Location: Jefferson County, WA | Metro: Jefferson County, WA
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 | $1,270 |
| 1 Bedroom | $1,390 |
| 2 Bedrooms | $1,640 |
| 3 Bedrooms | $2,270 |
| 4 Bedrooms | $2,740 |
| 5 Bedrooms | $3,178 |
| 6 Bedrooms | $3,559 |
| 7 Bedrooms | $3,844 |
| 8 Bedrooms | $4,036 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,390 | $516,331 | 0.27% | F |
| 2BR | $1,640 | $627,558 | 0.26% | F |
| 3BR | $2,270 | $689,297 | 0.33% | F |
| 4BR | $2,740 | $810,404 | 0.34% | F |
| 5BR | $3,178 | $993,387 | 0.32% | F |
U.S. Census Bureau data (2024)
A landlord considering purchasing a property in ZIP code 98368 (Port Townsend, WA) for Section 8 investment should follow this decision tree:
Step 1: Can FMR ($1,400) cover debt service on a $632,316 property?
No: The Fair Market Rent (FMR) of $1,400 per month does not sufficiently cover the debt service on a property valued at $632,316. This makes it financially unviable to invest in this area solely based on Section 8 income.
Yes: Proceed to Step 2.
It Depends: Consider other income streams or subsidies that could help bridge the gap between FMR and debt service costs.
Step 2: How does market rent ($2,754 ZORI) compare to FMR?
Market Rent Above FMR: The Zillow Observed Rent Index (ZORI) of $2,754 is significantly higher than the FMR of $1,400. This indicates a strong market for private rentals but weakens the appeal of Section 8 as the primary tenant source due to lower rental income compared to market rates.
Market Rent Equal to or Below FMR: This scenario would not apply given the provided data. However, if market rent were equal to or below FMR, it would be more favorable for Section 8 investments as the gap between market and subsidized rents would be smaller or non-existent.
Step 3: Is there sufficient demand with 26.1% renters and N/A-day days on market (DOM)?
No: Given the lack of data on days on market (DOM), it's difficult to assess how quickly properties are rented out. However, the 26.1% of renters suggests a moderate demand for rental housing, which might not be sufficient to sustain an investment relying primarily on Section 8 tenants.
Yes: If DOM data were available and indicated quick turnover, then the 26.1% of renters could be seen as sufficient demand. However, without DOM data, this conclusion cannot be definitively reached.
It Depends: The viability of investing in ZIP 98368 for Section 8 tenants hinges on the actual DOM data and the landlord's willingness to accept a lower rental income compared to the market rate. Additionally, consider the availability of Section 8 vouchers and the competition from other landlords offering market-rate rents.
In summary, the financial feasibility of a Section 8 investment in ZIP 98368 is questionable due to the high property value and low FMR relative to market rent. Landlords must weigh these factors carefully and seek additional data on DOM to make an informed decision.
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.