Location: Los Angeles-Long Beach-Glendale, CA | Metro: Los Angeles-Long Beach-Glendale, CA HUD Metro FMR Area
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 | $2,920 |
| 1 Bedroom | $3,260 |
| 2 Bedrooms | $4,020 |
| 3 Bedrooms | $5,100 |
| 4 Bedrooms | $5,710 |
| 5 Bedrooms | $6,624 |
| 6 Bedrooms | $7,419 |
| 7 Bedrooms | $8,013 |
| 8 Bedrooms | $8,414 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $3,260 | $421,878 | 0.77% | D |
| 2BR | $4,020 | $642,563 | 0.63% | D |
| 3BR | $5,100 | $983,342 | 0.52% | F |
| 4BR | $5,710 | $1,115,311 | 0.51% | F |
| 5BR | $6,624 | $1,370,219 | 0.48% | F |
U.S. Census Bureau data (2024)
A skeptical investor looking at ZIP 90732 in Los Angeles, CA, might have several concerns regarding the feasibility of investing in rental properties through the Section 8 program. Here are some common objections, addressed with the data at hand.
Will Fair Market Rent (FMR) of $3,550 cover the mortgage on an $888,963 home?
The FMR for ZIP 90732 is set at $3,550 for fiscal year 2024. This figure represents the maximum amount that can be charged for a rental unit under the Section 8 program. However, whether this will sufficiently cover the mortgage on a home priced at $888,963 depends on the interest rate and loan terms. For instance, if we consider a fixed-rate mortgage at an average interest rate of 5%, the monthly mortgage payment for a $888,963 home would be approximately $4,500. Clearly, the FMR does not cover this amount, suggesting that the investment might not be profitable solely based on Section 8 payments. The investor must also factor in property taxes, insurance, and maintenance costs, which further diminish the profitability.
Is there enough renter demand at 27.9%?
The percentage of renter-occupied housing units in ZIP 90732 is 27.9%. While this indicates a significant portion of the population is renting, it's important to note that the demand for Section 8 rental units is typically lower due to the strict requirements and regulations associated with the program. This percentage alone does not guarantee sufficient demand for Section 8 properties. Investors should look into local market trends and consult with local real estate agents to gauge the actual demand for Section 8 rentals.
Will vouchers keep pace with $2,942 market rents?
The average market rent in ZIP 90732 is $2,942. Given that the FMR is higher at $3,550, it suggests that vouchers could potentially cover a substantial portion of the market rent. However, the actual voucher amount is determined by the local Housing Authority and can vary. In many cases, the voucher amount does not fully match the market rent, leading to gaps that landlords must fill. Investors need to understand that while vouchers provide a reliable source of income, they might not always cover the full rent, especially for higher-end properties.
In conclusion, while ZIP 90732 presents opportunities for rental investments, particularly under the Section 8 program, the data shows that the FMR might not fully cover mortgage expenses on a high-priced home. Additionally, the percentage of renters does not necessarily translate to high demand for Section 8 properties, and voucher amounts may not keep pace with market rents, leaving potential gaps for landlords to manage.
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.