Location: Phoenix-Mesa-Chandler, AZ | Metro: Phoenix-Mesa-Chandler, AZ MSA
Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,320 |
| 1 Bedroom | $1,420 |
| 2 Bedrooms | $1,650 |
| 3 Bedrooms | $2,180 |
| 4 Bedrooms | $2,410 |
| 5 Bedrooms | $2,796 |
| 6 Bedrooms | $3,132 |
| 7 Bedrooms | $3,383 |
| 8 Bedrooms | $3,552 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,650 | $262,206 | 0.63% | D |
| 3BR | $2,180 | $362,912 | 0.6% | D |
| 4BR | $2,410 | $410,506 | 0.59% | F |
| 5BR | $2,796 | $493,575 | 0.57% | F |
U.S. Census Bureau data (2024)
Peoria’s 85345 ZIP code covers the city’s historic Old Town and surrounding residential districts, blending a small-town feel with Phoenix’s suburban expansion. The area is characterized by established neighborhoods, local parks, and a growing focus on revitalization. A significant economic driver nearby is the Peoria Sports Complex, the spring training home of the San Diego Padres and Seattle Mariners, which boosts local commerce and provides steady employment. The neighborhood generally offers a mix of mid-century single-family homes and newer apartment complexes, appealing to families seeking affordability relative to newer West Valley developments.
From a financial perspective, the math for Section 8 investors in this ZIP is tight. The FY2026 Fair Market Rent for a 2-bedroom unit is set at $1,790, while current market rents (Zillow ZORI) sit at $1,796. This results in a negligible gap of just $6, meaning voucher payments closely match market rates rather than exceeding them. The median home value is $365,573, and with a median 2BR sale price of $267,262, acquisition costs are moderate. Properties here move at a measured pace, with a median of 53 days on market. Based on the rent-to-value ratio, voucher tenants essentially cash-flow at market parity, offering no significant premium.
Demand fundamentals remain supportive despite the narrow rent spreads. With a renter share of 33.5% and a median household income of $67,380, there is a clear demographic need for affordable housing options. Local educational options, such as Peoria High School, and proximity to major arterials like Grand Avenue enhance the area’s rental desirability for working-class families. While the income data suggests tenants can support standard rents, the high renter concentration indicates a consistent pool of applicants looking for stable housing, which helps minimize vacancy risk over time.
The strongest investor angle here is stability and volume. Because the Section 8 FMR aligns almost perfectly with market rent, investors should not expect a premium subsidy but rather a government-backed guarantee on a standard market rate. Given the $365,573 median home value and moderate inventory turnover, the strategy is to secure reliable occupancy in an established neighborhood rather than chasing maximum yield. This area is best suited for investors prioritizing lower vacancy risk over aggressive cash-flow jumps.
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.