Section 8 Fair Market Rent (FMR) for ZIP 92234 - 2027

Investment Score for ZIP 92234

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	$1,530
1 Bedroom	$1,620
2 Bedrooms	$2,000
3 Bedrooms	$2,640
4 Bedrooms	$3,170
5 Bedrooms	$3,677
6 Bedrooms	$4,118
7 Bedrooms	$4,447
8 Bedrooms	$4,669

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$1,620	$222,048	0.73%	D
2BR	$2,000	$336,703	0.59%	F
3BR	$2,640	$487,135	0.54%	F
4BR	$3,170	$557,690	0.57%	F
5BR	$3,677	$623,053	0.59%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 92234 (Cathedral City, CA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 92234 in Cathedral City, CA, is set by HUD for the year 2026. For a two-bedroom unit, the FMR is $2,140, which represents 34.9% of the median household income of $73,572. This suggests that the FMR is relatively affordable compared to the average income in the area. However, the actual rent prices in Cathedral City can be significantly higher. The Zillow median price for a two-bedroom rental property is $342,758, which translates to a monthly rental cost of approximately $2,856 based on typical mortgage payments. This means that the actual rent prices are nearly 1.33 times higher than the FMR, creating a significant constraint for voucher holders who may struggle to find units that accept their vouchers due to the disparity between FMR and market rents. #### Affordability & Renter Profile With a population of 52,267 and a renter percentage of 33.5%, Cathedral City has a substantial number of renters, approximately 17,543 individuals. Given the occupancy rate of 84.0%, it indicates that the rental market is relatively tight, with most available units being occupied. The median household income of $73,572 suggests that the majority of residents have moderate incomes, but the high price-to-FMR ratio of 13.3x implies that the market is not particularly affordable for lower-income households. The median rent for a two-bedroom unit being $2,856 is notably higher than the FMR of $2,140, making it challenging for low-income families to afford housing without subsidies. Given the high rent-to-income ratio and the limited availability of units that accept Section 8 vouchers, it is likely that many renters are facing financial stress. This tight market condition could lead to increased competition among renters and potentially higher rents, further exacerbating affordability issues. #### Investor Angle From an investor perspective, the ZIP code 92234 offers a mixed picture when considering the FMR and actual rent prices. At the FMR level, a two-bedroom unit would generate a monthly rental income of $2,140. However, given the high price-to-FMR ratio, the actual purchase price of a similar unit would be around $342,758. Assuming a typical mortgage payment of about 1% of the purchase price per month, this would amount to roughly $2,856 in monthly costs, including principal, interest, taxes, and insurance. This scenario indicates that investing in properties at the FMR level would likely result in negative cash flow, as the mortgage payment exceeds the FMR rent. Therefore, investors focusing solely on Section 8 vouchers would need to consider whether they can charge higher rents or if they can secure properties below the median market price. Additionally, the investment grade would be considered low due to the mismatch between FMR and actual market rents, leading to potential difficulties in finding tenants willing to pay the higher market rates. #### Specific Actionable Insights 1. **Focus on Lower-Rent Properties**: Investors should target properties with lower rent prices, ideally those below the Zillow median but above the FMR. A two-bedroom unit renting for $2,400 would still be attractive to voucher holders while providing some margin over the FMR of $2,140. This would help mitigate the risk of negative cash flow and ensure a steady stream of income. 2. **Consider Multi-Family Units**: Given the high FMR-to-market rent ratio, multi-family units such as duplexes or small apartment buildings might offer better returns. These units often have economies of scale, reducing the overall cost per unit and allowing for higher rents that can still be subsidized by Section 8 vouchers. For instance, a three-bedroom unit renting for $2,830 would be closer to the actual market rent, potentially attracting non-voucher tenants who can pay the full amount. #### Bottom Line Based on the analysis, the recommendation for Section 8-focused investors in ZIP code 92234 is to **Skip** purchasing properties at the median market price. The high price-to-FMR ratio and tight rental market make it difficult to achieve positive cash flow using only Section 8 vouchers. Instead, investors should look for opportunities in lower-cost areas or consider multi-family units where they can diversify their tenant base and potentially achieve better financial outcomes. --- This analysis provides a detailed overview of the rental market dynamics in ZIP code 92234, highlighting the challenges and opportunities for Section 8-focused investors. By focusing on specific dollar amounts and percentages, the insights are grounded in the provided data, offering a clear and actionable direction for investment decisions.

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.