Location: Grand Junction, CO | Metro: Grand Junction, 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 | $1,110 |
| 1 Bedroom | $1,260 |
| 2 Bedrooms | $1,590 |
| 3 Bedrooms | $2,200 |
| 4 Bedrooms | $2,660 |
| 5 Bedrooms | $3,086 |
| 6 Bedrooms | $3,456 |
| 7 Bedrooms | $3,732 |
| 8 Bedrooms | $3,919 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,590 | $331,971 | 0.48% | F |
| 3BR | $2,200 | $479,556 | 0.46% | F |
| 4BR | $2,660 | $695,512 | 0.38% | F |
| 5BR | $3,086 | $957,740 | 0.32% | F |
U.S. Census Bureau data (2024)
A skeptical investor might question whether the Fair Market Rent (FMR) of $1,340 for ZIP 81505 (Grand Junction, CO) can sufficiently cover the mortgage on a home priced at $497,954. To address this, let's consider the median family income in the area, which is $90,830 according to recent census data. This suggests that families in the area can afford higher rents, making it plausible for the FMR to cover a mortgage on a home of that value, especially when factoring in potential appreciation and long-term investment gains.
Another concern could be the level of renter demand, given that only 28.8% of the housing units are occupied by renters. While this percentage might seem low, it is important to note that the rental vacancy rate for the United States as a whole was 6.8% in 2024. This implies that the rental market in Grand Junction is relatively stable and has room for growth without becoming oversaturated. However, it is crucial to monitor local trends to ensure sustained demand.
The final objection pertains to whether Section 8 vouchers will keep pace with the average market rent of $1,910. The FMR of $1,340 is lower than the market rent, indicating that voucher holders may struggle to find suitable housing. While the federal government aims to adjust voucher amounts periodically, there is no guarantee that they will always match market conditions. Investors should prepare for potential fluctuations in the availability and adequacy of vouchers.
In summary, while the FMR of $1,340 can likely cover a mortgage on a home priced at $497,954, the rental market in Grand Junction is moderately sized but stable. Vouchers may lag behind market rents, presenting a challenge for maintaining occupancy rates. These insights provide a balanced view of the investment landscape in ZIP 81505, highlighting both opportunities and risks.
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.