Section 8 Fair Market Rent (FMR) for ZIP 78753 - 2027

Investment Score for ZIP 78753

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	$1,370
1 Bedroom	$1,450
2 Bedrooms	$1,720
3 Bedrooms	$2,170
4 Bedrooms	$2,550
5 Bedrooms	$2,958
6 Bedrooms	$3,313
7 Bedrooms	$3,578
8 Bedrooms	$3,757

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	$1,720	$258,957	0.66%	D
3BR	$2,170	$347,437	0.62%	D
4BR	$2,550	$407,537	0.63%	D
5BR	$2,958	$432,512	0.68%	D

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 78753 (Austin, TX) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) figures for ZIP code 78753 in Austin, Texas, provide a benchmark for rental costs that are eligible under the Section 8 housing voucher program. For 2026, the FMRs are as follows: - 0BR: $1400 - 1BR: $1490 - 2BR: $1760 (which is 32.4% of the median household income) - 3BR: $2240 - 4BR: $2600 These figures represent the maximum amount that a landlord can charge for a unit to be considered affordable under the Section 8 program. However, comparing these FMRs to actual market rents reveals significant disparities. The Zillow median price for a 2BR property in this area is $266,309, which translates to a monthly mortgage payment of approximately $1,260 if financed at a 4.5% interest rate over 30 years. This figure does not include property taxes, insurance, maintenance, and other expenses, which would likely push the total cost above the FMR of $1760. Given that the FMRs are lower than the typical market rents, voucher holders face several constraints. They must find landlords willing to accept Section 8 vouchers, which can be challenging due to the administrative burden and potential delays in payment. Additionally, the limited budget available through the vouchers means that voucher holders are restricted to a smaller pool of properties that meet the affordability criteria. #### Affordability & Renter Profile ZIP code 78753 has a population of 56,920, with 66.6% of residents being renters. This high percentage indicates a strong demand for rental properties, suggesting that the market is relatively tight. The occupancy rate of 95.7% further supports this conclusion, as it shows that nearly all units are occupied, leaving little room for vacancy. The median household income in the area is $65,170, which places a significant portion of the population in a moderate-income bracket. Given that the FMR for a 2BR unit is $1760, which represents 32.4% of the median income, it is clear that many residents struggle with housing affordability. This tight market and high renter percentage make it difficult for low-income individuals to find suitable housing without assistance like Section 8 vouchers. #### Investor Angle From an investor perspective, the key question is whether the FMRs allow for cash flow-positive investments. Based on the Zillow median price for a 2BR property of $266,309, the monthly mortgage payment would be around $1,260. Adding typical property expenses such as property taxes (estimated at $1,000 annually), insurance ($100 per month), and maintenance ($100 per month), the total monthly cost would be approximately $1,460. This total cost is slightly below the FMR of $1760 for a 2BR unit, indicating that it could be possible to achieve a small positive cash flow. However, the price-to-FMR ratio of 12.6x suggests that the market value of properties is significantly higher than what is considered affordable under the Section 8 program. This high ratio implies that there is a substantial gap between the market value of properties and the rents that can be charged to voucher holders. In terms of investment grade, the high renter percentage and occupancy rate suggest that the demand for rental properties is robust. However, the tight market conditions and the need to find properties that fit within the FMR guidelines present challenges. Investors should carefully consider the administrative requirements and potential delays associated with accepting Section 8 vouchers before committing to this market. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should focus on acquiring smaller units such as 0BR and 1BR properties. These units have FMRs of $1400 and $1490, respectively, which are closer to the actual market rents for similar-sized units. This strategy can help ensure that the investment remains cash flow positive while still meeting the needs of voucher holders. 2. **Consider Properties Below Market Value**: While the Zillow median price for a 2BR property is $266,309, investors should look for properties that are priced below this level. A property priced at $220,000, for example, would have a monthly mortgage payment of about $1,050, allowing for a higher margin when renting at the FMR of $1760. This approach can help mitigate the risk of negative cash flow and improve the overall investment performance. 3. **Engage with Local Housing Authorities**: To navigate the complexities of the Section 8 program, investors should engage with local housing authorities to understand the specific requirements and processes involved. This engagement can also help in identifying areas where there is a higher concentration of voucher holders, potentially increasing the likelihood of finding tenants. #### Bottom Line For Section 8-focused investors, the ZIP code 78753 presents both opportunities and challenges. The high demand for rental properties and the robust occupancy rate make it an attractive market. However, the high price-to-FMR ratio and the need to find properties that fit within the FMR guidelines present significant hurdles. **Recommendation**: **Hold**. Investors should hold off on making large-scale investments in this market until they can identify specific opportunities that align with the FMR guidelines and offer positive cash flow. Engaging with local housing authorities and focusing on smaller units can help mitigate some of the risks associated with this market.

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.