Location: Bellingham, 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 | $1,500 |
| 1 Bedroom | $1,540 |
| 2 Bedrooms | $1,890 |
| 3 Bedrooms | $2,570 |
| 4 Bedrooms | $3,160 |
| 5 Bedrooms | $3,666 |
| 6 Bedrooms | $4,106 |
| 7 Bedrooms | $4,434 |
| 8 Bedrooms | $4,656 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,890 | $510,198 | 0.37% | F |
| 3BR | $2,570 | $616,497 | 0.42% | F |
| 4BR | $3,160 | $717,100 | 0.44% | F |
U.S. Census Bureau data (2024)
A landlord considering ZIP 98247 in Washington for a Section 8 investment must evaluate several key factors:
1. Debt Service Coverage Ratio (DSCR): The Fair Market Rent (FMR) for ZIP 98247 in fiscal year 2024 is $1570. To determine if this clears debt service on a property valued at $607,879, calculate the DSCR. Assuming a typical mortgage rate and term, the monthly debt service would be approximately $2800. Therefore, the FMR of $1570 does not cover the debt service, leading to a No. This makes the property unsuitable for Section 8 without additional rental income or subsidies.
2. Market Rent vs. FMR: The Zillow Observed Rental Index (ZORI) indicates that the average market rent in ZIP 98247 is $2000. Since this is above the FMR of $1570, it suggests that landlords can potentially charge more than the FMR for non-Section 8 tenants. However, this also means that Section 8 tenants may struggle to find units that accept their vouchers, leading to lower demand for Section 8 properties. The answer here is It Depends, but leans towards a challenge due to the gap between market rents and FMR.
3. Demand Assessment: In ZIP 98247, 27.2% of residents are renters. Unfortunately, the Days on Market (DOM) data is not available, which is crucial for understanding how quickly rental properties are filled. Without this information, it's difficult to assess whether there is sufficient demand for Section 8 properties. The answer is It Depends.
If the landlord's primary goal is to ensure that the rental income covers the mortgage payments, then the answer is No. The FMR of $1570 is insufficient to meet the debt service requirement of approximately $2800 per month.
However, if the landlord plans to supplement the Section 8 income with higher-paying non-Section 8 tenants or other sources of revenue, the answer shifts to Yes. The market rent being $2000 suggests potential for higher income from non-Section 8 tenants, which could offset the shortfall.
The demand assessment is inconclusive without DOM data. If the area has low DOM, indicating strong rental demand, then the 27.2% of renters could support a Section 8 property. Conversely, high DOM would suggest weak demand and make the investment less viable.
In summary, while ZIP 98247 offers opportunities for landlords to charge above FMR, the FMR itself is insufficient to cover debt service. The decision to invest should be made with careful consideration of these points and ideally supplemented by additional research into local rental 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.