Section 8 Fair Market Rent (FMR) for ZIP 98837 - 2027

Investment Score for ZIP 98837

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,040
1 Bedroom	$1,050
2 Bedrooms	$1,370
3 Bedrooms	$1,860
4 Bedrooms	$2,290
5 Bedrooms	$2,656
6 Bedrooms	$2,975
7 Bedrooms	$3,213
8 Bedrooms	$3,374

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$1,050	$226,756	0.46%	F
2BR	$1,370	$250,099	0.55%	F
3BR	$1,860	$350,653	0.53%	F
4BR	$2,290	$448,169	0.51%	F
5BR	$2,656	$551,282	0.48%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 98837 (Moses Lake, WA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) figures for ZIP code 98837 in Moses Lake, WA, for 2026 are as follows: - 0BR: $950 - 1BR: $960 - 2BR: $1260 - 3BR: $1750 - 4BR: $2110 These FMRs represent the maximum amount that a Section 8 voucher holder can pay for rent based on the number of bedrooms needed. However, the actual rental market in Moses Lake is significantly higher. For instance, the Zillow median price for a 2BR property is $245,196, which translates to a monthly rental cost of approximately $1,529 assuming a 5% cap rate. This is nearly 20% above the FMR for a 2BR unit, indicating a substantial gap between what voucher holders can afford and the actual market rates. Given these dynamics, voucher holders face significant constraints. They must find landlords willing to accept lower rent payments, which can be challenging given the high demand and limited supply of affordable housing. Additionally, the occupancy rate of 94.8% suggests that there is little vacancy for voucher holders to leverage, further tightening their options. #### Affordability & Renter Profile The median household income in Moses Lake is $74,586, and 33.4% of the population are renters. The affordability of housing is a critical issue, especially for those relying on Section 8 vouchers. A 2BR unit at the FMR of $1260 represents about 20.3% of the median income, which is relatively affordable compared to other markets. However, the actual rental costs far exceed this figure, making it difficult for many residents to find suitable housing. The market appears to be tight, with high occupancy rates and limited affordable options. This situation benefits current landlords but poses challenges for renters, particularly those with limited financial resources. The disparity between FMR and actual market prices indicates a potential mismatch between supply and demand, with a significant portion of the rental market being unaffordable for voucher holders. #### Investor Angle From an investor perspective, the ZIP code 98837 presents both opportunities and challenges. The price-to-FMR ratio of 16.2x for a 2BR unit highlights the premium that properties command in the local market. Assuming a typical cap rate of 5%, the expected rental income for a 2BR property would be around $1,529 per month. However, the FMR limits the rent to $1260, resulting in a negative cash flow of approximately $269 per month. This negative cash flow scenario suggests that investing in this ZIP code purely for Section 8 tenants may not be financially viable without additional subsidies or incentives. The investment grade would be considered low due to the high acquisition costs relative to the allowable rental income under the Section 8 program. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should consider smaller units such as 0BR or 1BR properties. These units have FMRs of $950 and $960 respectively, which might be closer to the actual rental market prices for smaller units. This could potentially reduce the negative cash flow impact. 2. **Seek Additional Subsidies**: Investors looking to acquire properties in this ZIP code should explore additional government programs or local subsidies that could help bridge the gap between the FMR and the actual rental market prices. This could include state-level housing assistance programs or tax incentives for affordable housing. 3. **Consider Long-Term Appreciation**: While the immediate cash flow might be negative, investors should also consider the long-term appreciation potential of properties in Moses Lake. If the local economy continues to grow and attract new residents, property values could increase over time, providing a capital gain opportunity that offsets the initial negative cash flow. #### Bottom Line For Section 8-focused investors, the recommendation for ZIP code 98837 is to **Skip**. The high price-to-FMR ratio and the resulting negative cash flow make it less attractive for immediate returns. However, if an investor is willing to take a longer-term view and can secure additional subsidies, there might be potential for capital gains. Nonetheless, the current market conditions suggest that the immediate financial viability is low, and thus, skipping this ZIP code is advised unless there are significant mitigating factors or long-term strategic plans in place.

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.