The Efficiency FMR for Sioux Falls, SD MSA is based on the ratio of the rent estimate for Efficiency Units to the rent estimate rent estimate for 2 bedroom units. For geographic levels smaller than metropolitan areas, the estimate of Efficiency rent is the average of the past three estimates from the most recent American Community Survey 5-Year releases. If an area does not have a reliable local rent estimate, the ratio is based on rent estimates for its larger containing geographic area. This ratio is multiplied by the 2 bedroom FY 2017 Fair Market Rent (FMR) to obtain the Efficiency for FY 2017.
The tables below provide the relevant steps for computing the FY 2017 Efficiency FMR:
Check the Margin of Error Ratios for Sioux Falls, SD MSA. If either the Efficiency or 2 bedroom Margin of Error Ratio is greater than .5 or if there is not sufficient data to calculate the ratio, then the bedroom ratio is determined using data for the smallest geographic area encompassing Sioux Falls, SD MSA for which there is acceptable data.
ACS Release | Adjusted Standard Quality Efficiency Estimate of Gross Rent | Adjusted Standard Quality Efficiency Margin of Error of Gross Rent | Efficiency Margin of Error Ratio | Adjusted Standard Quality 2 Bedroom Estimate of Gross Rent | Adjusted Standard Quality 2 Bedroom Margin of Error of Gross Rent | 2 Bedroom Margin of Error Ratio |
---|---|---|---|---|---|---|
2014 | $476 | $29 | $29 / $476 = 0.06 |
$686 | $8 | $8 / $686 = 0.01 |
2013 | $445 | $34 | $34 / $445 = 0.08 |
$679 | $8 | $8 / $679 = 0.01 |
2012 | $444 | $63 | $63 / $444 = 0.14 |
$672 | $9 | $9 / $672 = 0.01 |
Because 3 out of 3 local level ratios are reliable, their average will be used as the Efficiency ratio for FY 2017.
ACS_{2012} Ratio | ACS_{2013} Ratio | ACS_{2014} Ratio | Average of Reliable Ratios (Preliminary Efficiency Bedroom Ratio) |
---|---|---|---|
$444/ $672 = 0.661 |
$445/ $679 = 0.655 |
$476/ $686 = 0.694 |
0.670 |
The preliminary Efficiency bedroom ratio is checked against the caps and floors for that bedroom size. The floor is set at the 10th percentile of the national distribution of Efficiency bedroom ratios (weighted by population), while the cap is set at the 90th percentile of the same distribution.
Sioux Falls, SD MSA Preliminary Efficiency Bedroom Ratio | National Efficiency Floor | National Efficiency Ceiling | Sioux Falls, SD MSA Preliminary Efficiency Bedroom Ratio |
---|---|---|---|
0.670 | 0.634 | 0.826 | 0.670 is between floor and ceiling ratios. |
In order to ensure that Efficiency Fair Market Rents are not greater than the corresponding 1 Bedroom Fair Market Rent, the Efficiency Rent Ratio must be at least 0.005 less than the corresponding 1 Bedroom Rent Ratio.
Sioux Falls, SD MSA Preliminary Efficiency Bedroom Ratio | Sioux Falls, SD MSA 1 Bedroom Ratio | Comparison |
---|---|---|
0.670 | 0.807 | 0.670 ≤ (0.807 - 0.005) 0.670 ≤ 0.802 Use 0.670 |
Multiply the Efficiency Rent Ratio by the 2-Bedroom Fair Market Rent to determine the Efficiency Fair Market Rent for Sioux Falls, SD MSA.
Computation of Efficiency FMR for Sioux Falls, SD MSA | ||
---|---|---|
Efficiency Rent Ratio | FY 2017 2-Bedroom FMR | FY 2017 Efficiency FMR |
0.670 | $811 | $811 * 0.670 = $543 |
Prepared by the Economic and Market Analysis Division, HUD. Technical Problems or questions? Contact Us.