Location: Phoenix-Mesa-Chandler, AZ | Metro: Phoenix-Mesa-Chandler, AZ MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,110 |
| 1 Bedroom | $1,190 |
| 2 Bedrooms | $1,380 |
| 3 Bedrooms | $1,870 |
| 4 Bedrooms | $2,120 |
| 5 Bedrooms | $2,459 |
| 6 Bedrooms | $2,754 |
| 7 Bedrooms | $2,974 |
| 8 Bedrooms | $3,123 |
U.S. Census Bureau data (2024)
The analysis of the Section 8 program in ZIP code 85191 centers around the discrepancy between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR is set at $1780. However, the market rent data is currently unavailable, which makes it challenging to provide a direct comparison and percentage gap.
In scenarios where the FMR exceeds the market rent, landlords benefit from a higher guaranteed rental income through the voucher system. This creates a yield play, meaning that properties rented to Section 8 tenants can generate better returns than those rented at prevailing market rates. Landlords should be aware that while the income is stable and government-backed, there may be additional administrative requirements and inspections associated with the program.
Conversely, if the FMR is lower than the market rent, landlords face the decision of renting their units below the open-market rate. This scenario typically occurs when market rents rise faster than the FMR adjustments. In such cases, landlords must weigh the benefits of guaranteed payments against the potential loss of higher rental income they could receive from non-voucher tenants. The stability of rental payments and the reduction in vacancy risk might offset the lower per-unit revenue.
The ZIP code 85191 has 0.0% of its population classified as renters, indicating a predominantly owner-occupied area. The median home value and median income data are also not available, which means we cannot fully contextualize the financial landscape of the area. Despite these limitations, understanding the FMR versus market rent dynamics is crucial for landlords and small-portfolio investors considering participation in the Section 8 program.
To conclude, the decision to participate in Section 8 in ZIP 85191 should be based on the financial gap between the FMR and market rent, once the latter becomes available. Given the lack of rental population and missing economic data, further research into local real estate trends and the specific needs of the area would be advisable before making any 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.