Section 8 Fair Market Rent (FMR) for ZIP 02135 - 2027

Investment Score for ZIP 02135

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$2,680
1 Bedroom	$2,770
2 Bedrooms	$3,310
3 Bedrooms	$3,940
4 Bedrooms	$4,350
5 Bedrooms	$5,046
6 Bedrooms	$5,652
7 Bedrooms	$6,104
8 Bedrooms	$6,409

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$2,770	$415,669	0.67%	D
2BR	$3,310	$544,340	0.61%	D
3BR	$3,940	$800,299	0.49%	F
4BR	$4,350	$966,892	0.45%	F
5BR	$5,046	$1,145,323	0.44%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 02135 (Boston, MA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 02135 is set by HUD for 2026 as follows: - 0 Bedroom: $2610 - 1 Bedroom: $2740 - 2 Bedrooms: $3250 - 3 Bedrooms: $3900 - 4 Bedrooms: $4300 Comparing these figures to the actual rents in the area, we can see that the Zillow median price for a 2-bedroom unit is $555,457. This translates to a monthly rent of approximately $4629 based on typical mortgage payments and property management costs. The Price-to-FMR ratio for a 2BR unit is 14.2x, which means that actual rents are significantly higher than the FMR. This creates a significant constraint for voucher holders. For instance, a 2BR unit priced at $4629 would be well above the $3250 FMR limit, making it unaffordable for those relying solely on Section 8 vouchers. Additionally, the FMR for a 2BR unit represents only 42.9% of the median household income ($90,829), indicating that even without vouchers, many residents may struggle to afford housing. #### Affordability & Renter Profile ZIP code 02135 has a population of 43,149, with 76.7% of the households being renters. This high percentage of renters suggests a strong demand for rental properties. The occupancy rate stands at 94.5%, indicating a very tight market where most available units are occupied. Given the high renter percentage and occupancy rate, it is clear that there is limited supply relative to demand, contributing to the high actual rents compared to FMR. The median household income of $90,829 suggests that the majority of residents have relatively high incomes, but the 76.7% renter rate indicates that many may still find housing unaffordable. The high rent-to-income ratio for 2BR units further supports this conclusion. This tight market is likely to continue due to the high demand and limited supply, putting upward pressure on rental prices. #### Investor Angle From an investor perspective, the ZIP code 02135 presents a challenging scenario for cash flow when targeting Section 8-focused investments. Based on the FMRs, a 2BR unit should rent for $3250 per month, while the actual market rent is around $4629. This discrepancy means that investors relying on Section 8 vouchers would need to accept a lower rental income than the market rate, potentially leading to negative cash flow. To determine the investment grade, we must consider the potential for rental income versus the cost of acquisition and maintenance. With the Zillow median price for a 2BR unit at $555,457, the cap rate (net operating income divided by the property value) would be quite low if the investor were to rent out the unit at the FMR. Assuming a conservative estimate of 5% annual maintenance costs, the net operating income would be approximately $10,248 per year, resulting in a cap rate of about 1.8%. This is generally considered a low-risk, low-return investment. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high actual rents compared to FMR, smaller units like 0BR or 1BR might be more feasible for Section 8 voucher holders. These units are priced at $2610 and $2740 respectively, which are closer to the market rates for similar-sized units. Investors could consider acquiring or developing smaller units to cater to this demographic. 2. **Consider Subsidies Beyond Section 8**: Due to the tight market and high actual rents, investors might want to explore other subsidy programs that offer higher rent limits. For example, Low-Income Housing Tax Credits (LIHTC) or state-specific subsidies might provide better financial returns while still serving low-income tenants. 3. **Target Underserved Areas**: Within ZIP code 02135, there might be pockets or neighborhoods where the rent-to-income ratio is slightly lower or where the demand for smaller units is higher. Conducting a neighborhood-level analysis could help identify areas where Section 8 vouchers are more likely to cover the actual rents. #### Bottom Line For Section 8-focused investors, ZIP code 02135 presents a challenging environment due to the significant gap between FMR and actual market rents. The recommendation is to **Skip** this ZIP code for pure Section 8 investments unless you can target smaller units or areas with lower rent-to-income ratios. Alternatively, consider exploring other subsidy programs that offer higher rent limits to ensure positive cash flow. --- This analysis provides a detailed look into the rental market dynamics of ZIP code 02135, highlighting the challenges and opportunities for Section 8-focused real estate investments.

Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-08-31). 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.