Section 8 Fair Market Rent (FMR) for ZIP 07202 - 2027

Investment Score for ZIP 07202

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	$1,600
1 Bedroom	$1,810
2 Bedrooms	$2,180
3 Bedrooms	$2,720
4 Bedrooms	$3,110
5 Bedrooms	$3,608
6 Bedrooms	$4,041
7 Bedrooms	$4,364
8 Bedrooms	$4,582

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$2,180	$368,839	0.59%	F
3BR	$2,720	$517,409	0.53%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 07202 (Elizabeth, NJ) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 07202, as per the 2026 data, is set at $2,060 for a two-bedroom apartment. This represents 34.7% of the median household income of $71,250. However, the actual rent for a two-bedroom unit can be significantly higher. According to Zillow, the median price for a two-bedroom home in this area is $363,962, which translates into a monthly mortgage payment of approximately $1,750, assuming a 4.5% interest rate and a 20% down payment. When factoring in property taxes, insurance, and maintenance costs, the total monthly cost could easily exceed $2,060. The price-to-FMR ratio of 14.7x indicates that the actual market rents are substantially higher than the FMR. This creates a significant constraint for voucher holders who may find it challenging to secure housing within their budget. #### Affordability & Renter Profile ZIP code 07202 has a high renter population of 71.8%, indicating a strong demand for rental properties. With a near full occupancy rate of 97.0%, the market is tight, suggesting that there is little to no excess supply of rental units. Given the high percentage of renters and the limited availability of units, it is likely that many residents are already struggling with affordability issues. The median household income of $71,250 suggests that a significant portion of the population relies on Section 8 vouchers to afford housing. However, the high price-to-FMR ratio means that even with vouchers, tenants may face difficulties finding affordable housing options. #### Investor Angle From an investor perspective, the ZIP code 07202 presents a mixed picture. While the occupancy rate is very high, indicating strong demand, the actual rents are much higher than the FMR. For instance, the FMR for a two-bedroom apartment is $2,060, but the median market rent could be closer to $3,639 (based on Zillow’s median home price). This means that landlords who rely solely on FMR might struggle to cover their costs, especially when considering the additional expenses like property taxes, insurance, and maintenance. To determine if the ZIP code is cash-flow positive at FMR, we need to consider the total cost of ownership. Assuming a mortgage payment of $1,750, property taxes of around $2,000 annually (approximately $167 monthly), insurance of about $100 monthly, and maintenance costs of $100 monthly, the total monthly cost would be around $2,117. At the FMR of $2,060, the landlord would be operating at a loss of $57 per month. Therefore, relying solely on FMR would not be financially viable for most investors. In terms of investment grade, the high price-to-FMR ratio and the tight market suggest that while there is demand, the risk of vacancy is low. However, the financial viability is questionable unless investors can secure higher rents or have access to properties below the median market price. #### Specific Actionable Insights 1. **Target Lower-Rent Properties**: Investors should focus on acquiring properties that are priced below the median market value. For example, targeting a two-bedroom property priced at $250,000 instead of the median $363,962 would result in a lower monthly mortgage payment of around $1,250. Combined with other costs, this would bring the total monthly expense to around $1,617, making it possible to operate at a profit with FMR rents. 2. **Consider Smaller Units**: One-bedroom units have a lower FMR of $1,700 compared to the two-bedroom FMR of $2,060. Given the high renter population and tight market, smaller units might be easier to fill and could offer better cash flow opportunities. Additionally, the 1BR FMR represents only 23.8% of the median household income, making it more accessible for voucher holders. 3. **Utilize Rental Assistance Programs**: In addition to Section 8 vouchers, investors could explore other rental assistance programs that might help bridge the gap between FMR and actual market rents. These programs could provide additional subsidies or incentives to make the investment more financially viable. #### Bottom Line For Section 8-focused investors, the ZIP code 07202 presents a challenging environment due to the high price-to-FMR ratio and the tight market conditions. The recommendation is to **skip** this ZIP code for now unless investors can secure properties at significantly below the median market price or can leverage additional rental assistance programs. The current dynamics suggest that relying solely on FMR would not be financially sustainable, and the high renter population and occupancy rate indicate a competitive market where securing tenants at FMR rates might be difficult.

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.