Location: Tacoma, WA | Metro: Tacoma, WA HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,490 |
| 1 Bedroom | $1,680 |
| 2 Bedrooms | $2,060 |
| 3 Bedrooms | $2,840 |
| 4 Bedrooms | $3,210 |
| 5 Bedrooms | $3,724 |
| 6 Bedrooms | $4,171 |
| 7 Bedrooms | $4,505 |
| 8 Bedrooms | $4,730 |
The Section 8 program in ZIP code 98395 presents a unique opportunity for landlords and small-portfolio investors due to the disparity between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR stands at $1990. However, the current market rent data is unavailable, which complicates a direct comparison. In the absence of market rent figures, we must consider the implications of the FMR alone.
In Unknown, WA, where ZIP 98395 is located, the percentage of renters and the median home values are also not specified. Similarly, the median income for the area remains unknown. Despite these gaps in data, the FMR of $1990 provides a baseline for understanding the rental market dynamics.
If the FMR exceeds the market rent, it means that voucher tenants can afford higher rents than what the market currently dictates. This situation transforms the ZIP into a yield play, where landlords can potentially secure a steady stream of income through the Section 8 program without necessarily reducing their profit margins. The reliability of government-backed payments ensures a stable cash flow, making properties in this area attractive for those seeking consistent returns.
Conversely, if the FMR is lower than the market rent, landlords might face the challenge of accepting lower rents to accommodate voucher tenants. This scenario could reduce the profitability of properties compared to renting them at market rates. The cost of housing voucher tenants below open-market rates lies in the potential loss of income that could be earned from non-subsidized tenants willing to pay more. Landlords would need to weigh the benefits of guaranteed rent against the possibility of earning more through traditional market rentals.
The decision to participate in the Section 8 program should be informed by a thorough analysis of local rental trends, property management costs, and the landlord's financial goals. While the exact market rent and other demographic details for ZIP 98395 are not available, the FMR of $1990 serves as a critical reference point for any investment strategy involving subsidized housing.
Data Sources: FMR data from HUD (2027).
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.