Location: Navajo County, AZ | Metro: Navajo County, AZ
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,010 |
| 1 Bedroom | $1,100 |
| 2 Bedrooms | $1,440 |
| 3 Bedrooms | $1,780 |
| 4 Bedrooms | $1,890 |
| 5 Bedrooms | $2,192 |
| 6 Bedrooms | $2,455 |
| 7 Bedrooms | $2,651 |
| 8 Bedrooms | $2,784 |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 85912 reveals some interesting insights into potential investment opportunities. The Fair Market Rent (FMR) for a 2-bedroom apartment, as determined by HUD for fiscal year 2026, is set at $1,560 per month. However, the median home value and market rent data for this ZIP code are currently unavailable, which limits our ability to provide a comprehensive analysis.
To calculate the implied gross yield, we must first annualize the FMR. At $1,560 per month, the annual rent would be $18,720. If we were to assume a property value based on the median home value, the gross yield can be calculated as the annual rent divided by the property value. Unfortunately, without the median home value, we cannot provide an exact figure for the gross yield in this scenario. However, it's important to note that the gross yield is a critical metric for understanding the profitability of a rental property before considering operating expenses and other costs.
In the case where the market rent is also not available, we must rely solely on the FMR to gauge potential returns. Given the 0.0% renter density, it's evident that very few residents in ZIP 85912 participate in the Section 8 program. This low participation rate suggests that relying on Section 8 tenants alone might not be a viable strategy for maximizing returns. Additionally, the days on market (DOM) being listed as N/A indicates incomplete data, which further complicates the analysis.
While the FMR provides a baseline for potential rental income, the lack of specific median home values and market rents makes it difficult to accurately compare the gross yields between a Section 8 scenario and a market-rate scenario. In reality, the gross yield from a market-rate rental would likely exceed the FMR-based yield, assuming that market rates are higher than the FMR. However, the decision to invest in Section 8 properties should also consider factors such as the stability of government-subsidized rents and the administrative burden of participating in the program.
The low renter density in ZIP 85912 implies that finding Section 8 tenants could be challenging, potentially leading to longer vacancy periods and reduced income. Therefore, while the FMR offers a predictable income stream, the practicality of achieving this yield in ZIP 85912 is questionable given the current data.
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.