Location: Grays Harbor County, WA | Metro: Grays Harbor 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 | $930 |
| 1 Bedroom | $1,040 |
| 2 Bedrooms | $1,340 |
| 3 Bedrooms | $1,860 |
| 4 Bedrooms | $2,110 |
| 5 Bedrooms | $2,448 |
| 6 Bedrooms | $2,742 |
| 7 Bedrooms | $2,961 |
| 8 Bedrooms | $3,109 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,340 | $202,198 | 0.66% | D |
| 3BR | $1,860 | $271,460 | 0.69% | D |
| 4BR | $2,110 | $296,373 | 0.71% | D |
U.S. Census Bureau data (2024)
The ZIP code 98550 encompasses a portion of Hoquiam, WA, characterized by a modest population size of 12,316 residents. Within this community, 33.3% of the populace are renters, indicating a significant demand for rental properties. The median household income here is $55,040, reflecting a middle-class area where affordability is key. This is further underscored by the median home value of $241,808, which suggests that homeownership is accessible but not overly abundant.
Moving into the realm of rent economics, the Fair Market Rent (FMR) for ZIP 98550, as set by HUD for metro areas in fiscal year 2026, is $1,200. This figure is notably lower than the market rent, measured by Zillow's ZORI index, at $1,525. This discrepancy presents an opportunity for landlords and small-portfolio investors to leverage the gap between government-supported rents and market rates.
Given these conditions, ZIP 98550 could be a suitable location for both hands-off voucher operators and hands-on value-add buyers. For hands-off operators, the presence of the Section 8 program ensures a steady stream of tenants who can afford the rent through government subsidies. However, the actual rents charged under the voucher program will be closer to the FMR of $1,200, meaning that landlords must be prepared to manage their properties efficiently to maintain profitability.
On the other hand, for hands-on investors looking to add value, there is room to improve property quality and increase rents toward the market rate of $1,525. This strategy requires a deeper understanding of the local market, tenant needs, and potential improvements that can command higher rents without alienating the existing tenant base.
In conclusion, ZIP 98550 offers a balanced environment for real estate investment, with opportunities for both passive income generation through the Section 8 program and active management aimed at maximizing returns. Investors should carefully consider their investment goals and risk tolerance before engaging in this market.
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.