Location: Phoenix-Mesa-Chandler, AZ | Metro: Phoenix-Mesa-Chandler, AZ MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,400 |
| 1 Bedroom | $1,500 |
| 2 Bedrooms | $1,740 |
| 3 Bedrooms | $2,300 |
| 4 Bedrooms | $2,550 |
| 5 Bedrooms | $2,958 |
| 6 Bedrooms | $3,313 |
| 7 Bedrooms | $3,578 |
| 8 Bedrooms | $3,757 |
The potential risks for investing in Section 8 properties in ZIP code 85311, Unknown, AZ, include significant challenges related to tenant turnover, vacancy exposure, and deferred maintenance. With the Fair Market Rent (FMR) set at $1880 for FY 2024, there is an unclear market rent figure which makes it difficult to assess the competitiveness of rental prices. This ambiguity can lead to higher tenant turnover if the market rent is significantly above the FMR, causing tenants to seek better deals elsewhere.
Vacancy exposure is another concern due to the lack of data on the days on market (DOM). Without this information, it's challenging to predict how quickly a property might fill up once it becomes vacant, potentially leading to extended periods without rental income.
Deferred maintenance is also a critical issue, especially when there is no specific data on the typical home value or median income in the area. This absence of information means that landlords may face unpredictable costs for maintaining and repairing properties, which can be particularly problematic for first-time Section 8 landlords who might not have a reserve fund for such expenses.
However, these risks must be weighed against the high renter share in the area, which is currently unknown. Typically, a high percentage of renters in a ZIP code indicates a strong demand for rental housing and, consequently, a higher likelihood of voucher holders seeking accommodation. This factor can mitigate some of the risks associated with tenant turnover and vacancy exposure.
In conclusion, based on the available data, the risk for a first-time Section 8 landlord in ZIP 85311, Unknown, AZ, is moderate. The lack of specific market data introduces uncertainty, but the potential for high voucher demand offers a counterbalance to these risks.
Data Sources: FMR data from HUD (2027).
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.