Section 8 Fair Market Rent (FMR) for ZIP 85051 - 2027

Investment Score for ZIP 85051

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	$1,080
1 Bedroom	$1,170
2 Bedrooms	$1,380
3 Bedrooms	$1,870
4 Bedrooms	$2,120
5 Bedrooms	$2,459
6 Bedrooms	$2,754
7 Bedrooms	$2,974
8 Bedrooms	$3,123

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	$1,380	$192,849	0.72%	D
3BR	$1,870	$347,967	0.54%	F
4BR	$2,120	$385,966	0.55%	F
5BR	$2,459	$419,545	0.59%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 85051 (Phoenix, AZ) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 85051 in Phoenix, Arizona, as of 2026 is set at $1530 for a two-bedroom unit. This figure represents 26.5% of the median household income of $69,189, indicating that it is a reasonable rent amount relative to the local economy. However, the actual rental market price for a two-bedroom unit is significantly higher, with the Zillow median price at $202,240. This translates to a price-to-FMR ratio of 11.0x, which means that the actual market rent is approximately $16,830 annually ($1530 x 11.0), far exceeding the FMR limit. This disparity creates significant constraints for voucher holders. For instance, a tenant with a Section 8 voucher can only afford a two-bedroom unit if the landlord accepts the $1530 monthly payment, which is well below the market rate. Consequently, landlords may be hesitant to accept vouchers due to the lower rent compared to what they could potentially charge in the open market. This dynamic often limits voucher holders to a smaller pool of available properties, typically those that are older, less desirable, or in need of renovation. #### Affordability & Renter Profile ZIP code 85051 has a substantial renter population, with 44.8% of households renting their homes. The occupancy rate stands at 93.7%, suggesting that the housing market is relatively tight, with few vacant units available. Given the high proportion of renters and the tight market conditions, affordability is a critical issue. With the median household income at $69,189, many residents may struggle to find affordable housing options, especially when considering the high market rent prices. The median household income of $69,189 indicates that the area is moderately affluent, but the high rent-to-income ratio suggests that renters may face financial strain. A two-bedroom unit at the FMR of $1530 would consume about 26.5% of the median income, leaving limited funds for other essential expenses such as food, healthcare, and transportation. In contrast, the actual market rent of $16,830 per year would consume over 35% of the median income, making it even more challenging for renters to maintain a comfortable standard of living. #### Investor Angle From an investor’s perspective, the ZIP code 85051 presents both opportunities and challenges. While the FMRs provide a guideline for what the government considers affordable, the actual market rent is much higher. This means that properties rented at FMR levels may not generate sufficient cash flow to cover mortgage payments, property taxes, insurance, and maintenance costs. To determine if the ZIP code is cash-flow positive at FMR, we must consider the typical mortgage payment on a property valued at $202,240. Assuming a 30-year fixed-rate mortgage with an interest rate of 5% and a 20% down payment, the monthly mortgage payment would be approximately $965. Adding property taxes (assuming 1% of the home value), insurance (approximately $100 per month), and maintenance costs (typically 1% of the home value), the total monthly cost would be around $1265. This is just slightly above the FMR of $1530 for a two-bedroom unit, indicating that cash flow might be marginal or negative without additional subsidies or rent increases. Given the high price-to-FMR ratio and the tight market conditions, the investment grade for this ZIP code is moderate to low. Investors should carefully evaluate the potential for long-term appreciation and the ability to attract tenants willing to pay market rates. Additionally, the risk of vacancy and the challenge of finding landlords willing to accept Section 8 vouchers must be considered. #### Specific Actionable Insights 1. **Focus on Renovation Opportunities**: Given the high price-to-FMR ratio, investors should look for properties that require renovation. By investing in upgrades, they can potentially command higher rents while still staying within the FMR guidelines. For example, a property that needs minor repairs could be renovated for $10,000-$20,000, increasing its rental value to closer to the FMR level without fully reaching the market rate. 2. **Consider Multi-Family Properties**: Single-family homes in this ZIP code may struggle to generate positive cash flow at FMR levels. Instead, investors might want to focus on multi-family properties where economies of scale can help reduce overall costs. A two-bedroom apartment in a multi-family complex might have lower operating costs per unit, making it more feasible to rent at FMR levels. 3. **Engage with Local Landlords**: Building relationships with local landlords who are already accepting Section 8 vouchers can provide valuable insights into the market dynamics and tenant preferences. This engagement can also help identify areas where there is a greater willingness to accept vouchers, potentially leading to better cash flow and reduced vacancy rates. #### Bottom Line For Section 8-focused investors, the ZIP code 85051 presents a challenging environment due to the high price-to-FMR ratio and tight market conditions. The recommendation is to **Skip** this ZIP code unless you can identify specific opportunities for renovation or multi-family properties that can generate positive cash flow at FMR levels. Given the high market rents and the limited number of properties that can be rented at FMR, the risks outweigh the benefits for most investors seeking stable returns through Section 8 vouchers.

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.