Location: Provo-Orem-Lehi, UT | Metro: Provo-Orem-Lehi, UT MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,140 |
| 1 Bedroom | $1,140 |
| 2 Bedrooms | $1,320 |
| 3 Bedrooms | $1,830 |
| 4 Bedrooms | $2,210 |
| 5 Bedrooms | $2,564 |
| 6 Bedrooms | $2,872 |
| 7 Bedrooms | $3,102 |
| 8 Bedrooms | $3,257 |
U.S. Census Bureau data (2024)
The analysis for ZIP code 84628 centers around the difference between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR in ZIP 84628 is set at $1,050. In contrast, the Census American Community Survey (ACS) indicates that the market rent stands at $1,071. This creates a gap of $21, which represents approximately 2% of the market rent.
Given that the FMR is lower than the market rent, landlords accepting Section 8 vouchers will be renting their properties at rates below the open-market level. This means that they will be subsidizing the difference between the FMR and the market rent. Specifically, for every unit rented under a Section 8 voucher, landlords will receive $21 less per month than what the market dictates. Over the course of a year, this amounts to a subsidy of $252 per unit.
The percentage gap, while small, can still impact a landlord's bottom line, especially when considering the broader economic context of ZIP 84628. Only 3.5% of residents are renters, suggesting a limited pool of potential tenants. Additionally, the median household income is $69,167, which does not provide a strong buffer against the financial strain of renting below market rates. The absence of a median home value figure further underscores the need for careful consideration of rental strategies.
In this scenario, landlords must weigh the benefits of steady, government-backed rental income against the cost of renting below market rates. While the guaranteed income from Section 8 vouchers can be attractive, particularly in a low-renter environment, the financial implications of renting below the market rate should not be overlooked. Landlords may find it beneficial to focus on other aspects of property management, such as maintaining high occupancy rates and minimizing vacancy periods, to offset the lower rental income.
To summarize, the gap between FMR and market rent in ZIP 84628 is a critical factor for landlords and small-portfolio investors. Accepting Section 8 vouchers means renting at a rate that is $21 or 2% below the market, which could affect profitability. However, the stability provided by these vouchers might outweigh the financial costs, especially given the limited rental market and the median income levels.
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.