Location: Pend Oreille County, WA | Metro: Pend Oreille County, WA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $710 |
| 1 Bedroom | $780 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,320 |
| 4 Bedrooms | $1,700 |
| 5 Bedrooms | $1,972 |
| 6 Bedrooms | $2,209 |
| 7 Bedrooms | $2,386 |
| 8 Bedrooms | $2,505 |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 99153 provides a clear picture of potential investment yields based on the Federal Market Rent (FMR) and market rent data. For a two-bedroom unit, the annualized FMR stands at $970, while the market rent is reported at $712 per month according to the Census ACS data.
To derive the gross yield, we first calculate the annual rental income under both scenarios. With an FMR of $970 per month, the annual rental income would be $11,640. Dividing this by the median home value of $251,977 gives an implied gross yield of approximately 4.62%. In contrast, using the market rent of $712 per month, the annual rental income would be $8,544, resulting in an implied gross yield of about 3.39% when divided by the median home value.
The higher gross yield based on the FMR suggests a potentially more lucrative investment scenario for landlords participating in the Section 8 program. However, the reality of the situation must also consider the renter density and the days on market (DOM) statistics. ZIP code 99153 has a renter density of 38.0%, indicating a significant portion of residents are renters. This figure supports the likelihood of finding tenants willing to participate in the Section 8 program, thereby making the higher FMR-based yield more plausible.
The absence of DOM data complicates the analysis slightly, as it would typically help gauge the speed of property turnover and the effectiveness of rental pricing. Nevertheless, given the high median home value relative to the monthly rents, it's reasonable to infer that properties in this ZIP code may experience slower turnover, especially if market rents are lower than what might attract buyers.
In conclusion, the Section 8 cap-rate for ZIP code 99153 shows a gross yield of 4.62% based on the FMR, which is significantly higher than the 3.39% yield derived from the market rent. The higher yield aligns better with the observed renter density and the typical behavior of housing markets where median home values are notably higher than average rental incomes. Therefore, for small-portfolio investors and landlords, the Section 8 program presents a more attractive investment opportunity in ZIP code 99153 compared to relying solely on market rents.
Data Sources: FMR data from HUD (2027). 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.