Section 8 Fair Market Rent (FMR) for ZIP 80916 - 2027

Investment Score for ZIP 80916

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	$1,090
1 Bedroom	$1,330
2 Bedrooms	$1,560
3 Bedrooms	$2,160
4 Bedrooms	$2,480
5 Bedrooms	$2,877
6 Bedrooms	$3,222
7 Bedrooms	$3,480
8 Bedrooms	$3,654

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	$1,560	$241,879	0.64%	D
3BR	$2,160	$337,432	0.64%	D
4BR	$2,480	$378,034	0.66%	D
5BR	$2,877	$413,467	0.7%	D

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 80916 (Colorado Springs, CO) #### Section 8 Voucher Dynamics In ZIP code 80916, the Fair Market Rent (FMR) for a two-bedroom unit is set at $1650 per month. This figure represents 29.5% of the median household income of $67,127, which suggests that it is reasonably aligned with the financial capabilities of residents. However, the actual rent charged by landlords can vary significantly from the FMR. For instance, if the average rent for a two-bedroom unit exceeds $1650, Section 8 voucher holders would face difficulties finding suitable housing within their budget. The voucher program typically covers a portion of the rent, but tenants must contribute the difference, which is capped at 40% of their adjusted income. In this case, a tenant with the median income would have to pay $2685.08 annually towards rent, which is approximately $223.76 per month. If the actual rent is higher than $1650, the gap would need to be covered by the tenant, potentially making it unaffordable. #### Affordability & Renter Profile The ZIP code has a significant rental population, with 45.7% of households being renters. This indicates a strong demand for rental properties. The occupancy rate of 96.1% suggests that the rental market is relatively tight, with few vacant units available. Given the high percentage of renters and the near-full occupancy, it is likely that many residents are competing for limited rental options. The median household income of $67,127 implies that the majority of renters are middle-class individuals who may struggle to find affordable housing, especially if they rely on Section 8 vouchers. The FMR for a two-bedroom unit is $1650, which is a critical benchmark for affordability. If rents exceed this amount, the market becomes less accessible to lower-income households. #### Investor Angle From an investor perspective, the price-to-FMR ratio of 12.6x for a two-bedroom unit indicates that the purchase price ($249,039) is significantly higher than the monthly rent ($1650). This ratio suggests that the market is highly valued, and investors should carefully consider the potential for cash flow. To determine if this ZIP code is cash-flow positive at FMR, we need to calculate the expected rental income against the mortgage payment. Assuming a typical mortgage interest rate of 5%, the monthly mortgage payment for a $249,039 property would be around $1250. Adding property taxes, insurance, and maintenance costs, the total monthly expenses could range from $1500 to $1700. Therefore, even if a landlord charges the FMR of $1650, the property might not generate positive cash flow without additional subsidies or cost efficiencies. The investment grade in this ZIP code would be considered moderate to low due to the high price-to-FMR ratio and the potential challenges in attracting tenants who can afford the rent. Investors should also consider the local vacancy rates and competition from other rental properties when evaluating the feasibility of investing in this area. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should consider smaller units such as one-bedroom apartments, which have an FMR of $1390. This can help ensure that the rental income is closer to covering the mortgage and other expenses. For example, a one-bedroom unit purchased at the Zillow median price of $249,039 would have a mortgage payment of about $1250, leaving room for positive cash flow if the actual rent is close to the FMR. 2. **Utilize Section 8 Subsidies**: Investors should leverage the Section 8 voucher program to fill vacancies. Although the FMR for a two-bedroom unit is $1650, the actual rent charged could be higher. By accepting Section 8 vouchers, landlords can ensure a steady stream of income while providing affordable housing options to eligible tenants. However, they should be aware that the tenant contribution towards rent is capped at 40% of their adjusted income, so the total rent received will not exceed $1650 unless the tenant’s income is above the median. #### Bottom Line For investors focusing on Section 8 properties, the recommendation for ZIP code 80916 is to **Skip**. The high price-to-FMR ratio and the tight rental market make it challenging to achieve positive cash flow without significant subsidies. Additionally, the median household income suggests that many potential tenants might struggle to meet the required contribution towards rent, leading to higher vacancy risks. Investors should look for areas with a more favorable price-to-FMR ratio and a larger pool of eligible Section 8 tenants to ensure better returns and stability.

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.