Section 8 Fair Market Rent (FMR) for ZIP 78227 - 2027

Investment Score for ZIP 78227

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: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,250	$130,538	0.96%	C
3BR	$1,620	$158,969	1.02%	B
4BR	$1,880	$194,293	0.97%	C
5BR	$2,181	$225,433	0.97%	C

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 78227 (San Antonio, TX) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 78227 in San Antonio, TX, for a two-bedroom apartment is set at $1220 per month for the year 2026. This amount represents 28.4% of the median household income in the area, which stands at $51,519. However, the actual rental prices in the market are significantly higher. According to Zillow, the median price for a two-bedroom rental property is $131,102, which translates to a monthly rent of approximately $1092.50 based on a typical mortgage payment schedule. The price-to-FMR ratio is 9.0x, indicating that the actual market prices are nearly nine times the FMR for a two-bedroom unit. This substantial gap between FMR and actual rents poses significant constraints for voucher holders. They may struggle to find suitable housing within the limits of their vouchers, particularly for larger units such as three or four bedrooms, where the FMRs are $1570 and $1820, respectively. These amounts are likely to be far below what landlords are charging in the current market, making it challenging for voucher recipients to secure housing that meets their needs. #### Affordability & Renter Profile ZIP code 78227 has a population of 44,035, with 41.0% of residents being renters. This indicates a significant demand for rental properties in the area. The occupancy rate is 89.2%, suggesting that the market is relatively tight, with most available units being occupied. Given the high percentage of renters and the limited supply of available units, competition for affordable housing is likely intense. The median household income of $51,519 suggests that many residents are in lower-middle-income brackets. With 28.4% of median income allocated to FMR for a two-bedroom unit, it becomes clear that affordability is a key issue for many residents. The disparity between the FMR and the actual market prices means that renters without subsidies would have to spend a disproportionately large portion of their income on housing, potentially leading to financial stress. #### Investor Angle From an investor perspective, the ZIP code 78227 presents both opportunities and challenges. The FMRs provide a baseline for what the government considers affordable, but the actual market prices are much higher. For a two-bedroom unit, the FMR is $1220, while the median market price is around $1092.50. This means that if an investor were to purchase a two-bedroom property at the median price and rent it out at the FMR, they would be operating at a loss unless they can leverage other cost-saving measures or subsidies. However, the high price-to-FMR ratio also indicates that there is potential for higher returns if investors can secure tenants willing to pay market rates. The challenge lies in balancing the need to attract tenants who can afford market rates with the availability of Section 8 vouchers. Given the tight market conditions and the high demand for rental properties, investors might find success by targeting the broader rental market rather than solely relying on Section 8 vouchers. #### Specific Actionable Insights 1. **Target Larger Units for Section 8 Tenants**: While the FMR for a two-bedroom unit is $1220, the actual market price is $1092.50, indicating a potential mismatch. Investors should consider focusing on larger units like three or four bedrooms, where the FMRs are $1570 and $1820, respectively. These higher FMRs are closer to the actual market prices, making it more feasible to find tenants with Section 8 vouchers who can cover the rent. 2. **Diversify Tenant Base**: Given the high price-to-FMR ratio, it is advisable for investors to diversify their tenant base. While Section 8 vouchers can provide a steady stream of income, the limited number of units that qualify under the FMR may restrict growth. By attracting tenants who can pay market rates, investors can mitigate the risk of relying too heavily on subsidized housing. 3. **Consider Renovation Projects**: The median market price for a two-bedroom unit is $131,102, which is significantly higher than the FMR. Investors could consider purchasing older properties at lower prices and renovating them to command higher rents. This strategy could help bridge the gap between FMR and market rates, making the investment more profitable. #### Bottom Line For Section 8-focused investors, ZIP code 78227 presents a mixed landscape. While there is a strong demand for rental properties, the high price-to-FMR ratio makes it difficult to operate profitably within the strictures of the voucher program alone. Therefore, the recommendation for investors is to **Hold** on to existing properties and **Skip** new acquisitions focused solely on Section 8 tenants. Instead, investors should consider diversifying their tenant mix and exploring renovation projects to increase the profitability of their investments.

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.