Section 8 Fair Market Rent (FMR) for ZIP 92101 - 2027

Investment Score for ZIP 92101

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	$3,180
1 Bedroom	$3,380
2 Bedrooms	$4,090
3 Bedrooms	$5,420
4 Bedrooms	$6,560
5 Bedrooms	$7,610
6 Bedrooms	$8,523
7 Bedrooms	$9,205
8 Bedrooms	$9,665

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	$3,380	$502,306	0.67%	D
2BR	$4,090	$845,264	0.48%	F
3BR	$5,420	$1,266,025	0.43%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 92101 (San Diego, CA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 92101, as of 2026, is set at $4310 for a two-bedroom unit. This amount represents 56.5% of the median household income in the area, which stands at $91,566. However, the actual median rent for a two-bedroom unit on Zillow is significantly higher at $874,551, resulting in a price-to-FMR ratio of 16.9x. This means that the actual rent is nearly 17 times the FMR, indicating a substantial gap between what is considered fair market rent and the actual rental prices in the market. For voucher holders, this creates significant constraints. The maximum allowable rent under the Section 8 program is capped at the FMR, meaning that tenants with vouchers would struggle to find affordable housing options in this ZIP code. The high actual rents suggest that landlords might be less inclined to accept Section 8 vouchers due to the limited financial benefit they offer compared to market rates. #### Affordability & Renter Profile ZIP code 92101 has a high percentage of renters at 77.4%, indicating a strong demand for rental properties. The occupancy rate of 87.3% suggests that the market is relatively tight, with most units occupied. Given the median household income of $91,566 and the high median rent of $874,551 for a two-bedroom unit, it is clear that the majority of renters are likely to be middle-class individuals or families who can afford the high costs of living in this area. However, the significant disparity between the FMR and the actual rent prices indicates that affordability is a major issue for lower-income residents, particularly those relying on Section 8 vouchers. The tight market conditions mean that there is little room for oversupply, and any new rental units entering the market are likely to be quickly absorbed by the high demand. This also implies that rental prices are unlikely to decrease significantly in the near future, maintaining the challenging affordability landscape. #### Investor Angle From an investor perspective, the ZIP code 92101 presents a mixed picture. While the high actual rent prices indicate a strong market with potential for high returns, the FMR caps present a challenge for cash flow when considering Section 8-focused investments. At the FMR of $4310 for a two-bedroom unit, an investor would need to ensure that their cost structure allows for profitability at these lower rates. Given the price-to-FMR ratio of 16.9x, it is evident that the market is highly inflated relative to the FMR. This makes it difficult for investors to achieve positive cash flow if they rely solely on FMR rates. The investment grade in this ZIP code would likely be rated as low for Section 8-focused investors due to the limited financial upside and the competitive nature of the market. #### Specific Actionable Insights 1. **Focus on Non-Section 8 Investments**: Given the high actual rent prices and the low FMR caps, investors should consider focusing on non-Section 8 rental properties. This will allow them to capture the higher market rents and improve their overall cash flow. For instance, a two-bedroom unit renting at the Zillow median of $874,551 per year ($72,879 per month) would yield significantly more revenue than one rented at the FMR of $4310 per month. 2. **Consider Renovation Projects**: Investors could look into purchasing older properties that might be undervalued relative to the market. By renovating these properties, they can potentially increase the rental value and attract tenants willing to pay market rates. This strategy would require an initial capital investment but could provide a higher return over time. #### Bottom Line For Section 8-focused investors, the recommendation is to **skip** ZIP code 92101. The significant gap between the FMR and actual market rents makes it challenging to achieve positive cash flow while adhering to the voucher program's restrictions. Instead, investors should explore other areas where the FMR is closer to the actual market rents, providing better opportunities for both affordability and profitability. Alternatively, investors could focus on non-Section 8 rental properties in this ZIP code to take advantage of the high demand and inflated rental market.

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.