Section 8 Fair Market Rent (FMR) for ZIP 98103 - 2027

Investment Score for ZIP 98103

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	$2,460
1 Bedroom	$2,570
2 Bedrooms	$3,000
3 Bedrooms	$3,910
4 Bedrooms	$4,650
5 Bedrooms	$5,394
6 Bedrooms	$6,041
7 Bedrooms	$6,524
8 Bedrooms	$6,850

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
1BR	$2,570	$408,620	0.63%	D
2BR	$3,000	$733,054	0.41%	F
3BR	$3,910	$945,936	0.41%	F
4BR	$4,650	$1,306,016	0.36%	F
5BR	$5,394	$1,499,860	0.36%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 98103 (Seattle, WA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 98103 in Seattle, WA, is set by HUD for 2026. The FMRs are as follows: - 0BR: $2480 - 1BR: $2570 - 2BR: $2990 (which represents 27.4% of the median household income) - 3BR: $3910 - 4BR: $4600 To understand how these FMRs compare to actual rents, we need to consider that the FMR is a benchmark used to determine the maximum rent subsidy for Section 8 voucher holders. However, actual rents can be significantly higher, especially in a high-demand area like Seattle. For instance, the Zillow median price for a 2-bedroom property in ZIP 98103 is $753,434, which is 21.0 times the FMR for a 2BR unit. This indicates that the actual rental market is much more expensive than the FMR suggests. Voucher holders face significant constraints because the FMR is often lower than what landlords charge in this competitive market. A tenant with a Section 8 voucher might struggle to find a landlord willing to accept a rent of $2990 for a 2BR unit when the market rent could be several times higher. #### Affordability & Renter Profile ZIP code 98103 has a population of 52,671, with 55.6% of residents being renters. The occupancy rate stands at 93.9%, indicating a highly sought-after neighborhood where most units are occupied. Given the median household income of $131,154, it is clear that the majority of residents can afford market-rate rents. However, the high proportion of renters suggests a strong demand for housing, particularly from individuals and families who may be priced out of homeownership. The affordability gap is starkly evident when comparing the FMR to the median household income. While the FMR for a 2BR unit is $2990, this represents only 27.4% of the median household income. This means that even if a family receives a Section 8 voucher, they would still have to pay a substantial portion of their income towards rent. In a market where the median price for a 2BR unit is $753,434, the rental market is likely to be similarly inflated, making it a tight market for those relying on vouchers. #### Investor Angle From an investor perspective, the ZIP code 98103 presents both opportunities and challenges. The high occupancy rate and strong rental demand suggest that there is potential for steady cash flow. However, the price-to-FMR ratio of 21.0x indicates that the market rents are far above the FMRs, which could limit the pool of potential tenants who can afford to live in the area using Section 8 vouchers. To assess whether this ZIP code is cash-flow positive at FMR, we must consider the typical rental yields and costs associated with owning and managing rental properties. If an investor purchases a 2BR unit for $753,434 and rents it out at the FMR of $2990, the annual rental income would be approximately $35,880. Assuming a conservative cost structure, including mortgage payments, maintenance, insurance, and property taxes, it is unlikely that this would result in a positive cash flow at the FMR level. Given the high market rents, an investor might need to consider renting at market rates rather than FMR to achieve positive cash flow. However, this would mean that the property would not be suitable for Section 8 voucher holders, who form a significant portion of the rental market. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Investors should focus on smaller units such as 0BR or 1BR apartments, which have FMRs of $2480 and $2570 respectively. These units are more likely to be affordable for Section 8 voucher holders, and the occupancy rate suggests that there will be sufficient demand. 2. **Consider Renovation Projects**: Given the high market rents, investors might find it more profitable to purchase older properties and renovate them to command higher rents. This strategy could also help in attracting non-voucher tenants who are willing to pay market rates, thereby ensuring better cash flow. 3. **Evaluate Property Management Costs**: Before investing in this ZIP code, it is crucial to evaluate the total cost of ownership, including property management fees, maintenance, and other expenses. This will help in determining whether the property can be rented profitably at FMR levels. #### Bottom Line For Section 8-focused investors, ZIP code 98103 presents a challenging environment due to the high market rents and limited availability of properties that can be rented at FMR levels. The recommendation for this ZIP code is to **Skip** unless you are prepared to focus on smaller units or consider a mixed-income approach where some units are rented at market rates and others at FMR. The high price-to-FMR ratio makes it difficult to achieve positive cash flow solely through Section 8 vouchers, and the tight market conditions suggest that competition for tenants will be fierce.

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.