Location: Tillamook County, OR | Metro: Clatsop County, OR
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 | $1,120 |
| 1 Bedroom | $1,240 |
| 2 Bedrooms | $1,600 |
| 3 Bedrooms | $2,220 |
| 4 Bedrooms | $2,480 |
| 5 Bedrooms | $2,877 |
| 6 Bedrooms | $3,222 |
| 7 Bedrooms | $3,480 |
| 8 Bedrooms | $3,654 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,240 | $552,701 | 0.22% | F |
| 2BR | $1,600 | $503,164 | 0.32% | F |
| 3BR | $2,220 | $596,549 | 0.37% | F |
| 4BR | $2,480 | $790,046 | 0.31% | F |
U.S. Census Bureau data (2024)
The Section 8 cap-rate scenario for ZIP 97131, Nehalem, Oregon, can be analyzed using the Federal Market Rent (FMR) and market rent figures for a two-bedroom apartment. The annualized FMR for a 2BR unit is $1,630, while the market rent stands at $1,179 based on Census ACS data.
To derive the gross yield, we first calculate the annual rental income for both scenarios. For the FMR scenario, the annual rental income would be $1,630 multiplied by 12, equating to $19,560. Given the median home value of $566,339, the implied gross yield is approximately 3.45%. This calculation is derived from the formula: Gross Yield = (Annual Rental Income / Property Value) * 100. In this case, it is ($19,560 / $566,339) * 100 = 3.45%.
In contrast, the market rent scenario provides an annual rental income of $1,179 multiplied by 12, totaling $14,148. Using the same median home value, the gross yield here is about 2.50%. This is calculated as ($14,148 / $566,339) * 100 = 2.50%.
Considering the renter density of 6.4%, the FMR scenario appears more realistic for Section 8 properties. However, the lack of data on days on market (DOM) makes it difficult to fully assess the market dynamics. Despite this, the higher gross yield from the FMR scenario suggests a stronger financial incentive for landlords and small-portfolio investors interested in Section 8 tenancy. It's important to note that these yields do not account for operating expenses, vacancy rates, or other factors that would affect net operating income (NOI).
Investors should compare these gross yields to their own investment criteria. While the FMR scenario offers a higher return at 3.45%, the actual performance will depend on various factors including the local housing market conditions and the specific terms of Section 8 contracts. The market rent scenario, with a gross yield of 2.50%, might be more reflective of typical rental incomes but does not capture the potential benefits of participating in the Section 8 program.
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.