Location: El Centro, CA | Metro: El Centro, CA MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,260 |
| 1 Bedroom | $1,370 |
| 2 Bedrooms | $1,770 |
| 3 Bedrooms | $2,380 |
| 4 Bedrooms | $2,930 |
| 5 Bedrooms | $3,399 |
| 6 Bedrooms | $3,807 |
| 7 Bedrooms | $4,112 |
| 8 Bedrooms | $4,318 |
U.S. Census Bureau data (2024)
The Section 8 thesis in ZIP 92259 is centered around the gap between the Fair Market Rent (FMR) of $1460 (for fiscal year 2024) and the current market rent of $1450. This indicates a slight premium of $10 or approximately 0.7% above the market rent for Section 8 vouchers.
In ZIP 92259, where 26.1% of residents are renters and the median household income is $43,500, the FMR slightly exceeds the market rent. This makes the area a yield play for landlords and small-portfolio investors who can secure a higher rental income through Section 8 vouchers compared to the open market. The gap allows landlords to receive a rent subsidy that brings their total income closer to the FMR, thereby ensuring a more stable and predictable cash flow.
Despite the low median home value being not available, the rental market in 92259 is relatively cool, indicating a lower demand compared to the national average. The average rent in 92259 is 28% lower than the national average, which stands at $2000. This suggests that the rental market in 92259 is less competitive, making it easier for landlords to attract tenants through the Section 8 program.
The slight premium offered by the FMR means that landlords can still achieve a decent yield even when renting to voucher tenants. However, they should be mindful of the administrative overhead associated with managing Section 8 properties, including tenant screening and lease agreements, which can be handled more efficiently through platforms like Zillow Rentals.
Investors should consider the local economic context and the availability of rental properties when deciding whether to participate in the Section 8 program. With only 1 rental property currently available, the market presents a unique opportunity for those willing to navigate the nuances of the program.
Data Sources: FMR data from HUD (2027). 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.