Section 8 Fair Market Rent (FMR) for ZIP 97305 - 2027

Investment Score for ZIP 97305

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,340
1 Bedroom	$1,350
2 Bedrooms	$1,760
3 Bedrooms	$2,440
4 Bedrooms	$2,670
5 Bedrooms	$3,097
6 Bedrooms	$3,469
7 Bedrooms	$3,747
8 Bedrooms	$3,934

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,760	$339,889	0.52%	F
3BR	$2,440	$415,728	0.59%	F
4BR	$2,670	$471,429	0.57%	F
5BR	$3,097	$540,009	0.57%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 97305 (Hayesville, OR) #### Section 8 Voucher Dynamics In ZIP code 97305, the Fair Market Rent (FMR) for a two-bedroom apartment is set at $1640 per month. This figure represents 29.7% of the median household income of $66,326. However, the actual rent for a two-bedroom unit can be significantly higher, with Zillow reporting a median price of $333,459, which translates to a monthly rental cost of approximately $16.9 times the FMR, or roughly $27,816 annually. Given that the maximum allowable rent under a Section 8 voucher is capped at the FMR, this creates a significant constraint for voucher holders who would struggle to find affordable housing options within their budget. The disparity between FMR and actual market rents suggests that many units are out of reach for those relying on Section 8 vouchers, leading to a challenging environment for low-income renters. #### Affordability & Renter Profile The renter population in Hayesville, OR, accounts for 47.2% of the total population of 45,083. With such a high percentage of renters, the demand for affordable housing is substantial. However, the occupancy rate stands at 96.7%, indicating a tight market where most available units are already occupied. This tightness further exacerbates the affordability issue, as it limits the number of units available for voucher holders. The median household income of $66,326 is relatively modest compared to the high rental costs, suggesting that many residents may face financial strain to cover their housing expenses. For those who do not qualify for Section 8 vouchers, the high price-to-FMR ratio means that renting is particularly challenging, especially for families needing larger units like three or four bedrooms. #### Investor Angle From an investor perspective, the ZIP code 97305 presents a mixed picture. The FMR for a two-bedroom unit is $1640, while the actual median rent is much higher, around $27,816 annually. If an investor were to purchase a property at the median price of $333,459 and rent it out at the FMR, they would likely see negative cash flow due to the high acquisition cost and lower rental income. The price-to-FMR ratio of 16.9x indicates that the market is overpriced relative to what Section 8 vouchers can cover, making it difficult to achieve positive cash flow without relying on non-voucher tenants who can afford higher rents. In terms of investment grade, the high price-to-FMR ratio and the tight market conditions suggest that the ZIP code is not ideal for investors focusing solely on Section 8 vouchers. The risk of vacancy and the need to compete with market rates for non-voucher tenants could lead to financial instability. Additionally, the high acquisition cost relative to the FMR implies that the returns on investment might be lower than expected, especially if the investor is looking to generate cash flow through rental income alone. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should consider focusing on smaller units, such as one-bedroom apartments, which have a lower FMR of $1260. While still constrained by the voucher cap, these units may be more accessible to voucher holders and could potentially attract non-voucher tenants willing to pay slightly above the FMR but below market rates. 2. **Target Underserved Areas**: Within ZIP code 97305, there may be pockets or neighborhoods where the rental prices are closer to the FMR. Investors should conduct detailed neighborhood analyses to identify areas with lower rental costs. This could involve looking at older properties or areas with less demand, where the price-to-FMR ratio is more favorable. 3. **Consider Alternative Investment Strategies**: Given the challenges in achieving positive cash flow with Section 8 vouchers alone, investors might want to explore alternative strategies such as combining Section 8 units with market-rate rentals or seeking properties with potential for value-add improvements that could justify higher rents. #### Bottom Line Based on the provided data, the recommendation for Section 8-focused investors in ZIP code 97305 is to **skip** this market. The high price-to-FMR ratio and tight market conditions make it difficult to achieve positive cash flow, and the limited availability of units that fall within the FMR range poses a significant challenge. Investors should look for markets with a more favorable price-to-FMR ratio and a greater supply of affordable units to ensure better financial outcomes and stability.

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.