Location: Salem, OR | Metro: Corvallis, OR MSA
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 | $1,220 |
| 1 Bedroom | $1,310 |
| 2 Bedrooms | $1,650 |
| 3 Bedrooms | $2,290 |
| 4 Bedrooms | $2,580 |
| 5 Bedrooms | $2,993 |
| 6 Bedrooms | $3,352 |
| 7 Bedrooms | $3,620 |
| 8 Bedrooms | $3,801 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,650 | $400,864 | 0.41% | F |
| 3BR | $2,290 | $461,349 | 0.5% | F |
| 4BR | $2,580 | $521,478 | 0.49% | F |
| 5BR | $2,993 | $637,931 | 0.47% | F |
U.S. Census Bureau data (2024)
The Section 8 thesis for ZIP code 97361, located in Monmouth, Oregon, centers around the disparity between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR is set at $1360, while the Zillow Observed Rent Index (ZORI) indicates a market rent of $1496. This creates a gap of $136 per month, or approximately 9.9%, where landlords can potentially undercharge voucher tenants compared to the open market.
Given that Monmouth has a rental population comprising 43.4% of its residents, the demand for affordable housing is significant. The median home value in the area is $473,554, and the median income stands at $69,505, which suggests that many residents may struggle to afford the higher market rents without assistance.
When FMR is less than the market rent, it means landlords who accept Section 8 vouchers will be receiving slightly less than what they could charge in the open market. However, this does not necessarily translate into a loss. The stability and reliability of voucher payments, guaranteed by the government, mitigate risks associated with non-payment or delinquency common in the open market. Additionally, the consistent flow of income from Section 8 can be a strategic yield play, particularly in a market where the majority of the population relies on rental housing.
Despite the lower FMR, the benefits of having a tenant whose rent is subsidized by the government can outweigh the initial financial gap. Landlords benefit from reduced vacancy rates and less turnover, which can save them money on advertising, maintenance, and lost rent. Moreover, the local context of Monmouth, with its relatively low median income, makes the Section 8 program an essential part of the rental market, ensuring that a substantial portion of the population can find suitable accommodation.
In summary, the $136 monthly gap between the FMR and market rent in ZIP 97361 represents a strategic opportunity for landlords. While it may seem like a cost to house voucher tenants below market rates, the security and stability of these rentals provide a reliable yield that aligns well with the needs of the local community in Monmouth, Oregon.
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.