Location: San Diego-Chula Vista-Carlsbad, CA | Metro: San Diego-Chula Vista-Carlsbad, CA MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $2,190 |
| 1 Bedroom | $2,330 |
| 2 Bedrooms | $2,820 |
| 3 Bedrooms | $3,740 |
| 4 Bedrooms | $4,520 |
| 5 Bedrooms | $5,243 |
| 6 Bedrooms | $5,872 |
| 7 Bedrooms | $6,342 |
| 8 Bedrooms | $6,659 |
The analysis of the Section 8 cap-rate scenario for ZIP code 92174 in California reveals some limitations due to missing data points. However, we can still derive a rough picture based on the available information.
The Fair Market Rent (FMR) for a 2-bedroom apartment in ZIP 92174 for fiscal year 2024 is set at $2830 per month. This translates to an annualized income of $33,960 for a property that qualifies under the Section 8 program. The median home value is not available, which makes it challenging to calculate the implied gross yield directly. However, the lack of market rent data also complicates a direct comparison between Section 8 rents and market rents.
In the absence of market rent data, let's assume a hypothetical market rent scenario for illustrative purposes. If the market rent were higher than the Section 8 rate, say $3000 per month, this would result in an annualized market rent of $36,000. Given the missing median home value, we cannot accurately state the gross yield for either scenario. However, it's important to note that the gross yield from Section 8 rental income would be lower than that from market rent, assuming comparable property values.
The renter density and days on market (DOM) are also not provided, which are crucial metrics for assessing the feasibility and demand for rental properties in this area. Without these figures, it's difficult to determine which scenario is more realistic. Generally, if the renter density is high and the DOM is low, it suggests strong demand for rentals, making market rent potentially more attractive. Conversely, if the renter density is low and the DOM is high, the stability and guaranteed income from Section 8 might be more appealing.
To summarize, while the exact gross yields cannot be calculated due to missing data, the annualized income from Section 8 at $33,960 is less than our hypothetical market rent scenario at $36,000. The decision between these options should consider local demand factors and the overall financial stability preferred by the investor.
Data Sources: FMR data from HUD (2027).
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.