The first question addresses whether the rent math works. The Fair Market Rent (FMR) for ZIP 78656 in fiscal year 2024 is set at $1,470. In comparison, the market rent as measured by Zillow's Observed Rental Index (ZORI) stands at $1,739. This indicates that landlords can potentially charge above the FMR, thereby making the rent math favorable for those who can secure tenants willing to pay the higher market rate.
Regarding the affordability of acquisition, the median home value in ZIP 78656 is $261,412. The lack of available data on days on market (DOM) and the fact that only 0.2% of homes have been subject to price cuts suggest a stable housing market where homes are typically sold close to their asking price. However, without specific DOM data, it is challenging to assess how quickly homes can be acquired and put into rental use.
Tenant demand is another critical factor. With a population of 2,847, the renter share is 30.8%, translating to approximately 875 renters. While the number of potential tenants is relatively low, the demand for rental properties is strong enough to support a modest portfolio of rental units.
Verdict: ZIP 78656 presents a viable investment opportunity for those interested in the Austin-Round Rock-San Marcos, TX MSA market. The ability to charge rents above the FMR suggests profitability, assuming market conditions hold steady. Acquisition costs are reasonable, with a median home value of $261,412, though the lack of DOM data introduces some uncertainty. Tenant demand, while not overwhelming, is sufficient to sustain a small rental portfolio. Overall, the combination of favorable rent pricing and a stable housing market makes 78656 a promising area for real estate investment.
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.