Nashville Fair Market Rent Rises in HUD's 2027 Schedule as Clarksville's Falls
Nashville fair market rent benchmarks rose for fiscal 2027 under HUD's new schedule, while Clarksville's fell. What the figures measure and what they omit.
Franklin, Tenn. — October 25, 2026 — The Nashville fair market rent for a two-bedroom unit rose 3.9% to $1,798 a month in the U.S. Department of Housing and Urban Development's fiscal 2027 schedule, which took effect Oct. 1. The same schedule lowered the benchmark for the Clarksville area, giving Middle Tennessee rental investors two federal rent figures moving in opposite directions.
Nashville fair market rent by unit size
HUD's Nashville-Davidson--Murfreesboro--Franklin fair market rent area covers 10 counties: Cannon, Cheatham, Davidson, Dickson, Robertson, Rutherford, Sumner, Trousdale, Williamson and Wilson. Every unit size rose from fiscal 2026 to fiscal 2027.
| Unit size | FY2026 FMR | FY2027 FMR | Change |
|---|---|---|---|
| Efficiency | $1,507 | $1,585 | 5.2% |
| One-bedroom | $1,578 | $1,650 | 4.6% |
| Two-bedroom | $1,730 | $1,798 | 3.9% |
| Three-bedroom | $2,211 | $2,309 | 4.4% |
| Four-bedroom | $2,696 | $2,799 | 3.8% |
Source: U.S. Department of Housing and Urban Development, HUD USER FY2027 Fair Market Rent documentation. Percent changes calculated by Iron Hill Brief.
The Clarksville, TN-KY area, which includes Montgomery County, Tenn., and Christian and Trigg counties in Kentucky, moved the other way. Its two-bedroom fair market rent fell 2.9% to $1,307, and its three-bedroom figure fell 4.5% to $1,786, according to HUD.
What a fair market rent measures
Fair market rents are not asking rents. HUD sets them mainly to determine payment standards for the Housing Choice Voucher program and rent limits in several other federal housing programs, and its calculations are built on 40th-percentile rents. They are gross rents, which include utilities, and they apply to an entire multi-county area rather than a neighborhood or property.
HUD's documentation shows how the Nashville figure was built. The starting point was a two-bedroom gross rent of $1,404 from the Census Bureau's 2020-2024 American Community Survey. HUD then applied a recent-mover adjustment: in the 2024 one-year survey, renters who had recently moved reported a comparable two-bedroom rent of $1,702, a factor of about 1.21. Inflation and trend factors carried the result forward to fiscal 2027. The adjustment is HUD's way of accounting for the gap between what longtime tenants pay and what recent movers pay.
What the figures mean for Tennessee rental investors
For an investor sizing up a Middle Tennessee rental, the new schedule is a public, consistent benchmark that can be compared year to year and area to area. It is not a substitute for a property-level rent estimate. Lenders that evaluate a rental's income, such as on a debt service coverage ratio loan, use their own methods to estimate rent, and requirements vary by lender.
Iron Hill Brief's guide to the DSCR loan in Tennessee explains how a property's rent is weighed against its debt service, and overview details on DSCR loans cover the property types and documentation involved.
Working on a Tennessee rental? Talk with an Iron Hill loan advisor: text Ashley at 615-949-4780 or book a time here. Iron Hill Mortgage | NMLS #1946451.
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Sources
- U.S. Department of Housing and Urban Development, HUD USER, FY2027 Fair Market Rent documentation, Nashville-Davidson--Murfreesboro--Franklin, TN HUD Metro FMR Area (accessed Oct. 23, 2026): https://www.huduser.gov/datasets/fmr/fmr2027/summary?hmfa=METRO34980M34980&reporttype=hmfa&sa_override=1&year=2027
- U.S. Department of Housing and Urban Development, HUD USER, FY2027 Fair Market Rent documentation, Clarksville, TN-KY HUD Metro FMR Area (accessed Oct. 23, 2026): https://www.huduser.gov/datasets/fmr/fmr2027/summary?hmfa=METRO17300M17300&reporttype=hmfa&sa_override=1&year=2027
- U.S. Department of Housing and Urban Development, "Fair Market Rents for the Housing Choice Voucher Program, Moderate Rehabilitation Single Room Occupancy Program, and Other Programs, Fiscal Year 2027," 91 FR 56156 (Sept. 1, 2026): https://www.federalregister.gov/documents/2026/09/01/2026-17891/fair-market-rents-for-the-housing-choice-voucher-program-moderate-rehabilitation-single-room
- U.S. Department of Housing and Urban Development, Reevaluation Requests for FY 2027 Fair Market Rents: https://www.huduser.gov/portal/datasets/fmr/fmr2027/Reevaluation-Requests-FY27-FMRs.pdf
- U.S. Department of Housing and Urban Development, HUD USER, Fair Market Rents overview (program uses): https://www.huduser.gov/portal/datasets/fmr.html