Location: Sanpete County, UT | Metro: Sanpete County, UT
| Unit Size | Monthly FMR |
|---|---|
| Studio | $810 |
| 1 Bedroom | $830 |
| 2 Bedrooms | $1,080 |
| 3 Bedrooms | $1,300 |
| 4 Bedrooms | $1,420 |
| 5 Bedrooms | $1,647 |
| 6 Bedrooms | $1,845 |
| 7 Bedrooms | $1,993 |
| 8 Bedrooms | $2,093 |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 84622 reveals an interesting contrast between federally mandated Fair Market Rents (FMRs) and actual market conditions. For a two-bedroom property, the annualized FMR stands at $1,060 per month, while the Census ACS indicates a market rent of $854 per month.
To calculate the implied gross yield, we first need to establish a rental income figure. Using the FMR, the annual rental income would be $12,720 ($1,060 x 12 months). The market rent suggests an annual income of $10,248 ($854 x 12 months).
Unfortunately, the median home value for ZIP 84622 is not available, which complicates a direct cap rate calculation. However, we can still infer some useful information from the renter density and days on market (DOM). With a 9.6% renter density, it's clear that the majority of residents prefer homeownership over renting, which might impact the demand for rental properties. Additionally, the lack of DOM data means we cannot assess how quickly rental units are being filled, which could indicate either strong demand or weak competition.
Given these constraints, the $12,720 annual rental income based on FMR provides a more optimistic scenario. This higher figure implies a better gross yield, especially if the cost of acquisition is lower. Conversely, the $10,248 based on market rent reflects a more conservative gross yield, aligning closely with what landlords and small-portfolio investors might realistically expect.
In ZIP 84622, the $1,060 monthly FMR appears less grounded in reality compared to the $854 market rent. The low renter density suggests that tenants may have more leverage in negotiating rents closer to the market rate rather than the FMR. Therefore, the $854 monthly market rent is likely the more accurate basis for calculating gross yields and should be considered when making investment decisions.
Data Sources: FMR data from HUD (2027). 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.