Section 8 Fair Market Rent (FMR) for ZIP 78748 - 2027

Investment Score for ZIP 78748

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,520
1 Bedroom	$1,610
2 Bedrooms	$1,910
3 Bedrooms	$2,410
4 Bedrooms	$2,830
5 Bedrooms	$3,283
6 Bedrooms	$3,677
7 Bedrooms	$3,971
8 Bedrooms	$4,170

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,910	$306,898	0.62%	D
3BR	$2,410	$391,520	0.62%	D
4BR	$2,830	$468,736	0.6%	D
5BR	$3,283	$584,270	0.56%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 78748 (Austin, TX) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 78748 is set by HUD for the year 2026. For a two-bedroom apartment, the FMR is $2050, which represents 21.4% of the median household income of $115,213. This indicates that the FMR is relatively affordable compared to the overall income levels in the area. However, it's important to note that the actual rents in the market can be significantly higher. The Zillow median price for a two-bedroom property is $310,135, which translates to a monthly rent of approximately $1292 if we assume a typical rental yield of 5%. Given the Price-to-FMR ratio of 12.6x, it’s clear that the actual rents far exceed the FMR. This creates a significant constraint for voucher holders. They might struggle to find properties that accept their vouchers due to the high cost of housing relative to the FMR. Additionally, landlords who do accept vouchers may face challenges in covering their costs, given the disparity between the FMR and the actual market rent. #### Affordability & Renter Profile ZIP code 78748 has a population of 55,631, with 43.3% being renters. This suggests a substantial demand for rental properties. The occupancy rate of 95.5% further supports the idea that the market is tight, with very few vacant units available. Given the median household income of $115,213, most residents are likely middle to upper-middle class professionals, possibly working in tech, healthcare, or other high-paying industries prevalent in Austin. Despite the high income levels, the rent-to-income ratio for a two-bedroom unit at the FMR is only 17.8%, indicating that the FMR is indeed affordable for many residents. However, the actual market rents are much higher, making housing less accessible for lower-income individuals without subsidies. This tight market condition means that competition for rental units is fierce, and those relying solely on Section 8 vouchers will have limited options. #### Investor Angle From an investor perspective, the ZIP code 78748 presents a challenging scenario when focusing on Section 8 properties. The FMR for a two-bedroom unit is $2050, but the actual market rent for such a unit would likely be much higher. Assuming a typical market rent of $1292 based on the Zillow median price, an investor would need to ensure that the property is priced close to the FMR to attract Section 8 tenants. However, the high market prices suggest that the actual rent could be closer to $2000-$2500 per month, depending on the location and amenities. At these rates, the difference between the FMR and the actual rent would be substantial, potentially leading to negative cash flow unless the investor can secure additional subsidies or manage the property efficiently to reduce costs. The investment grade for this ZIP code would be considered moderate to low for Section 8-focused investments due to the high market rents and the potential difficulty in finding properties that accept vouchers. Investors should carefully consider the risks and returns before entering this market. #### Specific Actionable Insights 1. **Focus on Affordable Units**: Investors should target properties that are already priced near the FMR to minimize the risk of negative cash flow. A two-bedroom unit priced at around $2050 would be ideal, as it aligns closely with the FMR and would be more likely to attract Section 8 tenants. 2. **Seek Additional Subsidies**: Given the high market rents, investors might want to explore additional subsidies or programs that can help bridge the gap between the FMR and the actual market rent. This could include state or local assistance programs designed to support affordable housing. 3. **Location Matters**: Within ZIP code 78748, certain neighborhoods might offer better opportunities for Section 8-focused investments. Areas with lower market rents or higher concentrations of subsidized housing could provide more favorable conditions for positive cash flow. #### Bottom Line Given the high market rents and the tightness of the rental market, the recommendation for Section 8-focused investors in ZIP code 78748 is to **Skip**. The significant disparity between the FMR and actual market rents makes it difficult to achieve positive cash flow, and the limited availability of units that accept vouchers reduces the attractiveness of this ZIP code for such investments. Investors should consider areas with lower market rents or higher concentrations of subsidized housing to maximize their chances of success.

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.