Section 8 Fair Market Rent (FMR) for ZIP 83440 - 2027

Investment Score for ZIP 83440

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	$1,020
1 Bedroom	$1,070
2 Bedrooms	$1,160
3 Bedrooms	$1,610
4 Bedrooms	$1,900
5 Bedrooms	$2,204
6 Bedrooms	$2,468
7 Bedrooms	$2,665
8 Bedrooms	$2,798

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,160	$231,557	0.5%	F
3BR	$1,610	$362,751	0.44%	F
4BR	$1,900	$460,914	0.41%	F
5BR	$2,204	$536,046	0.41%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 83440 (Rexburg, ID) #### Section 8 Voucher Dynamics In ZIP code 83440, the Fair Market Rent (FMR) for a two-bedroom unit is set at $1,120 per month in 2026. This figure represents 23.1% of the median household income of $58,159, which indicates that it is a reasonable rent amount relative to local incomes. However, the actual rental market in Rexburg shows a different picture. The Zillow median price for a two-bedroom unit is $226,689, which translates to a monthly rent of approximately $1,370 based on typical mortgage calculations (assuming a 5% interest rate and 20% down payment). This means that the actual rent is significantly higher than the FMR, creating a gap of about $250 per month between what voucher holders can afford and the actual market rates. The constraints for voucher holders are clear: they must find units that do not exceed the FMR. In Rexburg, this means that voucher holders are limited to properties that cost $1,120 or less for a two-bedroom unit. Given the high actual market rents, this could be challenging, especially since landlords may prefer higher-paying tenants. #### Affordability & Renter Profile The renter profile in ZIP code 83440 is quite significant, with 61.5% of the population being renters. This high percentage suggests a strong demand for rental housing, making it a competitive market for both tenants and investors. The occupancy rate of 88.0% further supports the idea that there is a tight rental market, with most available units being occupied. Given the median household income of $58,159, affordability is a key issue. A two-bedroom unit priced at $1,120 would consume 23.1% of the median income, which is already a substantial portion. For those relying on Section 8 vouchers, finding affordable housing becomes even more critical. The high renter percentage combined with the relatively low median income points to a market where many residents struggle to find housing that fits their budget. #### Investor Angle From an investor’s perspective, the ZIP code 83440 presents a mixed picture. While the median home price of $226,689 might seem attractive, the price-to-FMR ratio of 16.9x indicates that the property values are much higher than the rents that can be charged under the Section 8 program. This means that investors who rely solely on Section 8 vouchers will likely face challenges in achieving positive cash flow. To illustrate, let's consider a two-bedroom unit. At the FMR of $1,120, the monthly rent would be significantly lower than the potential market rent of around $1,370. This difference can impact the profitability of the investment. Additionally, the high property values suggest that the initial capital outlay for purchasing a property is substantial, which could make it difficult to break even or generate a profit, especially when factoring in maintenance costs, property taxes, and other expenses. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should focus on smaller units such as one-bedroom or studio apartments. These units have lower FMRs ($1,020 for a one-bedroom) and may be more aligned with the actual rental market. This strategy could help achieve better cash flow and potentially attract more tenants. 2. **Consider Multi-Family Properties**: Multi-family properties can offer economies of scale and may be more financially viable. For example, a four-unit apartment building with each unit renting at the FMR would generate a total of $4,260 per month ($1,020 x 4 units), which could be sufficient to cover the mortgage, taxes, and other expenses associated with a property valued at $226,689. 3. **Look for Undervalued Properties**: Investors should search for properties that are undervalued compared to the Zillow median. If a two-bedroom unit can be found for below $226,689, it may be possible to charge closer to the actual market rent while still maintaining a positive cash flow. This requires thorough research and possibly working with local real estate agents who can identify such opportunities. #### Bottom Line For Section 8-focused investors, ZIP code 83440 presents a challenging environment due to the high price-to-FMR ratio and the tight rental market. The recommendation would be to **Skip** this area unless you can find undervalued properties or focus on smaller units where the gap between FMR and market rent is less pronounced. The high property values and the limited ability to charge market rents make it difficult to achieve positive cash flow, which is crucial for long-term investment success. In summary, while Rexburg has a strong demand for rental housing, the current dynamics make it less favorable for investors looking to leverage Section 8 vouchers. The high cost of entry and the constraints imposed by FMRs suggest that this market may not be the best choice for such investments.

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.