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 | $2,460 |
| 1 Bedroom | $2,750 |
| 2 Bedrooms | $3,390 |
| 3 Bedrooms | $4,300 |
| 4 Bedrooms | $4,810 |
| 5 Bedrooms | $5,580 |
| 6 Bedrooms | $6,250 |
| 7 Bedrooms | $6,750 |
| 8 Bedrooms | $7,088 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $3,390 | $711,559 | 0.48% | F |
| 3BR | $4,300 | $908,134 | 0.47% | F |
| 4BR | $4,810 | $1,119,126 | 0.43% | F |
| 5BR | $5,580 | $1,649,181 | 0.34% | F |
U.S. Census Bureau data (2024)
The Section 8 thesis for properties in ZIP code 91711, located in Claremont, CA, centers around the disparity between the Fair Market Rent (FMR) and the actual market rent. The FMR for ZIP 91711 in fiscal year 2024 is set at $2860, while the market rent, as indicated by the Zillow Observed Rent Index (ZORI), stands at $3330. This creates a gap of $470, or approximately 16.4%, between what landlords can charge under the Section 8 program and the prevailing market rate.
In Claremont, where 36.5% of residents are renters and the median home value is $1,040,662, the lower FMR can be seen as a challenge for landlords looking to maximize their returns. However, it also presents an opportunity for those willing to accept housing vouchers. The median income in Claremont is $126,056, which means that many residents are well above the income eligibility thresholds for Section 8, making the program a viable option for filling vacancies that might otherwise go unfilled due to the high cost of living.
The cost of accepting housing voucher tenants below open-market rates is significant. For every unit rented through Section 8, landlords forego $470 per month compared to the market rent. Over the course of a year, this amounts to a loss of $5640 per unit. This financial impact must be weighed against the benefits of stable tenancy and the support provided by the government in managing these units.
To illustrate, consider a property with five rental units. If all units were rented at market rates, the landlord would collect $16,650 monthly. With four units occupied by voucher tenants and one by a market-rate tenant, the landlord would only collect $14,680 monthly, a difference of $1,970. This reduction in revenue can affect the overall yield of the investment portfolio, particularly when factoring in maintenance costs and property management fees.
Despite the lower rents, landlords can still achieve positive cash flow and a decent return on investment in Claremont. The high median home value suggests a robust local economy, which can help offset some of the financial challenges associated with the Section 8 program. Additionally, the stability provided by the government-backed payments can be attractive for small-portfolio investors who prefer consistent income over the volatility of the open market.
For landlords in ZIP 91711, understanding the implications of the FMR versus market rent is crucial. While the gap represents a significant financial consideration, the broader economic context of Claremont offers a balanced perspective on the viability of participating in the Section 8 program.
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.