Location: Yukon-Koyukuk Census Area, AK | Metro: Yukon-Koyukuk Census Area, AK
| Unit Size | Monthly FMR |
|---|---|
| Studio | $950 |
| 1 Bedroom | $960 |
| 2 Bedrooms | $1,200 |
| 3 Bedrooms | $1,660 |
| 4 Bedrooms | $1,970 |
| 5 Bedrooms | $2,285 |
| 6 Bedrooms | $2,559 |
| 7 Bedrooms | $2,764 |
| 8 Bedrooms | $2,902 |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 99602 presents a unique challenge due to the absence of median home values. However, we can still provide insights based on available data.
First, let's annualize the Federal Market Rent (FMR) for a 2-bedroom unit at $1,130 per month, which equates to an annual rental income of $13,560. This figure is derived from the FY 2026 metro data. If we consider this as the rental income for a property in 99602, the implied gross yield would be calculated by dividing the annual rental income by the property value. Given the median home value is not available, we cannot calculate the exact gross yield, but it's clear that this scenario would result in a higher gross yield compared to typical market rents.
Next, let's look at the market rent of $485 per month, as reported by the Census ACS. This translates to an annual rental income of $5,820. Again, without a median home value, we cannot determine the precise gross yield, but it's evident that this would produce a lower gross yield than the FMR scenario.
The gross yield comparison between these two scenarios is stark. The FMR scenario, tied to Section 8 rates, offers a significantly higher annual rental income, implying a better gross yield for investors. In contrast, the market rent scenario provides a much lower annual rental income, suggesting a less favorable gross yield.
Given the 19.0% renter density in ZIP 99602, it's important to note that a substantial portion of the population might not be able to afford market rents. Therefore, the FMR scenario could be more realistic, as it aligns with government-subsidized rates that aim to ensure housing affordability for low-income residents.
The days on market (DOM) data being unavailable also impacts the analysis. Typically, a higher DOM indicates slower sales, which could suggest that properties in 99602 might take longer to sell if needed. This factor, combined with the high FMR relative to market rents, suggests that landlords and small-portfolio investors should focus on the stability and predictability of Section 8 rents rather than speculative gains from property appreciation.
In conclusion, while the exact cap rate cannot be determined without the median home value, the FMR scenario provides a clearer path for stable, predictable returns in ZIP 99602, making it a more realistic option for investors considering the local renter demographics.
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.