Location: Provo-Orem-Lehi, UT | Metro: Provo-Orem-Lehi, UT 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 | $1,440 |
| 1 Bedroom | $1,450 |
| 2 Bedrooms | $1,680 |
| 3 Bedrooms | $2,340 |
| 4 Bedrooms | $2,810 |
| 5 Bedrooms | $3,260 |
| 6 Bedrooms | $3,651 |
| 7 Bedrooms | $3,943 |
| 8 Bedrooms | $4,140 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $2,340 | $425,652 | 0.55% | F |
| 4BR | $2,810 | $615,516 | 0.46% | F |
| 5BR | $3,260 | $816,162 | 0.4% | F |
U.S. Census Bureau data (2024)
The economics of Section 8 housing in ZIP code 84059 operate under specific financial guidelines designed to ensure affordability for low-income tenants while providing fair compensation for landlords. For a two-bedroom apartment, the SAFMR (Small Area Fair Market Rent) is set at $1260 per month for the fiscal year 2024. This figure is crucial because it represents the maximum amount that the Section 8 program will pay toward rent for this particular ZIP code.
Local market rents, as measured by ZORI (Zillow Observed Rent Index), stand at $1728 for a two-bedroom unit in ZIP 84059. This indicates a significant difference between the local market rates and the SAFMR, which can affect a landlord's decision to participate in the Section 8 program.
A landlord participating in Section 8 should understand that the total reimbursement they receive includes both the tenant's portion of the rent and utility allowances. The tenant is typically required to pay 30% of their adjusted income toward the rent. If we assume an average adjusted income of $1,400 for a tenant in this ZIP code, the tenant would contribute approximately $420 towards the rent ($1,400 x 0.3).
The remaining portion of the rent, up to the SAFMR limit of $1260, is covered by the Housing Authority. Therefore, if the tenant contributes $420, the Housing Authority would cover the difference, up to $1260. In this scenario, the landlord would receive a total of $1260 per month from the combined sources.
If the local market rent is higher than the SAFMR, as is the case with the $1728 ZORI, the landlord will face a reimbursement gap. Specifically, the gap would be $468 per month ($1728 - $1260). This means that landlords must either adjust their rental rates to match the SAFMR or accept a lower reimbursement rate than their market rent.
Utility allowances are additional payments made by the Housing Authority to help cover the cost of utilities. These allowances vary based on the size of the unit and the region. However, they do not increase the overall SAFMR but are paid separately to the tenant.
In summary, landlords in ZIP 84059 can expect a reimbursement of $1260 per month for a two-bedroom unit through the Section 8 program, regardless of the local market rent being higher. This results in a reimbursement gap of $468 per month when compared to the ZORI of $1728. Participation in the program requires understanding these economic realities and making decisions based on the long-term benefits versus short-term financial gaps.
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.