Location: Middlesex-Somerset-Hunterdon, NJ | Metro: Middlesex-Somerset-Hunterdon, 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 | $2,320 |
| 1 Bedroom | $2,490 |
| 2 Bedrooms | $3,110 |
| 3 Bedrooms | $3,710 |
| 4 Bedrooms | $4,160 |
| 5 Bedrooms | $4,826 |
| 6 Bedrooms | $5,405 |
| 7 Bedrooms | $5,837 |
| 8 Bedrooms | $6,129 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $2,490 | $311,711 | 0.8% | D |
| 2BR | $3,110 | $488,041 | 0.64% | D |
| 3BR | $3,710 | $726,303 | 0.51% | F |
| 4BR | $4,160 | $1,109,906 | 0.37% | F |
U.S. Census Bureau data (2024)
The Section 8 thesis for ZIP code 07921, which encompasses Bedminster, NJ, revolves around the discrepancy between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR stands at $2960, while the Zillow Observed Rent Index (ZORI) indicates that the market rent is $2862. This means that the FMR is $98 higher than the market rent, representing an increase of approximately 3.4%. This positive gap suggests that landlords and small-portfolio investors can benefit from renting to voucher tenants.
In Bedminster, where 21.0% of residents are renters and the median home value is $511,053, the median income is $123,104. Despite these relatively high figures, the FMR being above the market rent implies that voucher tenants can provide a stable source of income. The government's guarantee to cover the difference between the market rate and the FMR ensures that landlords receive a fixed payment that exceeds the average market rent. This makes it a favorable yield play, especially in a market where rental vacancy rates might be low due to the high median home value and income levels.
The cost of housing voucher tenants below open-market rates is minimal when compared to the benefits. Since the FMR is set higher than the current market rent, landlords can expect to receive slightly more than what they would typically earn from non-voucher tenants. Additionally, the stability provided by the government-backed vouchers reduces the risk associated with tenant turnover and unpaid rent.
To summarize, the gap between the FMR and the market rent in Bedminster, NJ, makes it a compelling investment opportunity for those willing to accept housing vouchers. The higher FMR ensures a steady income stream that aligns well with the local economic conditions and rental market dynamics.
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.