Location: Denver-Aurora-Centennial, CO | Metro: Denver-Aurora-Centennial, CO 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 | $1,480 |
| 1 Bedroom | $1,580 |
| 2 Bedrooms | $1,890 |
| 3 Bedrooms | $2,470 |
| 4 Bedrooms | $2,750 |
| 5 Bedrooms | $3,190 |
| 6 Bedrooms | $3,573 |
| 7 Bedrooms | $3,859 |
| 8 Bedrooms | $4,052 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,890 | $566,337 | 0.33% | F |
| 3BR | $2,470 | $665,244 | 0.37% | F |
| 4BR | $2,750 | $814,458 | 0.34% | F |
U.S. Census Bureau data (2024)
The Section 8 cap rate scenario for ZIP 80117 (Kiowa, CO) can be analyzed using the Fair Market Rent (FMR) and market rent figures provided. With an annualized 2BR FMR of $1710 for FY 2024, and a market rent of $1,217 based on Census ACS data, we can calculate the gross yield for both situations.
First, let's consider the gross yield based on the FMR. The annual rental income at the FMR would be $1710 multiplied by 12, which equals $20,520. Dividing this figure by the median home value of $696,144 gives us an implied gross yield of approximately 2.94%. This calculation assumes that the property would be rented out at the FMR year-round without any vacancy periods.
Next, let's look at the gross yield based on the market rent. At $1,217 per month, the annual rental income would be $14,604. When this amount is divided by the median home value of $696,144, the implied gross yield drops to about 2.09%. This scenario reflects the actual rental rates in the area, as reported by the Census Bureau.
Given the low renter density of 7.1%, it is important to note that the likelihood of finding a steady stream of tenants willing to pay the FMR is slim. The high median home value also suggests that the majority of properties in this ZIP code are owner-occupied, further reducing the number of potential rental units. The N/A-day DOM (days on market) indicates that there is insufficient data to determine how quickly rental properties are typically leased in this area, adding another layer of uncertainty.
Considering these factors, the gross yield based on the market rent of 2.09% is more realistic for ZIP 80117. While the FMR-based yield of 2.94% might seem attractive, it does not reflect the actual rental environment in Kiowa, CO. Investors should focus on the market rent yield when evaluating potential returns, as it provides a more accurate representation of the rental market conditions.
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.