Location: Newark, NJ | Metro: Newark, 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 | $2,460 |
| 1 Bedroom | $2,780 |
| 2 Bedrooms | $3,350 |
| 3 Bedrooms | $4,180 |
| 4 Bedrooms | $4,780 |
| 5 Bedrooms | $5,545 |
| 6 Bedrooms | $6,210 |
| 7 Bedrooms | $6,707 |
| 8 Bedrooms | $7,042 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $4,180 | $1,605,045 | 0.26% | F |
| 4BR | $4,780 | $2,073,531 | 0.23% | F |
| 5BR | $5,545 | $3,023,942 | 0.18% | F |
U.S. Census Bureau data (2024)
The analysis for the Section 8 program in ZIP code 07078 reveals a significant disparity between the Fair Market Rent (FMR) and the actual market rent, which has direct implications for landlords and small-portfolio investors. The FMR for ZIP 07078 in fiscal year 2024 is set at $2870, whereas the market rent, measured by Zillow's ZORI index, stands at $5,215. This represents a gap of $2,345 per month, or approximately 45% of the market rent.
The gap underscores that landlords who accept Section 8 vouchers in this area are effectively renting their properties below the open-market rate. This scenario can lead to financial challenges, particularly when considering the broader economic context of the region. With only 11.5% of residents being renters, competition for rental properties is relatively low, but the median home value of $2,305,991 and median income of $250,001 suggest a high cost of living and potentially higher property maintenance costs.
Investors must weigh the benefits of steady, government-backed rental income against the potential drawbacks of lower-than-market rates. Accepting Section 8 tenants means landlords receive a fixed amount each month, which might be less volatile than market rents but also significantly lower. For instance, if a landlord could rent out a property for $5,215 on the open market, accepting a Section 8 tenant would mean a monthly loss of $2,345. Over the course of a year, this translates into a substantial difference of $28,140.
In conclusion, while the Section 8 program provides a stable source of income, it is crucial for landlords and investors to consider the economic realities of ZIP 07078. The significant gap between FMR and market rent highlights the financial trade-offs involved in housing voucher tenants. These factors should be carefully considered before deciding to participate in the program.
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.