Location: Kauai County, HI | Metro: Kauai County, HI
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 | $1,710 |
| 1 Bedroom | $1,720 |
| 2 Bedrooms | $2,250 |
| 3 Bedrooms | $2,770 |
| 4 Bedrooms | $3,160 |
| 5 Bedrooms | $3,666 |
| 6 Bedrooms | $4,106 |
| 7 Bedrooms | $4,434 |
| 8 Bedrooms | $4,656 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,250 | $747,625 | 0.3% | F |
| 3BR | $2,770 | $783,659 | 0.35% | F |
| 4BR | $3,160 | $902,322 | 0.35% | F |
U.S. Census Bureau data (2024)
The ZIP code 96716 encompasses the small town of Hanapepe, HI, which is characterized by a modest population of 2,650 residents. Only 23.7% of the inhabitants are renters, indicating a primarily owner-occupied community. The median household income in Hanapepe stands at a robust $105,000, reflecting a relatively affluent area. This prosperity is further underscored by the median home value of $809,469, positioning Hanapepe as a high-value residential zone.
Turning to the rental economics, the Fair Market Rent (FMR) for fiscal year 2026 in the metro area is set at $2,180. In comparison, the actual market rent as per the Census ACS data is slightly higher at $2,191. This close alignment between the FMR and market rent suggests a stable rental environment where Section 8 vouchers can effectively support tenants without significantly deviating from the local rental prices.
Given these economic indicators, Hanapepe, HI, is a suitable location for both hands-off voucher operators and hands-on value-add buyers. For hands-off operators, the low percentage of renters and the town's affluent demographic provide a solid foundation for predictable and stable cash flows. On the other hand, hands-on value-add buyers might find opportunities in enhancing properties to meet the needs of the community, given the high median income and home values. Such enhancements could include modernizing interiors, improving energy efficiency, or adding amenities that appeal to the local lifestyle, thereby increasing rental rates above the FMR while still attracting tenants who benefit from the Section 8 program.
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.