Section 8 Fair Market Rent (FMR) for ZIP 92025 - 2027

Investment Score for ZIP 92025

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	$2,010
1 Bedroom	$2,140
2 Bedrooms	$2,590
3 Bedrooms	$3,430
4 Bedrooms	$4,150
5 Bedrooms	$4,814
6 Bedrooms	$5,392
7 Bedrooms	$5,823
8 Bedrooms	$6,114

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	$2,140	$452,739	0.47%	F
2BR	$2,590	$582,983	0.44%	F
3BR	$3,430	$819,279	0.42%	F
4BR	$4,150	$1,141,670	0.36%	F
5BR	$4,814	$1,422,400	0.34%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 92025 (Escondido, CA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 92025, as per the 2026 data, is set at $2760 for a two-bedroom unit. This amount represents 40.8% of the median household income of $81,106, indicating that it is within the affordability range for many residents. However, the actual rental market is significantly higher. The Zillow median price for a two-bedroom unit is $588,874, which translates to a monthly rent of approximately $2744 based on a 4% cap rate. This means that the actual market rent for a two-bedroom unit is roughly $2744, which is very close to the FMR but still slightly above it. Therefore, voucher holders face a constraint where they must find units priced at or below $2760 to be eligible for full coverage under their vouchers. #### Affordability & Renter Profile ZIP code 92025 has a high percentage of renters at 56.6%, suggesting a strong demand for rental properties. With a population of 49,989 and an occupancy rate of 95.4%, the market is relatively tight, implying limited availability of rental units. Given that the median household income is $81,106, the majority of residents would struggle to afford the Zillow median price of $588,874 for a two-bedroom home without financial assistance. The high price-to-FMR ratio of 17.8x indicates that the market is overpriced relative to what the government considers fair, making it challenging for low-income renters to find affordable housing without assistance. #### Investor Angle From an investor perspective, the ZIP code 92025 presents a mixed scenario. The FMR for a two-bedroom unit is $2760, which is close to the actual market rent of around $2744. This suggests that investors can potentially achieve positive cash flow if they manage to acquire properties at or near the FMR. However, the high price-to-FMR ratio of 17.8x implies that the acquisition cost of properties is significantly higher than the FMR, which could lead to negative cash flow if the property is purchased at market rates. For an investment to be profitable, the purchase price should be substantially lower than the market value, ideally closer to the FMR. The investment grade for this ZIP code is moderate due to the high demand for rentals and the significant gap between FMR and market prices. Investors should carefully consider the acquisition costs and potential rental yields before making any decisions. #### Specific Actionable Insights 1. **Target Acquisition Price**: Investors should aim to purchase properties at a price that allows them to rent out units at or below the FMR. For example, a two-bedroom unit should be acquired for less than $588,874 to ensure a positive cash flow when renting at $2760. A reasonable target might be to seek properties priced around $150,000 to $200,000, which would align more closely with the FMR. 2. **Focus on Smaller Units**: Given the high price-to-FMR ratio, smaller units such as one-bedroom apartments may offer better opportunities for positive cash flow. The FMR for a one-bedroom unit is $2260, which is lower than the Zillow median price for a two-bedroom unit. Investors should consider diversifying their portfolio to include a mix of one-bedroom and two-bedroom units to balance risk and reward. #### Bottom Line For Section 8-focused investors, the recommendation is to **Hold** or **Skip** purchasing properties in ZIP code 92025 unless they can secure properties at a substantial discount to the market price. The high price-to-FMR ratio and the tight rental market make it difficult to achieve positive cash flow at current market prices. However, if investors can identify undervalued properties or negotiate lower purchase prices, there may be opportunities to enter the market profitably. Otherwise, it is advisable to wait for more favorable conditions or explore other ZIP codes with a better alignment between FMR and market prices. --- This analysis provides a comprehensive overview of the rental market dynamics, affordability concerns, and investment potential in ZIP code 92025, Escondido, CA, using only the data provided. It highlights the challenges faced by both renters and investors and offers specific insights to navigate these complexities effectively.

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.