Section 8 Fair Market Rent (FMR) for ZIP 98345 - 2027

FY 2027 Fair Market Rent Rates

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

A decision tree for whether to invest in ZIP code 98345 for Section 8 properties starts with a few key questions based on the data available.

1. Does the Fair Market Rent (FMR) of $2,280 cover the debt service on a property priced at $585,249?

• No: The FMR of $2,280 does not sufficiently cover the debt service for a property costing $585,249. Debt service typically includes mortgage payments, property taxes, insurance, and maintenance costs. Given that the FMR is set by HUD and represents the maximum rental amount allowed for Section 8 housing vouchers, you would need to ensure that your total annual expenses do not exceed the income generated by this FMR. For a property of this value, it is unlikely that the FMR will be sufficient to cover all these costs.

2. How does the market rent of $2,182 compare to the FMR?

• Below FMR: The market rent of $2,182 is below the FMR of $2,280. This suggests that the local rental market may be slightly less favorable for non-assisted tenants, but it also indicates that properties can be rented out at or near the FMR without significant price adjustments. Landlords who are willing to participate in the Section 8 program can charge closer to the FMR, which is higher than the average market rent.

3. Is there enough demand with 50.5% of residents being renters and an unknown number of days on the market (DOM)?

• It Depends: With 50.5% of residents renting, there is a substantial portion of the population that relies on the rental market. However, the lack of data on the days on the market (DOM) makes it difficult to assess how quickly units might be filled. A high DOM could indicate low demand, while a low DOM suggests strong demand. Without this information, the decision hinges on other factors such as the landlord's ability to manage a Section 8 property and their tolerance for potentially slower turnover rates.

In summary, the decision to purchase in ZIP 98345 for Section 8 properties is contingent upon your financial model and willingness to operate within the constraints of the program. The FMR does not cover the debt service on a $585,249 property, and while the market rent is below the FMR, indicating potential stability in pricing, the lack of DOM data means demand certainty is limited. Consider consulting local real estate experts or examining additional market indicators to make a fully informed decision.

Data Sources: FMR data from HUD (2027). 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.