Location: Deaf Smith County, TX | Metro: Oldham County, TX HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $790 |
| 1 Bedroom | $890 |
| 2 Bedrooms | $1,100 |
| 3 Bedrooms | $1,490 |
| 4 Bedrooms | $1,650 |
| 5 Bedrooms | $1,914 |
| 6 Bedrooms | $2,144 |
| 7 Bedrooms | $2,316 |
| 8 Bedrooms | $2,432 |
U.S. Census Bureau data (2024)
The analysis of the Section 8 cap-rate scenario for ZIP code 79001 reveals interesting insights for landlords and small-portfolio investors. The Fair Market Rent (FMR) for a 2-bedroom apartment in this area for FY 2024 is set at $1010 per month. This translates into an annualized income of $12,120. Given the median home value is not available, we must rely on other metrics to assess the potential yield.
Using the Census ACS data, the market rent for a similar 2-bedroom property stands at $1,100 per month, which annualizes to $13,200. These figures provide us with two different gross yields when compared to the median home value. However, since the median home value is not provided, we cannot calculate the exact gross yield percentages. Instead, we can compare the monthly rents directly to understand the relative attractiveness of each scenario.
The implied gross yield based on the FMR of $1010 is lower than that of the market rent at $1,100. This means that properties rented through Section 8 would generate less income annually compared to those rented at market rates. Given the renter density of 28.4%, it's important to consider the likelihood of finding tenants willing to pay market rates versus those who qualify for Section 8 assistance.
The days on market (DOM) being not available makes it difficult to gauge how quickly a property might be leased under either scenario. However, with a higher proportion of renters in the area, landlords should weigh the benefits of steady, government-backed rental income against potentially faster leasing at market rates.
In conclusion, while the exact gross yield cannot be calculated without the median home value, the direct comparison of monthly rents indicates that renting at market rates of $1,100 offers a higher income potential than the Section 8 rate of $1010. Landlords should consider the trade-offs between the stability of Section 8 tenancy and the higher income from market-rate rentals.
Data Sources: FMR data from HUD (2027). 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.