Location: Prescott Valley-Prescott, AZ | Metro: Prescott Valley-Prescott, 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 | $1,020 |
| 1 Bedroom | $1,180 |
| 2 Bedrooms | $1,480 |
| 3 Bedrooms | $2,050 |
| 4 Bedrooms | $2,250 |
| 5 Bedrooms | $2,610 |
| 6 Bedrooms | $2,923 |
| 7 Bedrooms | $3,157 |
| 8 Bedrooms | $3,315 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,180 | $325,193 | 0.36% | F |
| 2BR | $1,480 | $421,850 | 0.35% | F |
| 3BR | $2,050 | $630,758 | 0.33% | F |
| 4BR | $2,250 | $812,579 | 0.28% | F |
| 5BR | $2,610 | $971,749 | 0.27% | F |
U.S. Census Bureau data (2024)
The ZIP code 86303 in Prescott, AZ, encompasses a diverse residential area with a total population of 19,446. Renters make up 29.2% of the residents, indicating a significant portion of the community relies on rental housing. The median household income in this area is $72,359, reflecting a middle-class neighborhood where many residents can afford modest to mid-range living expenses. Median home values stand at $586,272, suggesting a mix of affordable and higher-end properties.
In terms of rent economics, the Fair Market Rent (FMR) for ZIP 86303 in fiscal year 2024 is set at $1,270. This figure contrasts sharply with the market rent, which according to ZORI (Zillow Observed Rent Index), averages $1,702. This discrepancy highlights an opportunity for landlords and small-portfolio investors to leverage the gap between subsidized and market rents.
Given these figures, ZIP 86303 is well-suited for both hands-off voucher operators and hands-on value-add buyers. For those who prefer a hands-off approach, the stable demand for rental properties and the presence of a substantial number of renters mean that Section 8 vouchers can provide a reliable source of income. On the other hand, for hands-on investors looking to add value, there's potential to improve property quality and increase rents beyond the FMR, taking advantage of the higher market rent. The balance between affordability and market rates makes this area attractive for various investment strategies.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-08-31). 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.