Location: Ouray County, CO | Metro: Montrose County, CO
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 | $1,080 |
| 1 Bedroom | $1,150 |
| 2 Bedrooms | $1,430 |
| 3 Bedrooms | $1,980 |
| 4 Bedrooms | $2,390 |
| 5 Bedrooms | $2,772 |
| 6 Bedrooms | $3,105 |
| 7 Bedrooms | $3,353 |
| 8 Bedrooms | $3,521 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,150 | $454,078 | 0.25% | F |
| 2BR | $1,430 | $522,760 | 0.27% | F |
| 3BR | $1,980 | $591,763 | 0.33% | F |
| 4BR | $2,390 | $768,038 | 0.31% | F |
| 5BR | $2,772 | $916,172 | 0.3% | F |
U.S. Census Bureau data (2024)
The Section 8 housing market in ZIP code 81403, encompassing Montrose, CO, and parts of Montrose and Ouray Counties, presents a unique opportunity for real estate investors. According to HUD Fair Market Rent (FMR) data for fiscal year 2026, the FMR for the area is set at $1,460 per month. This figure is slightly above the market rent average of $1,369 as reported by the Census Bureau's American Community Survey (ACS).
The comparison between the FMR and the actual market rent indicates that voucher tenants can provide positive cash flow for landlords and small-portfolio investors. However, the cash flow is marginal, suggesting that landlords will need to manage their properties efficiently to ensure profitability. Premium units or those with additional amenities might offer a better cash flow potential due to higher rental rates.
To further analyze the investment potential, consider the median home value in the area, which stands at $600,786. The rent-to-price ratio, calculated using the market rent figure, is approximately 0.23%. This ratio suggests that the rental income generated from properties in this area is relatively low compared to the property values. However, it also implies that the market is primarily driven by homeownership rather than renting, which can contribute to long-term stability and potentially lower vacancy rates.
The dynamics of the local real estate market, including days on market (DOM) and price-cut shares, do not significantly impact the rent-vs-buy decision. The median DOM is listed as N/A, indicating limited data availability, while the median price-cut share is a mere 0.1%, suggesting that homes rarely go on sale at reduced prices. These factors point towards a stable market where property values are likely to remain consistent over time.
In conclusion, the strongest investor angle in ZIP 81403 is stability. With marginal cash flow from voucher tenants and a high median home value, the focus should be on securing long-term, stable rental income rather than rapid appreciation or significant monthly profits. This makes it an ideal location for investors seeking a steady, reliable investment portfolio.
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.