Location: Klamath County, OR | Metro: Klamath 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 | $780 |
| 1 Bedroom | $870 |
| 2 Bedrooms | $1,130 |
| 3 Bedrooms | $1,570 |
| 4 Bedrooms | $1,890 |
| 5 Bedrooms | $2,192 |
| 6 Bedrooms | $2,455 |
| 7 Bedrooms | $2,651 |
| 8 Bedrooms | $2,784 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $870 | $146,272 | 0.59% | F |
| 2BR | $1,130 | $197,957 | 0.57% | F |
| 3BR | $1,570 | $327,707 | 0.48% | F |
| 4BR | $1,890 | $413,055 | 0.46% | F |
| 5BR | $2,192 | $480,626 | 0.46% | F |
U.S. Census Bureau data (2024)
The classification of ZIP 97601 (Klamath Falls, OR) hinges on the balance between yield and stability. With a Fair Market Rent (FMR) of $1,200 for the metro area in fiscal year 2026, compared to a market rent of $1,152, the yield potential is moderate. However, the average home value stands at $273,516, which is relatively low, suggesting that rental properties could be acquired at a lower cost than in many other areas.
Stability indicators point towards a less volatile but not exceptionally secure market. The rental rate of 40.0% implies a decent demand for rentals, though it is not particularly high. A Days on Market (DOM) of 65 days for listings indicates that it takes some time to find tenants, which can be seen as a mixed signal—while it's not excessively long, it does suggest competition among landlords or a slightly slower rental market.
Income levels in the area, with an average of $51,780, are modest and could affect the ability of potential tenants to afford higher rents. This figure supports the idea that the rental market might be more sensitive to economic fluctuations, thereby reducing overall stability.
Combining these factors, ZIP 97601 leans toward being a steady-cashflow zone. The relatively low home values make it attractive for investors looking to enter the market without a large upfront investment. The FMR slightly above market rent suggests there is room for profit, but the figures do not indicate a high-yield environment. The 40.0% rental rate and 65-day DOM indicate a stable demand for rentals, but not a highly competitive market where quick flips are common.
To summarize, the key figures driving this assessment are:
These conditions favor a buy-and-hold strategy over a rapid turnover approach, making it a suitable location for those seeking consistent cash flow rather than high yields or quick profits.
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.