FY2012 Fair Market Rent Documentation System

The $fmrtype$ FY2012 Cumberland County FMRs for All Bedroom Sizes

The following table shows the $fmrtype$ FY2012 FMRs by unit bedrooms for Cumberland County.

$fmrtype$ FY2012 FMRs By Unit Bedrooms
  Efficiency One-Bedroom Two-Bedroom Three-Bedroom Four-Bedroom
$fmrtype$ FY2012 FMR $388 $484 $584 $777 $1,024

FY2012 FMR areas continue to use the revised Office of Management and Budget (OMB) area definitions that were first issued in 2003 along with HUD defined Metropolitan areas (HMFAs) as described in the FY2011 FMR documentation which can be found at (Cumberland County FY2011 FMR Documentation system). No changes have been made to these OMB-defined areas since the publication of Final FY2011 FMRs


Fair Market Rent Calculation Methodology - New for FY2012

Fair Market Rents for metropolitan areas and non-metropolitan FMR areas are developed as follows:

  1. 2005-2009 5-year ACS estimates of 2-bedroom adjusted standard quality rents calculated for each FMR area are used as the new basis for FY2012.

  2. In areas where the 2009 5-year ACS estimates are smaller than the reported margin of error, the state non-metro estimate of 2-bedroom adjusted standard quality rent is used.

  3. HUD calculates a recent-mover adjustment factor by comparing a 2009 1-year adjusted recent-mover 2-bedrooom rent to the 5-year adjusted standard quality rent for the same area in the following manner:

    1. In areas where there are at least 100 observations included in the 2009 1-year ACS estimate of 2-bedroom recent-mover rents, a statistical comparison is made between the 5-year 2-bedroom adjusted standard quality rent and the 1-year 2-bedroom recent-mover rent available from the ACS.

      • If the 1-year data are statistically different than the 5-year data, HUD calculates a recent-mover adjustment factor between the 5-year data and the 1-year data and applies this to the 5-year data. This recent-mover adjustment factor is floored at 1.0.

      • If the 1-year data are not statistically different than the 5-year data, HUD applies a recent-mover adjustment factor of 1 to the 5-year data.

    2. In areas where there are less than 100 observations of 2009 1-year ACS estimate of 2-bedroom recent-mover rent, a statistical comparison is made between the 5-year 2-bedroom adjusted standard quality rent and the 1-year 2-bedroom recent-mover rent for smallest geographic area containing the FMR area with at least 100 available observations of 2009 1-year ACS estimate of 2-bedroom recent-mover rent. For metropolitan areas, the order of geographies examined is: Entire Metropolitan Area (for Metropolitan Sub-Areas), State Metropolitan Portion, Entire State, and Entire US; for non-metropolitan areas, the order of geographies examined is: State Non-Metropolitan Portion, Entire State, and Entire US.

      • If the 1-year data are statistically different than the 5-year data, HUD calculates a recent-mover adjustment factor between the 5-year data and the 1-year data and applies this to the 5-year data.

      • If the 1-year data are not statistically different than the 5-year data, HUD applies a recent-mover adjustment factor of 1 to the 5-year data.

  4. Rents are calculated as of December 2010 using one half of the relevant (regional or local) 2008-2009 CPI change and all of the relevant (regional or local) 2009-2010 CPI change.

  5. All estimates are then trended from December 2010 to April 2012 (15 months) with a trending factor of 3 percent per year.

  6. FY2012 FMRs are then compared to a state minimum rent, and any area whose preliminary FMR falls below this value is raised to the level of the state minimum.


The results of the Fair Market Rent Step-by-Step Process

Cumberland County, IL Results

  1. The following are the 2009 American Community Survey 5-year 2-Bedroom Adjusted Standard Quality Rent estimate and margin of error for Cumberland County, IL:

    Area ACS2009 5-Year
    2-Bedroom Adjusted
    Standard Quality Rent
    ACS2009 5-Year
    2-Bedroom Adjusted
    Standard Quality Rent
    Margin of Error
    Ratio Result
    Cumberland County, IL $496 $39 $39 / $496
    =
    0.079
    0.079 < 1

    Use ACS2009 5-Year Cumberland County, IL
    2-Bedroom Adjusted Standard Quality Rent

    Since the ACS2009 Margin of Error ratio is less than 1, the ACS2009 Cumberland County, IL value is used for the estimate of 2-Bedroom Adjusted Standard Quality Rent:

    Area ACS2009 Rent
    Cumberland County, IL $496


  2. A recent-mover adjustment factor is applied based on the smallest area of geography which contains Cumberland County, IL and has at least 100 Adjusted Standard Quality Recent-Mover observations in the ACS2009 1-year estimate:

    Geography 100 ACS2009 1-Year Adjusted
    Standard Quality Recent-Mover Observations?
    County No
    State Non-Metro Yes

    The smallest area of geography which contains Cumberland County, IL and has at least 100 Adjusted Standard Quality Recent-Mover observations in the ACS2009 1-year estimate is the non-metropolitan portion of Illinois.


  3. The calculation of the relevant Recent-Mover Adjustment Factor for Cumberland County, IL is as follows:

    ACS2009 5-Year
    Area
    ACS2009 5-Year
    2-Bedroom Adjusted
    Standard Quality Rent
    ACS2009 5-Year
    2-Bedroom Adjusted
    Standard Quality Rent
    Margin of Error
    ACS2009 1-Year
    2-Bedroom Adjusted
    Standard Quality
    Recent-Mover Rent
    ACS2009 1-Year
    2-Bedroom Adjusted
    Standard Quality
    Recent-Mover Rent
    Margin of Error
    Illinois Non-Metro $537 $5 $571 $13

    Area Z Score Result Recent-Mover
    Adjustment Factor
    Illinois Non-Metro

    Z=
    $571 - $537

    ($132 + $52)

    Z=
    $34

    ($169 + $25)

    Z=
    $34

    $194

    Z=
    $34

    $14

    Z = 2.441

    2.441 >= 1.645

    ACS2009 1-Year Significant
    $571 / $537
    =
    1.0633


  4. The calculation of the relevant 2009-to-2012 Update Factors for Cumberland County, IL is as follows:

    HUD updates the 2009 intermediate rent (as of June 2009) with the appropriate CPI change (local or regional) to establish rents as of December 2010. HUD then applies additional trending or results of Random Digit Dialing (RDD) surveys to update rents to April, 2012, the mid-point of FY 2012.

    Year Update Factor Type
    June 2009 to 2010 1.018887 Regional CPI
    2010 to April 2012 1.03764 Trending
    3.0% for 1.25 years


  5. The FY2012 2-Bedroom Fair Market Rent for Cumberland County, IL is calculated as follows:

    Area ACS2009 5-Year Estimate Recent-Mover
    Adjustment Factor
    CPI Adjustment Trending
    3.0% for 1.25 years
    FY2012 2-Bedroom FMR
    Cumberland County, IL $496 1.0633 1.018887 1.03764 $496 * 1.06331 * 1.01889 * 1.03764
    =
    $558


  6. In keeping with HUD policy, the preliminary FY2012 FMR is checked to ensure that is does not fall below the state minimum for Illinois:

    Area Preliminary FY2012
    2-Bedroom FMR
    FY2012 Illinois
    State Minimum
    $fmrtype$ FY2012
    2-Bedroom FMR
    Cumberland County, IL $558 $584 $558 < $584

    Use Illinois minimum
    $584


Final FY2012 Rents for All Bedroom Sizes for Cumberland County, IL

The following table shows the $fmrtype$ FY 2012 FMRs by bedroom sizes.
The State Minimum-Based FMRs for units with different numbers of bedrooms are computed from the ratio of the unadjusted 2005 Revised FMRs (based on 2000 Decennial Census Data) for the different unit sizes to the unadjusted 2005 2-Bedroom Revised Final FMR. These Rent Ratios are applied to the the $fmrtype$ FY2012 State Minimum 2-Bedroom FMR for Illinois of $584 to determine the $fmrtype$ FY2012 FMRs for the different size units.

Click on the links in the table to see how the unadjusted bedroom rents were derived.

$fmrtype$ FY2012 FMRs By Unit Bedrooms
  Efficiency One-Bedroom Two-Bedroom Three-Bedroom Four-Bedroom
Unadjusted FY2012 FMR $371 $462 $558 $743 $979
Unadjusted Rent Ratio 0.665 0.828 1.000 1.331 1.754
State Minimum-Based $fmrtype$ FY2012 FMR $388 $484 $584 $777 $1,024

The FMRs for unit sizes larger than four bedrooms are calculated by adding 15 percent to the four bedroom FMR, for each extra bedroom. For example, the FMR for a five bedroom unit is 1.15 times the four bedroom FMR, and the FMR for a six bedroom unit is 1.30 times the four bedroom FMR. FMRs for single-room occupancy units are 0.75 times the zero bedroom (efficiency) FMR.


Data file last updated Thu., Sep 22, 2011.


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