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 | $1,260 |
| 1 Bedroom | $1,350 |
| 2 Bedrooms | $1,570 |
| 3 Bedrooms | $2,070 |
| 4 Bedrooms | $2,300 |
| 5 Bedrooms | $2,668 |
| 6 Bedrooms | $2,988 |
| 7 Bedrooms | $3,227 |
| 8 Bedrooms | $3,388 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,570 | $333,063 | 0.47% | F |
| 3BR | $2,070 | $336,243 | 0.62% | D |
| 4BR | $2,300 | $369,324 | 0.62% | D |
U.S. Census Bureau data (2024)
ZIP code 85378 in Surprise, AZ, encompasses a residential area with a population of 9,765 residents. Approximately 38.0% of these residents are renters, indicating a significant demand for rental properties in the neighborhood. The median household income here is $56,444, which suggests a middle-class community where many households might rely on financial assistance programs such as Section 8 to afford housing. The median home value stands at $335,675, reflecting a moderate cost of living compared to other areas in Surprise.
The Fair Market Rent (FMR) for ZIP 85378 for the fiscal year 2024 is set at $1,880. This is notably higher than the current market rent, which is estimated at $1,710 based on ZORI (Zillow Observed Rent Index) data. This discrepancy between the FMR and the market rent presents an opportunity for landlords who can leverage the higher reimbursement rates from the government to cover their expenses and potentially earn a profit above typical market rents.
Given the economic profile of the neighborhood, ZIP 85378 would be suitable for both hands-off voucher operators and hands-on value-add buyers. For hands-off operators, the higher FMR compared to the market rent means they can receive additional subsidies without actively managing the property beyond routine maintenance. On the other hand, for value-add buyers looking to improve and increase the value of their properties, the potential to raise rents closer to the FMR while still being attractive to Section 8 tenants makes it a viable option. However, it's important to note that the success of either strategy will depend on the condition of the properties and the ability to attract and retain tenants.
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.