Location: Hawaii County, HI | Metro: Hawaii 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 | $1,580 |
| 1 Bedroom | $1,590 |
| 2 Bedrooms | $2,050 |
| 3 Bedrooms | $2,580 |
| 4 Bedrooms | $2,870 |
| 5 Bedrooms | $3,329 |
| 6 Bedrooms | $3,728 |
| 7 Bedrooms | $4,026 |
| 8 Bedrooms | $4,227 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,050 | $606,504 | 0.34% | F |
| 3BR | $2,580 | $615,660 | 0.42% | F |
| 4BR | $2,870 | $799,445 | 0.36% | F |
| 5BR | $3,329 | $872,207 | 0.38% | F |
U.S. Census Bureau data (2024)
Investors considering ZIP 96727 (Honokaa, HI) often have several key concerns. One common objection is whether the Fair Market Rent (FMR) of $1,980 for the metro area in fiscal year 2026 will sufficiently cover the mortgage on a $642,760 home. According to recent data, the median list price for properties in 96727 is significantly higher at $1,512,500. This suggests that homes in this ZIP code are generally more expensive, making it challenging to find a $642,760 home. However, if such a home were available, the FMR would likely cover the mortgage, especially given typical interest rates.
A second concern is the level of renter demand, which stands at 13.8%. Critics might argue that this percentage is too low to ensure steady occupancy. The reality is that the rental market in 96727 is relatively small compared to larger metropolitan areas. With only 23 apartments listed for rent, the competition for tenants is fierce. Yet, the increase in average rent prices over the past year indicates a strong demand among those seeking rentals. Investors should focus on the quality and uniqueness of their properties to attract renters.
The final objection is whether Housing Choice Vouchers will keep pace with market rents of $1,506. While the voucher program aims to provide affordable housing options, the actual amount can vary widely based on location and family size. In 96727, the voucher amount may not always match the market rate due to the high cost of living in Hawaii. Landlords must be prepared to negotiate with voucher recipients and possibly accept lower rent payments than the market rate.
In summary, while the FMR of $1,980 could cover the mortgage on a $642,760 home, finding such a property in 96727 may be difficult. Renter demand, though modest at 13.8%, shows signs of growth with rising rental prices. Lastly, voucher amounts may lag behind market rents of $1,506, requiring landlords to adapt their expectations and 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.