What is Fair market rent (FMR)?
Fair market rent is the maximum rent amount set by the U.S. Department of Housing and Urban Development for each county or metropolitan area, used to establish payment standards for housing voucher programs.
The U.S. Department of Housing and Urban Development (HUD) calculates Fair Market Rent annually for every county and metropolitan area in the country to reflect current rental costs in each local market. These figures serve as the ceiling for housing voucher payments, determining how much a public housing agency can reimburse landlords on behalf of tenants.
HUD derives FMR by analyzing rental data from the American Community Survey, the decennial census, and other sources to estimate the 40th percentile of rentals for unfurnished, decent quality apartments. The calculation accounts for bedroom size (zero through four bedrooms), so each area has separate FMR figures depending on unit type. Texas counties and metro areas like Harris County (Houston), Dallas County, and the Austin-Round Rock area receive distinct FMR schedules that reflect their particular housing markets.
Payment standards for low-income housing program vouchers are anchored to these FMR figures, either set at 100 percent of FMR or at a lower local percentage. Landlords cannot legally charge more than the established payment standard, even if the actual market rent is higher. This protects both program budgets and ensures voucher holders can find available housing within their allowance, making FMR a foundational tool for administering rental assistance across the state.