Location: Riverside-San Bernardino-Ontario, CA | Metro: Riverside-San Bernardino-Ontario, CA MSA
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 | $1,650 |
| 1 Bedroom | $1,750 |
| 2 Bedrooms | $2,160 |
| 3 Bedrooms | $2,850 |
| 4 Bedrooms | $3,430 |
| 5 Bedrooms | $3,979 |
| 6 Bedrooms | $4,456 |
| 7 Bedrooms | $4,812 |
| 8 Bedrooms | $5,053 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,750 | $294,410 | 0.59% | F |
| 2BR | $2,160 | $439,107 | 0.49% | F |
| 3BR | $2,850 | $602,126 | 0.47% | F |
| 4BR | $3,430 | $774,559 | 0.44% | F |
| 5BR | $3,979 | $886,453 | 0.45% | F |
U.S. Census Bureau data (2024)
The Section 8 thesis for real estate investments in ZIP code 92211, located in Palm Desert, CA, centers around the disparity between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR in ZIP 92211 is set at $2160, while the market rent, as measured by Zillow's ZORI, stands at $2741. This represents a gap of $581, or approximately 27%, between what voucher holders can pay and the open-market rental rates.
In Palm Desert, where 27.8% of residents are renters, and the median home value is $533,927, landlords must consider the implications of accepting Section 8 tenants. The median household income in the area is $88,477, which suggests that the local economy supports higher rental prices reflective of the market conditions.
Given that the FMR is lower than the market rent, landlords who accept Section 8 vouchers will be renting their properties below the prevailing market rate. This means they will be subsidizing the difference of $581 per month, or about $7000 annually, for each unit occupied by a voucher tenant. While the federal government covers the majority of the rent through the voucher program, landlords should factor in the potential administrative burden and the risk of delayed payments when evaluating the financial impact of this decision.
The cost of housing voucher tenants below open-market rates includes not only the direct financial loss but also the opportunity cost of potentially renting to non-voucher tenants willing to pay the full market price. Landlords must weigh these factors against the stability and security provided by the Section 8 program, which guarantees timely payment of the government portion of the rent.
In conclusion, the Section 8 program in ZIP 92211 offers an opportunity for landlords to participate in a stable rental market, albeit at a discount compared to the open market. The decision to accept vouchers should be made with a full understanding of the financial implications and the local economic context.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.