Section 8 Fair Market Rent (FMR) for ZIP 85140 - 2027

Investment Score for ZIP 85140

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	$1,680
1 Bedroom	$1,810
2 Bedrooms	$2,100
3 Bedrooms	$2,770
4 Bedrooms	$3,070
5 Bedrooms	$3,561
6 Bedrooms	$3,988
7 Bedrooms	$4,307
8 Bedrooms	$4,522

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	$2,100	$516,780	0.41%	F
3BR	$2,770	$384,209	0.72%	D
4BR	$3,070	$430,954	0.71%	D
5BR	$3,561	$508,224	0.7%	D

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 85140 (San Tan Valley, AZ) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for San Tan Valley, AZ, as of 2026, is set at $2250 for a two-bedroom unit. This amount represents 26.6% of the median household income of $101,477. However, the actual rental market in San Tan Valley is significantly higher. According to Zillow, the median price for a two-bedroom home is $516,655, which translates into a price-to-FMR ratio of 19.1x. This means that the actual rent for a two-bedroom property could be around $43,000 annually if it were rented out at the same rate as the median home price. Given these figures, there is a significant gap between the FMR and the actual rents. For instance, a two-bedroom unit priced at $2250 per month would be considered affordable under the FMR guidelines, but it is likely that many landlords would charge much higher rates due to the high demand and limited supply. Therefore, voucher holders face strict constraints, as they can only pay up to the FMR, which is far below the actual market rates. #### Affordability & Renter Profile San Tan Valley has a population of 51,260, with 14.2% of residents being renters. The occupancy rate is quite high at 93.7%, indicating a tight rental market. Given the median household income of $101,477, the area is relatively affluent, which suggests that the typical renter might be a family or individual who is financially stable but still seeking affordable housing options. Despite the high median income, the fact that 14.2% of the population are renters indicates a segment of the community that may struggle with housing affordability. With the FMR for a two-bedroom unit being $2250, which is 26.6% of the median income, it is clear that even though the FMR is designed to be affordable, the actual rental prices are likely to exceed this threshold. This makes it challenging for voucher holders to find suitable accommodation, especially since the actual rents are much higher than the FMR. #### Investor Angle From an investor's perspective, the ZIP code 85140 presents a mixed picture. While the rental market is strong, with a high occupancy rate and limited supply, the actual rents are significantly higher than the FMR. For a two-bedroom unit, the FMR is $2250, but the actual median rent could be closer to $43,000 annually based on the price-to-FMR ratio. However, for investors focusing on Section 8 vouchers, the FMR is the key metric. To determine if this ZIP code is cash-flow positive at FMR, we need to consider the cost of acquisition and maintenance. If an investor buys a two-bedroom property at the median price of $516,655, the annual rent at FMR would be $27,000 ($2250 x 12). This would likely not cover the mortgage payments, property taxes, insurance, and maintenance costs, making it a negative cash flow investment at FMR. The investment grade for this ZIP code would be low for Section 8-focused investors due to the high acquisition costs and the limited ability to increase rents beyond the FMR. However, for those who can afford to hold properties long-term and benefit from appreciation, it could be a viable investment. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should focus on smaller units such as one-bedroom or studio apartments. The FMR for a one-bedroom unit is $1940, which is lower than the two-bedroom FMR. This could provide better cash flow opportunities, although the demand for larger units is also high. 2. **Consider Non-Section 8 Rentals**: Investors should consider renting to non-voucher holders, who are willing to pay higher market rates. The actual median rent for a two-bedroom unit could be around $43,000 annually, which would provide a much better return on investment compared to renting at FMR. 3. **Evaluate Long-Term Appreciation**: While the short-term cash flow may be negative, the long-term appreciation potential of properties in San Tan Valley could make it a worthwhile investment. The high median home price suggests that the area is desirable and likely to see continued growth in value over time. #### Bottom Line For Section 8-focused investors, the ZIP code 85140 (San Tan Valley, AZ) is a **Skip** recommendation. The high acquisition costs and the limited ability to increase rents beyond the FMR make it difficult to achieve positive cash flow. However, for investors who are willing to hold properties long-term and benefit from potential appreciation, it could be a **Hold** recommendation. Overall, the tight rental market and high median income suggest that the area is attractive, but the dynamics of Section 8 vouchers do not align well with the current market conditions.

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.