Section 8 Fair Market Rent (FMR) for ZIP 07091 - 2027

FY 2027 Fair Market Rent Rates

The economics of Section 8 in ZIP code 07091, located in Newark County, New Jersey, are defined by the SAFMR (Small Area Fair Market Rent) rates set specifically for this ZIP code. For a two-bedroom apartment, the SAFMR for FY 2024 is $1920. This figure represents the maximum amount that HUD (Department of Housing and Urban Development) will reimburse landlords for renting out a unit under the Section 8 program.

To understand how this works for landlords, it's important to know the components of the voucher payment. The tenant is responsible for paying approximately 30% of their adjusted income towards rent. For example, if a tenant has an adjusted monthly income of $1600, they would pay $480 toward rent. The remaining balance, up to the SAFMR, is covered by the Section 8 voucher.

In addition to the base rent, there are utility allowances that can vary based on the type of utilities required in the property. These allowances are added to the total reimbursement amount but do not exceed the SAFMR. If the tenant’s share plus the utility allowance equals or exceeds the SAFMR, then the landlord receives the full $1920.

However, if the local market rent for a two-bedroom in ZIP 07091 were higher than the SAFMR, which is currently not available, landlords might face a reimbursement gap. This gap is the difference between what the market rent demands and what the Section 8 program will pay. Conversely, if the local market rent is lower than the SAFMR, landlords could receive more than the market value, creating a surplus.

Given the SAFMR of $1920 and assuming a market rent lower than this, landlords participating in Section 8 for a two-bedroom unit in ZIP 07091 would likely see a surplus. This surplus provides a buffer against potential shortfalls due to maintenance costs or vacancy periods. It also ensures that landlords are not financially disadvantaged compared to renting at market rates.

If the local market rent were exactly $1920, landlords would receive the full market rent without any surplus or gap. But since the local market rent is not specified here, we can only conclude that the SAFMR sets a cap on reimbursement, and landlords must consider whether this amount aligns with their financial goals and property management costs.

In summary, for a two-bedroom rental in ZIP 07091, landlords can expect a reimbursement of up to $1920 per month, with the possibility of a surplus if the local market rent is below this level. This arrangement provides a predictable income stream, albeit subject to the limitations imposed by the SAFMR.

Data Sources: FMR data from HUD (2027).

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.