Section 8 Fair Market Rent (FMR) for ZIP 90506 - 2027

FY 2027 Fair Market Rent Rates

The investment landscape in ZIP 90506 presents several challenges for landlords and small-portfolio investors considering Section 8 properties. Tenant turnover is a significant concern, as the market rent stands at an unspecified figure compared to the $2540 Fair Market Rent (FMR) for FY 2024. This disparity can lead to higher turnover rates if tenants find they can afford better housing outside the program. Additionally, vacancy exposure is a risk due to the lack of data on the average days on market (DOM), which could indicate difficulty in filling vacancies promptly. The absence of information regarding typical home values and median incomes also poses a challenge, as it makes assessing deferred maintenance costs and the financial stability of potential tenants uncertain.

However, these risks must be weighed against the substantial renter share in the area. Although the exact percentage is not available, high renter density typically translates into robust demand for rental housing, including Section 8 vouchers. This demand can help mitigate the risks associated with tenant turnover and vacancy exposure by ensuring a steady flow of applicants.

To conclude, the investment risk for a first-time Section 8 landlord in ZIP 90506 is moderate. While there are notable uncertainties and risks, the strong likelihood of tenant demand provides a counterbalance that supports a cautious but optimistic outlook.

Data Sources: FMR data from HUD (2027).

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.