Section 8 Fair Market Rent (FMR) for ZIP 78223 - 2027

Investment Score for ZIP 78223

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	$950
1 Bedroom	$1,040
2 Bedrooms	$1,250
3 Bedrooms	$1,620
4 Bedrooms	$1,880
5 Bedrooms	$2,181
6 Bedrooms	$2,443
7 Bedrooms	$2,638
8 Bedrooms	$2,770

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	$1,250	$129,149	0.97%	C
3BR	$1,620	$181,983	0.89%	C
4BR	$1,880	$227,656	0.83%	C
5BR	$2,181	$292,989	0.74%	D

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 78223 (San Antonio, TX) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 78223 in San Antonio, Texas, is set by HUD for 2026. The FMRs for different bedroom sizes are as follows: - 0BR: $940 - 1BR: $1030 - 2BR: $1250 - 3BR: $1600 - 4BR: $1870 Comparing these FMRs to actual rental prices, we see that the FMR for a 2BR unit is $1250, which is slightly higher than the Zillow median price for a 2BR unit of $124,847. However, the price-to-FMR ratio is 8.3x, indicating that the purchase price of properties is significantly higher than what renters can afford through vouchers. This suggests that landlords who rely solely on Section 8 vouchers might face challenges in covering mortgage payments, property taxes, and maintenance costs if they purchase at the median price. #### Affordability & Renter Profile ZIP code 78223 has a population of 58,983, with 42.4% of residents being renters. The median household income is $52,088, and the occupancy rate is 90.2%, suggesting a relatively tight rental market. The affordability of housing is a critical issue, especially for those relying on Section 8 vouchers. A 2BR unit priced at $1250 represents 28.8% of the median income, which is within the affordability range for many residents but still a significant portion of their monthly budget. Given the high percentage of renters and the occupancy rate, it appears that the demand for rental units is strong. However, the high price-to-FMR ratio indicates that the cost of purchasing property is not aligned with the rental income potential, making it challenging for low-income households to find affordable housing. #### Investor Angle From an investor perspective, the ZIP code 78223 presents mixed opportunities. The FMR for a 2BR unit is $1250, which is the rent amount that voucher holders can pay. However, the median purchase price of a 2BR unit is $124,847, leading to a price-to-FMR ratio of 8.3x. This means that the purchase price is much higher than the rent that can be collected, which could result in negative cash flow for investors who buy at the median price. To determine if this ZIP code is cash-flow positive at FMR, we need to consider the typical expenses associated with owning a rental property. These include mortgage payments, property taxes, insurance, maintenance, and other operational costs. Assuming a 30-year fixed-rate mortgage at 5% interest, the monthly payment for a $124,847 property would be approximately $650. Property taxes in Bexar County average around 1.5% of the home value, which would be about $187 per month. Insurance and maintenance costs can vary widely but typically add another $100-$150 per month. Adding up these expenses, the total monthly cost for an investor would be around $937-$987, which is just below the FMR for a 2BR unit ($1250). While this might make the property cash-flow positive, the margin is slim, and any unexpected expenses could quickly erode profitability. In terms of investment grade, the high price-to-FMR ratio and the tight margins suggest that this ZIP code is not a particularly attractive investment for those focusing exclusively on Section 8 vouchers. Investors looking for stable returns and positive cash flow might want to consider other areas with lower purchase prices relative to FMRs. #### Specific Actionable Insights 1. **Focus on Lower-Priced Properties:** Investors should target properties below the median price of $124,847 to ensure positive cash flow. For example, a 2BR unit purchased for $100,000 would have a mortgage payment of about $530, reducing the overall monthly expense to around $817. This leaves a comfortable buffer above the FMR of $1250, ensuring profitability. 2. **Consider Smaller Units:** Given the high price-to-FMR ratio, smaller units like 0BR or 1BR might offer better investment opportunities. The FMR for a 0BR unit is $940, and for a 1BR unit, it is $1030. If investors can find properties in these categories at a lower purchase price, they can achieve positive cash flow more easily. 3. **Evaluate Rental Demand:** With a 90.2% occupancy rate, there is a strong demand for rental units. Investors should conduct thorough market research to identify areas within ZIP 78223 where rental demand is highest and competition is lower. This could involve analyzing submarkets, proximity to employment centers, and amenities. #### Bottom Line For Section 8-focused investors, ZIP code 78223 presents a challenging environment due to the high price-to-FMR ratio and the tight margins between rental income and property expenses. The recommendation for this ZIP code is to **Skip** unless investors can find properties significantly below the median price or focus on smaller units where the FMR is closer to the purchase price. The current market conditions do not favor positive cash flow investments based on the provided data.

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.