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 | $1,420 |
| 1 Bedroom | $1,500 |
| 2 Bedrooms | $1,780 |
| 3 Bedrooms | $2,250 |
| 4 Bedrooms | $2,630 |
| 5 Bedrooms | $3,051 |
| 6 Bedrooms | $3,417 |
| 7 Bedrooms | $3,690 |
| 8 Bedrooms | $3,875 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,500 | $275,329 | 0.54% | F |
| 2BR | $1,780 | $420,442 | 0.42% | F |
| 3BR | $2,250 | $910,814 | 0.25% | F |
| 4BR | $2,630 | $1,305,580 | 0.2% | F |
| 5BR | $3,051 | $1,705,642 | 0.18% | F |
U.S. Census Bureau data (2024)
The analysis for Section 8 properties in ZIP code 78731, located in Austin, Texas, reveals a significant gap between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR stands at $1930, while the market rent, as measured by ZORI, is $1496. This means that landlords can receive a subsidy of $434 per month, which is a 29% premium over the market rate.
In Austin, where 46.9% of residents are renters, the median home value is $1,019,270 and the median income is $105,494. The disparity between the FMR and market rent in ZIP 78731 suggests that voucher tenants provide an opportunity for higher yields compared to open-market rental rates. Landlords who accept Section 8 vouchers can capitalize on this subsidy to achieve better financial returns on their investments.
However, accepting housing vouchers also comes with its own set of costs and considerations. Landlords must comply with HUD regulations and undergo regular inspections, which can be time-consuming. Additionally, the process of qualifying for the program and managing voucher tenants might require more administrative effort than renting to market-rate tenants. Despite these challenges, the financial benefit of receiving the higher FMR subsidy makes it an attractive option for many landlords and small-portfolio investors looking to maximize their rental income.
To summarize, the $434 monthly subsidy, representing a 29% premium over the market rent, makes ZIP 78731 a favorable location for Section 8 properties. In the broader context of Austin's rental market, this premium can significantly enhance the yield for landlords and investors, especially given the city’s high median home values and incomes.
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.