Location: Santa Ana-Anaheim-Irvine, CA | Metro: Santa Ana-Anaheim-Irvine, CA HUD Metro FMR Area
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 | $3,160 |
| 1 Bedroom | $3,200 |
| 2 Bedrooms | $3,750 |
| 3 Bedrooms | $5,090 |
| 4 Bedrooms | $6,090 |
| 5 Bedrooms | $7,064 |
| 6 Bedrooms | $7,912 |
| 7 Bedrooms | $8,545 |
| 8 Bedrooms | $8,972 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $3,200 | $1,644,688 | 0.19% | F |
| 2BR | $3,750 | $2,240,074 | 0.17% | F |
| 3BR | $5,090 | $3,218,077 | 0.16% | F |
| 4BR | $6,090 | $4,672,645 | 0.13% | F |
| 5BR | $7,064 | $7,087,522 | 0.1% | F |
U.S. Census Bureau data (2024)
The ZIP code 92651, located in Laguna Beach, California, presents an interesting scenario when viewed from the renter's perspective. The median household income here stands at $146,604, which is significantly higher than the national average. However, the market rate rent, known as the Zillow Observed Rent Index (ZORI), is $5,355 per month. This places a considerable burden on renters, even with the relatively high median income.
To put this into context, let's consider the federal payment standard for housing vouchers, which is set at $3,470 for the fiscal year 2024 in this ZIP code. This amount is based on the Fair Market Rent (FMR) and represents the maximum monthly rental assistance a household can receive through the Housing Choice Voucher program, commonly referred to as Section 8. Given the stark difference between the ZORI ($5,355) and the FMR ($3,470), it's evident that the cost of renting in Laguna Beach far exceeds what is covered by the voucher program.
The ZIP code has a population of 23,557, with 33.0% being renters. This means there are approximately 7,773 renters in the area. The affordability gap, therefore, is significant, as many renters would struggle to cover the market rate rent without substantial financial assistance. For landlords, this implies a competitive market where attracting tenants willing to pay the full market rate could be challenging.
The takeaway for landlords considering voucher versus cash-pay strategies is clear. While cash-paying tenants might offer a higher monthly rent, they are fewer in number due to the high cost of living in Laguna Beach. On the other hand, voucher holders provide a steady stream of income, albeit at a lower rate than the market, but with the guarantee of timely payments and government backing. Landlords should weigh these factors carefully, considering both the immediate financial gain and long-term stability when deciding their tenant acquisition strategy.
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.