Section 8 Fair Market Rent (FMR) for ZIP 85552 - 2027

FY 2027 Fair Market Rent Rates

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

A skeptical investor looking at ZIP code 85552 might have several concerns regarding the feasibility of investing in properties under the Section 8 program. Let's address these concerns directly.

• Will Fair Market Rent (FMR) of $1,230 cover the mortgage on a $347,960 home? The FMR of $1,230 is the maximum amount that HUD will pay for a rental unit in a given area. However, whether this amount covers the mortgage on a $347,960 home depends on the interest rate and loan terms. Assuming a typical 30-year fixed-rate mortgage at an average rate of 4%, the monthly payment would be approximately $1,670. This means the FMR does not fully cover the mortgage, leaving a shortfall of about $440 per month. Investors must consider additional sources of income or plan for this gap.
• Is there enough renter demand at 24.6%? The 24.6% figure represents the percentage of households that are renters in ZIP 85552. While this is a significant portion, it does not necessarily indicate strong demand for Section 8 housing. The number of available vouchers and the competition among landlords for these tenants are also critical factors. Data on voucher availability and tenant preferences in the area would provide a clearer picture of demand. Without such specific data, we can only infer that there is a moderate level of renter presence, but the strength of demand for Section 8 units remains uncertain.
• Will vouchers keep pace with $937 market rents? The current market rent of $937 is below the FMR of $1,230, suggesting that vouchers are currently sufficient to cover the cost of renting in this ZIP code. However, the long-term sustainability of this trend depends on how well the voucher amounts adjust to inflation and changes in the local real estate market. If market rents increase faster than voucher amounts, landlords could face financial pressures. The data provided does not give insight into future adjustments of voucher amounts, so caution is advised when considering the long-term viability of maintaining rental income solely through Section 8.

The analysis of ZIP 85552 reveals both opportunities and challenges for Section 8 investments. While the current FMR exceeds market rents, it does not sufficiently cover the mortgage on a median-priced home. Additionally, the renter population is present but the demand for Section 8 units requires further investigation. Lastly, the ability of vouchers to keep up with rising rents is uncertain without more detailed projections.

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.