Location: Flagstaff, AZ | Metro: Flagstaff, AZ MSA
Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,470 |
| 1 Bedroom | $1,570 |
| 2 Bedrooms | $1,900 |
| 3 Bedrooms | $2,290 |
| 4 Bedrooms | $2,680 |
| 5 Bedrooms | $3,109 |
| 6 Bedrooms | $3,482 |
| 7 Bedrooms | $3,761 |
| 8 Bedrooms | $3,949 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,900 | $459,479 | 0.41% | F |
| 3BR | $2,290 | $569,228 | 0.4% | F |
U.S. Census Bureau data (2024)
A skeptical investor might question whether the Fair Market Rent (FMR) of $2,590 for ZIP code 86024 (Happy Jack, AZ) can sufficiently cover the mortgage on a median-priced home valued at $509,585. To address this concern, we must consider that the FMR represents the maximum amount that a tenant could pay under the Section 8 program. However, the actual mortgage payment for a home priced at $509,585 would depend on the interest rate and loan terms. At an average interest rate and typical loan term, the monthly mortgage payment could exceed the FMR. Thus, relying solely on FMR might not be enough to cover the mortgage unless the investor secures additional sources of income.
The second objection is whether there is sufficient rental demand at a vacancy rate of 9.5%. A vacancy rate of 9.5% indicates that there is space available in the rental market, which could mean that finding tenants is easier. However, it also suggests that competition among landlords is high. The key here is understanding the dynamics of the local rental market. If the demand for rental properties is steady, then the vacancy rate should not significantly impact the ability to find tenants. Nevertheless, the data does not provide insights into the number of Section 8 eligible tenants in the area, which is crucial for assessing the specific demand for subsidized housing.
Lastly, the investor might wonder if voucher payments will keep up with the general market rents, given that the data shows market rents as N/A. This lack of information makes it challenging to predict how well voucher payments will match the cost of living in Happy Jack, AZ. Historically, voucher payments have sometimes lagged behind increases in market rents, leading to difficulties in securing suitable housing for eligible families. Without specific market rent data, it's impossible to make a definitive statement on the alignment between voucher payments and local rental costs. Investors should monitor any updates on market rent trends in the area to better assess future financial viability.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.