Section 8 Fair Market Rent (FMR) for ZIP 78108 - 2027

Investment Score for ZIP 78108

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	$1,650
1 Bedroom	$1,790
2 Bedrooms	$2,160
3 Bedrooms	$2,790
4 Bedrooms	$3,240
5 Bedrooms	$3,758
6 Bedrooms	$4,209
7 Bedrooms	$4,546
8 Bedrooms	$4,773

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$2,160	$202,149	1.07%	B
3BR	$2,790	$279,587	1%	C
4BR	$3,240	$346,847	0.93%	C
5BR	$3,758	$393,161	0.96%	C

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 78108 (Cibolo, TX) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 78108 is set by HUD for 2026. For a two-bedroom unit, the FMR is $2,140. However, the actual rental prices in Cibolo are significantly higher, as evidenced by the Zillow median price for a two-bedroom home, which stands at $205,985. This translates into a price-to-FMR ratio of approximately 8.0x, indicating that the actual rent for a two-bedroom property could be around $17,120 annually based on the median price. Given that the FMR is only $2,140, this represents a substantial gap between what voucher holders can afford and the actual rental prices. The FMR is designed to cover approximately 40% of the median income, which in Cibolo is $113,040. Therefore, the FMR for a two-bedroom unit is 22.7% of the median household income, suggesting that it is already a relatively affordable amount compared to local incomes. However, the actual rental prices far exceed this amount, making it challenging for Section 8 voucher holders to find suitable housing within their budget. #### Affordability & Renter Profile The population of Cibolo is 49,784, with a renter percentage of 16.1%. This indicates that a relatively small portion of the population relies on rental properties, suggesting a tighter market where demand is likely outpacing supply. The occupancy rate of 95.6% further supports this notion, as it implies that most available units are already occupied, leaving little room for new renters. The median household income of $113,004 suggests that the majority of residents have high earning potential, which could contribute to the higher rental prices. However, the 16.1% renter population is a smaller segment that might struggle with affordability, especially those who rely on Section 8 vouchers. Given the significant difference between the FMR and actual rental prices, it is clear that the market is not particularly friendly towards low-income renters, who would need to find units priced below the Zillow median to make ends meet. #### Investor Angle From an investor perspective, the ZIP code 78108 presents a mixed picture. The FMR for a two-bedroom unit is $2,140, but the actual rental prices are much higher, potentially around $17,120 annually based on the median home price. This means that if an investor were to purchase a property at the median price and rent it out, they would be far above the FMR threshold. To determine if the ZIP code is cash-flow positive at FMR, we must consider the typical rental income versus the mortgage payments. Assuming a mortgage rate of 4.5% and a 20% down payment, the annual mortgage payment for a $205,985 property would be approximately $11,750. This leaves a significant gap between the mortgage payment and the potential rental income at FMR levels. Therefore, relying solely on FMR rates would likely result in negative cash flow for investors. However, given the high actual rental prices, investors could achieve positive cash flow by renting at market rates rather than FMR. This would mean that the investment grade for properties in Cibolo is favorable for those willing to cater to higher-income tenants or those without the constraint of Section 8 vouchers. #### Specific Actionable Insights 1. **Focus on Higher-Income Tenants**: Given the high median household income and the significant disparity between FMR and actual rental prices, investors should focus on attracting higher-income tenants. This strategy would ensure positive cash flow and align with the local market dynamics. 2. **Consider Alternative Rental Programs**: Investors looking to cater to lower-income renters could explore alternative rental assistance programs that offer higher subsidy limits than Section 8. This could help bridge the gap between FMR and actual rental prices, making properties more accessible to a broader range of tenants. 3. **Evaluate Property Value Relative to FMR**: Before purchasing any property, investors should carefully evaluate the potential rental income relative to the FMR. For instance, a two-bedroom unit priced at $205,985 would generate a rental income of about $17,120 annually, which is well above the FMR of $2,140. This highlights the importance of understanding the local rental market and ensuring that the investment aligns with realistic rental expectations. #### Bottom Line For Section 8-focused investors, the recommendation is to **skip** this ZIP code due to the significant gap between FMR and actual rental prices. The market is not conducive to low-income renters, and relying on FMR rates would likely result in negative cash flow. Instead, investors should look for areas with lower median home prices and closer alignment between FMR and actual rental rates to ensure a viable investment opportunity.

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.