Section 8 Fair Market Rent (FMR) for ZIP 08902 - 2027

Investment Score for ZIP 08902

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	$2,200
1 Bedroom	$2,370
2 Bedrooms	$2,950
3 Bedrooms	$3,510
4 Bedrooms	$3,950
5 Bedrooms	$4,582
6 Bedrooms	$5,132
7 Bedrooms	$5,543
8 Bedrooms	$5,820

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	$2,950	$414,340	0.71%	D
3BR	$3,510	$564,938	0.62%	D
4BR	$3,950	$724,511	0.55%	F
5BR	$4,582	$879,386	0.52%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 08902 (North Brunswick, NJ) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 08902, as set by HUD for 2026, is $2740 for a two-bedroom apartment. This amount represents 27.2% of the median household income in North Brunswick, which stands at $121,071. The FMRs for other bedroom sizes are as follows: - 0BR: $1990 - 1BR: $2180 - 3BR: $3290 - 4BR: $3630 These figures provide insight into the rental market dynamics for Section 8 voucher holders. The FMRs are designed to ensure that voucher holders can find affordable housing options. However, the actual rents in the area can be significantly higher, making it challenging for voucher holders to secure suitable housing. For instance, the Zillow median price for a two-bedroom home in this ZIP code is $408,804. This translates to a price-to-FMR ratio of 12.4x, indicating that the actual market rents are far above the FMR levels. This suggests that voucher holders may face difficulties finding landlords willing to accept their vouchers due to the discrepancy between FMR and market rents. Landlords might prefer higher-paying tenants who do not rely on government subsidies. #### Affordability & Renter Profile With a renter population percentage of 42.8%, North Brunswick has a significant number of residents who are renting their homes. The occupancy rate of 98.1% indicates a robust demand for rental properties, suggesting that the market is relatively tight. Given the high median household income of $121,071, many renters likely have stable employment and financial situations, making them attractive tenants for landlords. However, the affordability gap is stark. The FMR for a two-bedroom unit is $2740, but the Zillow median price implies that the average market rent could be much higher. This makes it difficult for lower-income families to afford housing without assistance. The high price-to-FMR ratio also means that the market is not particularly favorable for those relying solely on FMR rates to find housing. #### Investor Angle From an investor's perspective, the ZIP code 08902 presents a mixed picture. The FMRs are set to ensure affordability, but they are significantly below the market rents. For example, a two-bedroom unit with an FMR of $2740 would need to generate a substantial cash flow to cover expenses and provide a return on investment if sold at the Zillow median price of $408,804. To determine whether this ZIP code is cash-flow positive at FMR, we must consider the typical operating costs, including mortgage payments, property taxes, insurance, maintenance, and other expenses. Assuming a conservative estimate of 10% of the purchase price for annual expenses, the total cost for a two-bedroom unit would be approximately $40,880 per year ($408,804 * 10%). At an FMR of $2740 per month, the annual rental income would be $32,880. This would result in a negative cash flow of about $8,000 per year, making it challenging for investors to rely solely on FMR rents for profitability. Given these factors, the investment grade for this ZIP code would be considered low for Section 8-focused investors. The primary challenge is the mismatch between FMR and market rents, leading to potential financial losses unless the investor can secure higher-paying tenants or manage the property efficiently to reduce costs. #### Specific Actionable Insights 1. **Target Higher-Rent Properties**: Investors should focus on properties that can command rents above the FMR levels. For example, a three-bedroom unit with an FMR of $3290 could potentially be rented out at a higher rate given the strong demand and high median income. This strategy would help mitigate the risk of negative cash flow. 2. **Consider Property Management Services**: Given the tight market and the challenges associated with managing properties at FMR levels, investors might benefit from using professional property management services. These services can help maintain properties and manage tenant relations effectively, reducing the likelihood of vacancies and ensuring consistent rental income. 3. **Evaluate Long-Term Appreciation Potential**: While the current cash flow might be negative at FMR levels, investors should also consider the long-term appreciation potential of properties in North Brunswick. With a median household income of $121,071 and a strong demand for rentals, there is a possibility that property values will continue to rise, providing capital gains over time. #### Bottom Line For Section 8-focused investors, the recommendation for ZIP code 08902 is to **Skip**. The high price-to-FMR ratio and the tight rental market make it challenging to achieve positive cash flow when relying solely on FMR rents. Investors looking to enter this market should either target higher-rent properties or consider the long-term appreciation potential rather than focusing on immediate rental income.

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.