Section 8 Fair Market Rent (FMR) for ZIP 91606 - 2027

Investment Score for ZIP 91606

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	$2,130
1 Bedroom	$2,380
2 Bedrooms	$2,940
3 Bedrooms	$3,730
4 Bedrooms	$4,170
5 Bedrooms	$4,837
6 Bedrooms	$5,417
7 Bedrooms	$5,850
8 Bedrooms	$6,143

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$2,380	$444,618	0.54%	F
2BR	$2,940	$749,146	0.39%	F
3BR	$3,730	$875,369	0.43%	F
4BR	$4,170	$986,513	0.42%	F
5BR	$4,837	$1,122,162	0.43%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 91606 (Los Angeles, CA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 91606 in Los Angeles, CA, is set by HUD for 2026. For a two-bedroom unit, the FMR is $2,540. However, the Zillow median price for a two-bedroom unit in this area is significantly higher at $756,114. This results in a price-to-FMR ratio of 24.8x, indicating that actual market rents are far above the FMR. This means that Section 8 voucher holders face significant constraints when trying to find housing that fits within their budget. The FMR is only a fraction of what landlords might charge for rent in the open market. For example, a landlord charging the Zillow median price would be asking for approximately $3,280 per month in rent, which is well above the FMR of $2,540. Consequently, voucher holders must seek out units that are willing to accept the lower payment rates offered by the program, limiting their options to potentially less desirable properties. #### Affordability & Renter Profile ZIP code 91606 has a population of 43,559, with 68.2% of residents being renters. This high percentage of renters suggests a strong demand for rental housing in the area. The occupancy rate stands at 94.9%, indicating that the market is tight, with very little vacancy. Given the median household income of $66,200, it is clear that many residents are struggling to afford housing. The FMR for a two-bedroom unit represents 46.0% of the median income, meaning that even at the FMR level, a significant portion of the income goes towards rent. This makes it challenging for residents without financial assistance to find affordable housing. The high renter percentage and occupancy rate suggest that there is a robust need for rental units, but the affordability issue is severe. The majority of residents likely require some form of subsidy to manage their housing costs, making Section 8 vouchers particularly important in this market. #### Investor Angle From an investor perspective, the FMR levels provide a baseline for potential rental income. However, the actual market rents are much higher, which could make it difficult to achieve positive cash flow using only the FMR rates. For instance, a two-bedroom unit at the FMR of $2,540 would represent a significant discount compared to the Zillow median price of $756,114, which translates to a monthly rent of around $3,280 based on typical mortgage payments. To determine if this ZIP code is cash-flow positive at the FMR, we need to consider the typical expenses associated with owning and managing a rental property. These include mortgage payments, property taxes, insurance, maintenance, and management fees. Given the high price-to-FMR ratio, it is unlikely that an investor would be able to generate positive cash flow solely from the FMR rates. In terms of investment grade, the tight market and high renter percentage suggest that rental properties in this area are in high demand. However, the difficulty in finding tenants who can pay the FMR without additional subsidies and the high purchase price of properties make this a challenging investment environment. Investors should carefully evaluate the potential for long-term appreciation and the ability to attract and retain tenants who qualify for Section 8 vouchers. #### Specific Actionable Insights 1. **Focus on Properties Below FMR**: Investors should look for properties that are priced below the FMR to ensure they can attract Section 8 tenants. For a two-bedroom unit, this means targeting properties where the rent is closer to $2,540 rather than the Zillow median price of $756,114. This will help mitigate the risk of vacancy and ensure steady cash flow. 2. **Consider Renovation Projects**: Given the high price-to-FMR ratio, investors might find value in purchasing older or less desirable properties that are currently renting below market rates. By renovating these properties to improve their quality, they can increase the likelihood of attracting Section 8 tenants while still maintaining a competitive edge in the rental market. 3. **Engage with Local Housing Authorities**: To better understand the local demand for Section 8 vouchers and the process of becoming a Section 8 landlord, investors should engage with local housing authorities. This can provide valuable insights into the number of available vouchers, the waiting list length, and any specific requirements or incentives for participating in the program. #### Bottom Line Based on the provided data, the recommendation for Section 8-focused investors in ZIP code 91606 is to **Skip**. The extremely high price-to-FMR ratio indicates that the cost of acquiring properties in this area is not aligned with the rental income that can be generated through Section 8 vouchers alone. While there is a strong demand for rental housing, the challenge of finding properties that fit within the FMR guidelines and the difficulty in achieving positive cash flow make this a risky investment for those relying solely on Section 8 vouchers. Investors should consider other areas with a more favorable price-to-FMR ratio or explore alternative investment strategies that do not rely exclusively on Section 8 funding.

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.