Location: Klickitat County, WA | Metro: Portland-Vancouver-Hillsboro, OR-WA MSA
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 | $1,420 |
| 1 Bedroom | $1,510 |
| 2 Bedrooms | $1,730 |
| 3 Bedrooms | $2,360 |
| 4 Bedrooms | $2,800 |
| 5 Bedrooms | $3,248 |
| 6 Bedrooms | $3,638 |
| 7 Bedrooms | $3,929 |
| 8 Bedrooms | $4,125 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,510 | $459,381 | 0.33% | F |
| 2BR | $1,730 | $575,985 | 0.3% | F |
| 3BR | $2,360 | $722,535 | 0.33% | F |
| 4BR | $2,800 | $886,199 | 0.32% | F |
U.S. Census Bureau data (2024)
The Section 8 real estate thesis in ZIP code 98672, centered around White Salmon, WA, reveals a significant gap between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR is set at $1680, while the market rent, measured by ZORI, stands at $2375. This means there is a $695 difference, or approximately 41%, between what the government deems fair and what the market demands.
In White Salmon, where only 16.9% of residents are renters, and the median home value is $689,563 with a median income of $97,622, the implications of this gap are substantial. Landlords and small-portfolio investors should be aware that accepting Section 8 vouchers means renting out properties at a rate that is significantly below the open-market rent. This discrepancy can impact the overall profitability of their investment, especially when considering maintenance costs, property taxes, and other expenses that come with property ownership.
The cost of housing voucher tenants below open-market rates is not just financial but also operational. While the FMR is designed to cover the rental costs for low-income families, it does not necessarily align with the landlord's profit expectations. In an area where homeownership is the norm and incomes are relatively stable, landlords might find themselves under pressure to manage properties effectively while operating on a lower margin.
However, the Section 8 program provides stability and a consistent stream of income, which can be beneficial for long-term investment strategies. Despite the initial lower rent compared to the market rate, the program ensures timely payments and tenant support, reducing the risk of vacancies and delinquencies. For investors looking to balance yield with social responsibility, Section 8 properties in ZIP 98672 offer a unique opportunity to serve the community while maintaining a steady income flow.
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.