Section 8 Fair Market Rent (FMR) for ZIP 89502 - 2027

Investment Score for ZIP 89502

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	$1,170
1 Bedroom	$1,350
2 Bedrooms	$1,690
3 Bedrooms	$2,290
4 Bedrooms	$2,660
5 Bedrooms	$3,086
6 Bedrooms	$3,456
7 Bedrooms	$3,732
8 Bedrooms	$3,919

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
1BR	$1,350	$198,469	0.68%	D
2BR	$1,690	$310,517	0.54%	F
3BR	$2,290	$473,283	0.48%	F
4BR	$2,660	$571,044	0.47%	F
5BR	$3,086	$891,420	0.35%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 89502 (Reno, NV) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 89502 is set by HUD for 2026, with the following rates: - 0BR: $1120 - 1BR: $1290 - 2BR: $1620 - 3BR: $2200 - 4BR: $2560 These figures represent the maximum amount that a Section 8 voucher holder can pay for rent in Reno, NV. However, the actual rents in the area are significantly higher. For instance, the Zillow median price for a 2BR property is $301,909, which translates to a monthly mortgage payment of approximately $1,500 to $1,700, depending on interest rates and down payments. Given the price-to-FMR ratio of 15.5x, it is clear that the actual rental market far exceeds the FMR guidelines. This means that voucher holders face significant constraints in finding affordable housing, particularly in the 2BR and larger categories where the gap between FMR and market rents is most pronounced. #### Affordability & Renter Profile ZIP code 89502 has a population of 46,691, with 64.3% of residents being renters. The occupancy rate is 91.8%, indicating a relatively tight market with high demand for rental properties. The median household income is $65,328, and 2BR units at the FMR of $1620 represent 29.8% of this income. This suggests that the majority of renters in this area would struggle to afford market-rate rentals without assistance. The high percentage of renters and the tight occupancy rate indicate a strong need for affordable housing options, especially those that align with Section 8 guidelines. #### Investor Angle From an investor perspective, the ZIP code 89502 presents a challenging environment due to the significant discrepancy between FMR and market rents. A 2BR unit priced at the FMR of $1620 would likely be cash-flow negative when compared to the median market price of $301,909. Even if an investor could secure a property at a below-market rate, the rental income would still fall short of covering mortgage payments and other expenses. The investment grade for this ZIP code is low, primarily because the FMR rates are not reflective of the actual market conditions. Investors focusing on Section 8 vouchers would find it difficult to achieve positive cash flow, and they might have to rely on subsidies or other forms of government support to make ends meet. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should consider smaller units such as 0BR or 1BR properties, where the FMR is closer to the actual rental costs. For example, a 1BR unit at $1290 might be more feasible in terms of cash flow, even though the overall market is expensive. 2. **Seek Government Subsidies**: Since the FMR rates are well below market rates, investors should explore additional government subsidies or programs that can help bridge the gap. This might include Low-Income Housing Tax Credits (LIHTC), HOME Investment Partnerships Program, or other local initiatives aimed at making housing more affordable. 3. **Consider Long-Term Rental Agreements**: Investors might benefit from long-term rental agreements that lock in tenants at FMR rates, reducing the risk of vacancy and ensuring steady cash flow. This strategy can also help manage the financial impact of the low FMR rates. #### Bottom Line For investors focused on Section 8 vouchers, the recommendation for ZIP code 89502 is to **Skip**. The significant disparity between FMR and market rents makes it difficult to achieve positive cash flow, and the tight market conditions suggest that there will be limited opportunities to acquire properties at or near FMR levels. While there is a strong need for affordable housing in this area, the current market dynamics do not favor investors seeking to profit from Section 8 vouchers.

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.