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 | $2,410 |
| 1 Bedroom | $2,720 |
| 2 Bedrooms | $3,280 |
| 3 Bedrooms | $4,090 |
| 4 Bedrooms | $4,680 |
| 5 Bedrooms | $5,429 |
| 6 Bedrooms | $6,080 |
| 7 Bedrooms | $6,566 |
| 8 Bedrooms | $6,894 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $2,720 | $361,198 | 0.75% | D |
| 2BR | $3,280 | $456,370 | 0.72% | D |
| 3BR | $4,090 | $609,285 | 0.67% | D |
U.S. Census Bureau data (2024)
The economics of Section 8 in ZIP code 07457, Riverdale, New Jersey, involve understanding the relationship between the SAFMR (Small Area Fair Market Rent) and the local market rent. For a two-bedroom apartment in this specific ZIP code, the SAFMR for fiscal year 2024 is set at $2,870. This figure represents the maximum amount that the housing authority will pay on behalf of eligible tenants under the Section 8 program.
In contrast, the local market rent, measured by ZORI (Zillow Observed Rent Index), stands at $3,076. This indicates the average rent price for similar units in the same area. Landlords should be aware that the SAFMR does not automatically adjust to match the ZORI; it is a fixed maximum subsidy rate.
A landlord's actual reimbursement from a Section 8 voucher includes both the tenant's portion of the rent and any utility allowances. Typically, the tenant contributes 30% of their adjusted income towards rent. If we assume an average adjusted income that would result in a contribution of around $862 (which is 30% of $2,870), then the total rent collected by the landlord would be the sum of the tenant’s payment and the housing authority’s subsidy.
The utility allowance varies but is generally around $200-$300 per month. Adding a conservative estimate of $250 for utilities, the total monthly income a landlord can expect from a Section 8 voucher for a two-bedroom unit would be approximately $1,112 ($862 + $250).
To determine the reimbursement gap or surplus, compare the total expected income from the voucher against the ZORI. In this case, the ZORI is $3,076, so the gap between the local market rent and the total income from the voucher is $1,964 per month. This means that landlords accepting Section 8 vouchers in ZIP 07457 would see a significant shortfall compared to the typical market rent.
While Section 8 provides a stable source of rental income, it is important for landlords to recognize the economic realities. Accepting a Section 8 voucher for a two-bedroom unit in ZIP 07457 would mean receiving a reimbursement of roughly $1,112 per month, falling short of the local market rent by $1,964. This gap highlights the financial considerations landlords must make when deciding whether 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.