Location: Salt Lake City, UT | Metro: Salt Lake City, UT HUD Metro FMR Area
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 | $1,300 |
| 1 Bedroom | $1,500 |
| 2 Bedrooms | $1,800 |
| 3 Bedrooms | $2,400 |
| 4 Bedrooms | $2,740 |
| 5 Bedrooms | $3,178 |
| 6 Bedrooms | $3,559 |
| 7 Bedrooms | $3,844 |
| 8 Bedrooms | $4,036 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,800 | $380,980 | 0.47% | F |
| 3BR | $2,400 | $483,344 | 0.5% | F |
| 4BR | $2,740 | $525,291 | 0.52% | F |
| 5BR | $3,178 | $589,927 | 0.54% | F |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 84084, located in West Jordan, UT, reveals some key insights into the potential investment returns. To start, let's consider the annualized Fair Market Rent (FMR) for a 2-bedroom apartment, which is set at $1810 per month for fiscal year 2024. This translates to an annual rental income of $21,720.
In contrast, the market rent, measured by the Zillow Observed Rent Index (ZORI), stands at $1,781 per month. Thus, the annual market rent would be $21,372. The median home value in this area is $517,463.
To derive the implied gross yield, we divide the annual rental income by the median home value. For the Section 8 scenario, the gross yield is calculated as follows:
Given the 26.7% renter density and the 20-day days-on-market (DOM), it becomes evident that the market conditions favor a slightly higher preference for Section 8 rentals over market-rate units. The lower DOM indicates quicker turnover and less vacancy risk, which is crucial for steady cash flow.
The slight edge in gross yield for Section 8 properties ($4.2%) compared to market-rate properties ($4.1%) aligns with the observed trend in rental preferences. This makes the Section 8 scenario more realistic for investors looking to minimize vacancy risk and ensure consistent income streams.
However, it's important to note that these gross yields do not account for operating expenses, property taxes, insurance, or other costs that would impact the net operating income (NOI). Investors should conduct their own detailed analysis to determine the true profitability of each option.
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.