Location: Kauai County, HI | Metro: Kauai County, HI
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,590 |
| 1 Bedroom | $1,600 |
| 2 Bedrooms | $2,100 |
| 3 Bedrooms | $2,580 |
| 4 Bedrooms | $2,870 |
| 5 Bedrooms | $3,329 |
| 6 Bedrooms | $3,728 |
| 7 Bedrooms | $4,026 |
| 8 Bedrooms | $4,227 |
U.S. Census Bureau data (2024)
The Section 8 thesis in ZIP code 96769 is centered around the significant disparity between the Fair Market Rent (FMR) set at $1,930 for the fiscal year 2026 and the actual market rent of $975, based on recent Census ACS data. This creates a gap of $955, which translates into a 49.4% difference between what voucher holders can pay and the current market rate.
Given that the FMR exceeds the market rent, landlords and small-portfolio investors have an opportunity to leverage this situation as a yield play. The higher FMR means that voucher tenants can afford to pay a rent amount that is well above the local market price, thereby offering a higher return on investment compared to traditional rental scenarios.
In ZIP 96769, where 100.0% of residents are renters and the median household income is $46,250, the economic context underscores the attractiveness of this approach. Voucher tenants, who are guaranteed a subsidy that covers the majority of their rent, provide a stable source of income that is less susceptible to the financial fluctuations common among non-subsidized renters.
However, it's crucial to consider the administrative aspects of managing Section 8 properties. Landlords must adhere to HUD regulations and undergo regular inspections, which can be time-consuming and costly. Additionally, the process of obtaining and maintaining a Section 8 contract requires diligence and often involves navigating complex paperwork.
To summarize, the $955 gap between FMR and market rent presents a compelling yield opportunity for landlords in ZIP 96769. This is especially true given the high percentage of renters and the relatively low median income, which suggests a robust demand for subsidized housing options.
Data Sources: FMR data from HUD (2027). 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.