Location: Cape May County, NJ | Metro: Cape May County, 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 | $1,780 |
| 1 Bedroom | $1,790 |
| 2 Bedrooms | $2,190 |
| 3 Bedrooms | $2,870 |
| 4 Bedrooms | $2,880 |
| 5 Bedrooms | $3,341 |
| 6 Bedrooms | $3,742 |
| 7 Bedrooms | $4,041 |
| 8 Bedrooms | $4,243 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,190 | $976,894 | 0.22% | F |
| 3BR | $2,870 | $1,562,872 | 0.18% | F |
| 4BR | $2,880 | $2,615,075 | 0.11% | F |
| 5BR | $3,341 | $4,326,919 | 0.08% | F |
U.S. Census Bureau data (2024)
The analysis of ZIP code 08202, Avalon, NJ, reveals a unique balance between yield and stability that does not perfectly fit into either a high-yield/low-stability flip-style market or a steady-cashflow zone. Instead, it falls into a category that can be described as a moderate-yield/moderate-stability market.
On the yield axis, the Fair Market Rent (FMR) for 2024 is set at $1,650, which is slightly below the market rent of $1,708. However, the median home value of $2,682,868 indicates a relatively high-value property area, suggesting that rental yields could be competitive if the properties are priced appropriately. The gap between the FMR and market rent suggests potential for higher rental income if landlords can command the market rate, but the significant disparity between the rental rates and the high home values implies that the primary market is not for short-term flips but rather for long-term investments or vacation rentals.
Moving to the stability axis, the data paints a picture of a moderately stable market. With only 6.6% of the population being renters, the demand for rental properties is limited. This low percentage of renters could indicate a less stable rental market, as it suggests a smaller pool of potential tenants. Additionally, the lack of data on days on market (DOM) further underscores the uncertainty in the rental turnover rate. However, the average household income of $146,071 provides a strong economic foundation, which supports the ability of residents to pay higher rents and potentially leads to lower vacancy rates and more reliable cash flow.
To summarize, ZIP 08202 offers a moderate rental yield when considering both the FMR and market rent figures relative to the high median home value. Its stability is also moderate, influenced by the low percentage of renters and the high average household income. Landlords and small-portfolio investors should consider the niche nature of this market, likely catering to vacation or seasonal rentals, and plan accordingly with pricing strategies that reflect the local demand and economic conditions.
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.