Location: Jersey City, NJ | Metro: Jersey City, NJ HUD Metro FMR Area
Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)
| Unit Size | Monthly FMR |
|---|---|
| Studio | $2,200 |
| 1 Bedroom | $2,250 |
| 2 Bedrooms | $2,500 |
| 3 Bedrooms | $3,040 |
| 4 Bedrooms | $3,560 |
| 5 Bedrooms | $4,130 |
| 6 Bedrooms | $4,626 |
| 7 Bedrooms | $4,996 |
| 8 Bedrooms | $5,246 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $2,250 | $285,920 | 0.79% | D |
| 2BR | $2,500 | $455,425 | 0.55% | F |
| 3BR | $3,040 | $594,357 | 0.51% | F |
| 4BR | $3,560 | $667,873 | 0.53% | F |
U.S. Census Bureau data (2024)
Bayonne, ZIP code 07002, functions as a stable, peninsular urban suburb with a distinct blue-collar heritage and growing appeal to commuters. The neighborhood is characterized by a mix of classic prewar housing stock and new waterfront developments, offering residents an alternative to the higher density of Jersey City while maintaining close proximity to Manhattan. A key local institution is the Bayonne Medical Center, which serves as a major employer and provides a steady economic base for the area. The community retains a tight-knit feel, anchored by local businesses and accessible parks, making it a practical location for long-term residents.
From a purely numerical standpoint, investors must navigate a noticeable spread between government subsidies and current market realities. The HUD SAFMR for a 2-bedroom unit in FY2024 sits at $2,040, while the projected Full FMR for FY2026 rises to $2,430. However, Zillow’s market rent index (ZORI) reports a current 2BR rate of $2,389, creating a gap of $349 against the current SAFMR. Property values are substantial, with a median home value of $582,656 and a specific median 2BR sale price of $448,579. Homes are moving at a moderate pace, with a median days on market of 49 days.
The tenant pool is deep, driven by a renter share of 63.8% and a median household income of $83,887. This income level suggests that while the area is not low-income, the high cost of home ownership pushes many families toward renting, sustaining healthy demand. Families are often drawn to the area for its access to highly rated public schools within the Bayonne School District and reliable transit options, including the Hudson-Bergen Light Rail, which facilitates commutes to Manhattan and other employment hubs.
The Section 8 verdict here leans toward stability and appreciation rather than immediate aggressive cash flow on new acquisitions. Because the FY2026 2BR FMR of $2,430 slightly exceeds the current market rent of $2,389, investors can achieve market-rate returns with the added security of a government-backed tenant. This eliminates vacancy risk while allowing the investor to participate in the equity growth suggested by a median home value approaching $600,000.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.