Location: Seattle-Bellevue, WA | Metro: Seattle-Bellevue, WA HUD Metro FMR Area
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 | $1,970 |
| 1 Bedroom | $2,050 |
| 2 Bedrooms | $2,400 |
| 3 Bedrooms | $3,130 |
| 4 Bedrooms | $3,720 |
| 5 Bedrooms | $4,315 |
| 6 Bedrooms | $4,833 |
| 7 Bedrooms | $5,220 |
| 8 Bedrooms | $5,481 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $2,050 | $430,007 | 0.48% | F |
| 2BR | $2,400 | $521,360 | 0.46% | F |
| 3BR | $3,130 | $666,677 | 0.47% | F |
| 4BR | $3,720 | $881,915 | 0.42% | F |
| 5BR | $4,315 | $908,950 | 0.47% | F |
U.S. Census Bureau data (2024)
The analysis for Section 8 real estate in ZIP code 98272, located in Monroe, WA, reveals a significant gap between the Federal Market Rent (FMR) and the actual market rent. The FMR for 2024 is set at $2,500, while the Zillow Observed Rent Index (ZORI) indicates a market rent of $2,320. This means that the FMR exceeds the market rent by $180, or approximately 7.76%. In practical terms, this gap translates into an opportunity for landlords and small-portfolio investors.
The explicit $180 difference signifies that voucher tenants can provide a higher yield compared to open-market tenants. When the FMR is greater than the prevailing market rent, it allows landlords to receive a subsidy that covers the discrepancy, ensuring a consistent and reliable income stream. This scenario makes the investment in Section 8 properties particularly attractive, as it mitigates the risk associated with fluctuating market conditions and ensures a steady cash flow.
In the context of Monroe, WA, where only 19.3% of residents are renters, and the median home value stands at $734,146, the appeal of Section 8 properties becomes even more pronounced. With a median income of $122,352, many residents might find it challenging to afford market-rate rents, making the subsidized option a viable solution for both tenants and landlords. The higher FMR supports the financial viability of these investments, especially when considering the broader economic landscape of the area.
However, it's important to note that the cost of housing voucher tenants below open-market rates should also be considered. While the FMR provides a cushion against market volatility, landlords must adhere to certain regulations and standards set by the housing authority. These requirements can sometimes lead to additional expenses and administrative burdens. Nonetheless, the overall financial benefit of receiving a higher guaranteed rent through the voucher program outweighs these potential drawbacks.
To summarize, the gap between the FMR and the market rent in ZIP 98272 presents a clear yield advantage for landlords and small-portfolio investors. By leveraging this discrepancy, investors can secure a reliable income source that is insulated from market fluctuations, making Section 8 properties a valuable addition to their real estate portfolio in Monroe, WA.
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.