Section 8 Fair Market Rent (FMR) for ZIP 92646 - 2027

Investment Score for ZIP 92646

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	$2,730
1 Bedroom	$2,770
2 Bedrooms	$3,240
3 Bedrooms	$4,400
4 Bedrooms	$5,260
5 Bedrooms	$6,102
6 Bedrooms	$6,834
7 Bedrooms	$7,381
8 Bedrooms	$7,750

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	$2,770	$571,033	0.49%	F
2BR	$3,240	$767,281	0.42%	F
3BR	$4,400	$1,293,585	0.34%	F
4BR	$5,260	$1,585,041	0.33%	F
5BR	$6,102	$1,761,124	0.35%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 92646 (Huntington Beach, CA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 92646 in Huntington Beach, CA, is set by HUD for 2026. The FMRs are as follows: - 0BR: $2850 - 1BR: $2920 - 2BR: $3440 - 3BR: $4670 - 4BR: $5580 These figures represent the maximum rent that a Section 8 voucher holder can pay. However, when comparing these FMRs to actual rental prices, it becomes clear that there is a significant gap. For instance, the Zillow median price for a 2BR unit is $752,327, which translates into a monthly mortgage payment of approximately $3,050 based on a 4.5% interest rate over a 30-year term. This means that even a 2BR unit, which has the lowest price-to-FMR ratio among the listed units, is still priced at about 18.2 times the FMR. Given this context, voucher holders face severe constraints. They would struggle to find properties within their budget, especially since the FMR for a 2BR unit is only $3440, which is far below the actual market rent. This makes it challenging for voucher holders to secure housing in this area. #### Affordability & Renter Profile ZIP code 92646 has a median household income of $130,672, indicating a relatively affluent population. With a 25.6% renter percentage, the market is primarily composed of homeowners, but there is still a substantial number of renters. The occupancy rate of 95.7% suggests that the market is quite tight, with very little vacancy. The affordability issue is starkly evident. A 2BR unit's FMR represents only 31.6% of the median income, meaning that it is affordable for those earning less than the median household income. However, the actual median rental price for a 2BR unit is significantly higher, making it difficult for many renters to afford housing without financial assistance. This tight market condition implies that there is a high demand for rental units, which could lead to upward pressure on rental prices. #### Investor Angle From an investor perspective, the ZIP code 92646 presents both opportunities and challenges. The high median home value and low FMR suggest that the cash flow potential for rental properties is limited if the investor adheres strictly to the FMR guidelines. For example, a 2BR unit with a Zillow median price of $752,327 would have a monthly mortgage payment of around $3,050, which is already above the FMR of $3440. This leaves little room for profit unless the property can be rented out at a higher rate or the investor is willing to accept lower returns. In terms of investment grade, the high price-to-FMR ratio indicates that the market is not favorable for Section 8-focused investors. The ratio of 18.2x for a 2BR unit is exceptionally high, suggesting that the actual rental market is far more expensive than what HUD considers fair market rent. Therefore, the investment grade for this ZIP code is low for Section 8 properties due to the significant gap between FMR and actual market rents. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should focus on smaller units such as 0BR or 1BR apartments. These units have FMRs of $2850 and $2920 respectively, which are closer to the actual rental prices in the market. This will help mitigate the risk of losing money on mortgage payments. 2. **Seek Properties Below Market Value**: Investors should look for off-market deals or properties that are priced below the Zillow median. For instance, finding a 2BR unit for less than $752,327 could make it feasible to operate within the FMR guidelines while still generating a reasonable return. This might involve working with local real estate agents who have access to listings that are not publicly advertised. 3. **Consider Long-Term Appreciation**: While cash flow might be limited, the long-term appreciation of property values in Huntington Beach could provide a strong return on investment. Investors should consider the potential for capital gains over time, especially given the high median home value and the affluent nature of the community. #### Bottom Line Based on the analysis, the recommendation for Section 8-focused investors in ZIP code 92646 is to **Skip**. The high price-to-FMR ratio and the tight rental market make it difficult to find properties that offer positive cash flow while adhering to HUD’s guidelines. Additionally, the high median home value and low FMR indicate that the market is not aligned with the needs of voucher holders. Therefore, investing in this ZIP code with a focus on Section 8 vouchers is likely to result in financial losses or suboptimal returns.

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.