Location: Lincoln County, OR | Metro: Lincoln 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 | $1,080 |
| 1 Bedroom | $1,090 |
| 2 Bedrooms | $1,420 |
| 3 Bedrooms | $1,920 |
| 4 Bedrooms | $2,370 |
| 5 Bedrooms | $2,749 |
| 6 Bedrooms | $3,079 |
| 7 Bedrooms | $3,325 |
| 8 Bedrooms | $3,491 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,090 | $254,885 | 0.43% | F |
| 2BR | $1,420 | $390,303 | 0.36% | F |
| 3BR | $1,920 | $519,732 | 0.37% | F |
| 4BR | $2,370 | $639,726 | 0.37% | F |
| 5BR | $2,749 | $730,403 | 0.38% | F |
U.S. Census Bureau data (2024)
The Section 8 thesis in ZIP code 97365, which encompasses Newport, Oregon, centers around the significant gap between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2026, the FMR is set at $1,490, while the market rent, measured by Zillow's Rent Index (ZORI), stands at $2,053. This results in a gap of $563, or approximately 37.8%, between what landlords can charge through the Section 8 program and the open-market rental rates.
The discrepancy highlights the financial challenge faced by landlords who choose to participate in the Section 8 program. They must accept a lower rent compared to the prevailing market conditions. In Newport, where 39.6% of residents are renters, and the median home value is $430,235, the decision to enroll properties in Section 8 requires careful consideration of the local economic landscape.
With a median income of $64,363 in Newport, many potential tenants may rely on housing vouchers to afford living in the area. However, landlords should be aware that accepting a tenant with a housing voucher means they will only receive the FMR amount of $1,490, even though the market rent could be up to $2,053. This difference represents a substantial reduction in rental income, making it a less attractive option for those seeking maximum yield from their investments.
Despite the lower rental rate, there are strategic advantages to participating in the Section 8 program. It ensures a steady stream of income with government backing, reducing the risk of vacancy and non-payment. Additionally, it can serve as a way to stabilize cash flow, particularly in areas where the demand for affordable housing is high.
To summarize, the gap between the FMR and market rent in ZIP 97365 is a critical factor for landlords and small-portfolio investors considering the Section 8 program. The $563 difference, or 37.8% of the market rent, underscores the need to weigh the benefits of guaranteed tenancy against the lower income received per unit.
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.