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: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,410 | $250,308 | 0.56% | F |
| 2BR | $1,670 | $562,938 | 0.3% | F |
| 3BR | $2,120 | $812,435 | 0.26% | F |
| 4BR | $2,490 | $1,177,512 | 0.21% | F |
U.S. Census Bureau data (2024)
The ZIP code 78756 in Austin, TX, presents a unique challenge for renters given the economic landscape. The median income for households in this area stands at $94,701 annually. When compared to the market rate rent of $1,633 per month (ZORI), it becomes evident that many renters struggle to find affordable housing. This figure represents approximately 20% of the annual median income, which is a significant portion of a household's budget.
Further complicating the situation is the Federal Market Rate (FMR) for the ZIP code, set at $1,870 for fiscal year 2024. This standard is used to determine the maximum allowable rent for Section 8 vouchers. The FMR is higher than the ZORI, indicating that voucher holders have slightly more purchasing power in the rental market. However, the difference between the ZORI and FMR is minimal, suggesting that even with a voucher, finding affordable housing remains challenging.
In ZIP 78756, 57.0% of the 9,197 residents are renters. This high percentage of renters competing for limited housing stock creates intense competition among potential tenants. Landlords must be strategic in their approach to maximize occupancy and profitability.
For landlords considering whether to accept voucher tenants or focus on cash-paying renters, the data points to a nuanced decision. Accepting voucher payments ensures a steady stream of income, albeit at a fixed rate that may not fully reflect market conditions. Cash-paying tenants might offer higher rents but come with the risk of vacancy due to the high cost of living relative to income levels.
A strong strategy for landlords would be to balance their portfolio by accepting a mix of voucher and cash-paying tenants. This diversification helps mitigate risks associated with both high tenant turnover and potential vacancies. Given the affordability gap and the competitive nature of the rental market, landlords who can offer flexible options will likely fare better in attracting and retaining tenants.
Ultimately, landlords in ZIP 78756 should prepare for a market where affordability is a critical concern. By understanding the financial constraints faced by local renters and the support offered through housing vouchers, landlords can position themselves to attract a stable tenant base and navigate the complexities of the Austin rental market effectively.
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.