Location: Douglas County, NV | Metro: Douglas County, NV
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 | $1,390 |
| 1 Bedroom | $1,520 |
| 2 Bedrooms | $1,990 |
| 3 Bedrooms | $2,760 |
| 4 Bedrooms | $3,330 |
| 5 Bedrooms | $3,863 |
| 6 Bedrooms | $4,327 |
| 7 Bedrooms | $4,673 |
| 8 Bedrooms | $4,907 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,990 | $749,194 | 0.27% | F |
| 3BR | $2,760 | $1,343,854 | 0.21% | F |
| 4BR | $3,330 | $1,937,253 | 0.17% | F |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 89448, Zephyr Cove, NV, reveals a complex picture when comparing the Federal Market Rent (FMR) and the market rent figures. For a two-bedroom unit, the annualized FMR stands at $1,960, while the Census ACS market rent is slightly higher at $2,007.
To derive the implied gross yield, we first calculate the potential rental income based on these figures. The annualized FMR of $1,960 translates to a monthly rent of approximately $163.33. Using the median home value of $1,387,925, the implied gross yield for an FMR scenario is roughly 1.47%. This calculation is derived from the formula: (Annualized Rent / Median Home Value) * 100. For the market rent of $2,007, the monthly rent is about $167.25, leading to an implied gross yield of 1.49%.
Given the 14.6% renter density in Zephyr Cove, it's important to note that the area has a relatively low proportion of renters compared to homeowners. This suggests that landlords might face challenges in finding tenants willing to participate in the Section 8 program. Additionally, the N/A-day DOM (days on market) indicates that there is no available data on how long properties typically stay on the market before being rented, which could be due to the limited rental activity in the area.
Considering these factors, the FMR scenario appears less realistic for landlords and small-portfolio investors. The market rent figure of $2,007, which is only marginally higher than the FMR, is more likely to attract tenants in a market where rental demand is lower. However, even at this higher rate, the implied gross yield remains modest at just over 1.4%, indicating that investors should expect relatively low returns compared to the median home value.
In conclusion, for ZIP 89448, the gross yield based on market rent is slightly more favorable at 1.49%, but both scenarios reflect a challenging environment for landlords seeking high returns. The low renter density and lack of data on rental market dynamics suggest that securing tenants through the Section 8 program may be difficult, making the market rent option the more practical choice for investors.
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.