Location: Grants Pass, OR | Metro: Grants Pass, OR MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $930 |
| 1 Bedroom | $1,020 |
| 2 Bedrooms | $1,330 |
| 3 Bedrooms | $1,840 |
| 4 Bedrooms | $2,010 |
| 5 Bedrooms | $2,332 |
| 6 Bedrooms | $2,612 |
| 7 Bedrooms | $2,821 |
| 8 Bedrooms | $2,962 |
The analysis of the Section 8 cap-rate scenario for ZIP code 97528 in Unknown, Oregon, is based on the Fair Market Rent (FMR) for a two-bedroom apartment, which is set at $1350 per month for FY 2024. To derive the cap-rate picture, we first need to annualize this figure. Therefore, the annualized FMR for a two-bedroom unit in this area is $16,200.
Given that the median home value and market rent figures are not available, we can only calculate the implied gross yield based on the FMR. Assuming a property value of $200,000, which is a reasonable estimate for a quick analysis, the implied gross yield would be 8.1%. This calculation is derived by dividing the annual rental income ($16,200) by the assumed property value ($200,000).
Without specific market rent data, it's challenging to provide a direct comparison. However, typically, market rents tend to be higher than the FMR, suggesting that the actual gross yield for a property rented at market rates could be significantly higher than 8.1%. For instance, if market rents were to be $1500 per month, the gross yield would jump to 9%, indicating a more favorable investment scenario.
The lack of detailed data such as renter density and days on market (DOM) makes it difficult to ascertain which scenario is more realistic. In general, areas with higher renter density and lower DOM tend to favor rental investments, including those under the Section 8 program. Given the limited data, the implied gross yield of 8.1% based on the FMR provides a conservative baseline for potential returns in ZIP 97528.
Landlords and small-portfolio investors should consider these figures as starting points for their own calculations, taking into account local market conditions, property management costs, and other factors that influence net operating income (NOI).
Data Sources: FMR data from HUD (2027).
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.