Location: Mount Vernon-Anacortes, WA | Metro: Bellingham, WA 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 | $1,560 |
| 1 Bedroom | $1,600 |
| 2 Bedrooms | $1,960 |
| 3 Bedrooms | $2,660 |
| 4 Bedrooms | $3,270 |
| 5 Bedrooms | $3,793 |
| 6 Bedrooms | $4,248 |
| 7 Bedrooms | $4,588 |
| 8 Bedrooms | $4,817 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,600 | $399,054 | 0.4% | F |
| 2BR | $1,960 | $521,905 | 0.38% | F |
| 3BR | $2,660 | $692,920 | 0.38% | F |
| 4BR | $3,270 | $867,764 | 0.38% | F |
| 5BR | $3,793 | $949,396 | 0.4% | F |
U.S. Census Bureau data (2024)
A skeptical investor considering ZIP 98229, Bellingham, WA, might raise several valid concerns regarding the financial viability of renting properties under the Section 8 program. Here are some key objections and their corresponding analyses based on available data.
Objection 1: Will Fair Market Rent (FMR) of $1,640 for the fiscal year 2024 cover the mortgage on a $694,477 home?
The FMR of $1,640 is set to ensure that low-income families can afford decent housing. However, this amount does not directly correlate to the mortgage payment required for a $694,477 home. A typical mortgage payment for such a property, assuming a 30-year fixed-rate loan at an average interest rate of 4.5%, would be approximately $3,400 per month. Clearly, the FMR of $1,640 will not cover the mortgage payment. This highlights the need for landlords to consider other sources of income or potential subsidies if they wish to make renting to Section 8 tenants financially viable.
Objection 2: Is there enough renter demand at 30.3%?
The rental market in ZIP 98229 has a renter occupancy rate of 30.3%. While this percentage indicates that a significant portion of the housing stock is rented, it does not provide a complete picture of the demand. To fully assess the market, we must also look at vacancy rates and the overall supply of rental units. If the vacancy rate is high, there may be less demand for new rentals even at the 30.3% rate. Conversely, if the vacancy rate is low, there could be strong competition among renters, making it easier to fill units. The data provided does not specify the vacancy rate, so further investigation into local rental trends is necessary.
Objection 3: Will vouchers keep pace with $2,200 market rents?
In ZIP 98229, the average market rent is $2,200. Given that the FMR is significantly lower at $1,640, landlords might wonder whether voucher amounts will keep up with market conditions. The Housing Choice Voucher program aims to cover 30% of the unit's market rent, but there are caps on how much can be paid. If the voucher amount does not reach $2,200, landlords might face the risk of having to subsidize the difference. It's important to note that while the FMR is a guideline, individual voucher amounts can vary based on the tenant's income and the landlord's willingness to accept the voucher. Landlords should review the specific terms and limits of the vouchers before accepting them.
In conclusion, while ZIP 98229 offers opportunities for landlords and small-portfolio investors interested in Section 8 properties, careful consideration of the financial realities and market conditions is essential. The data suggests that the FMR will not cover the mortgage on a $694,477 home, and the rental demand is moderate. Whether vouchers will keep pace with market rents remains uncertain without additional context on the local housing market dynamics.
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.