Section 8 Fair Market Rent (FMR) for ZIP 92821 - 2027

Investment Score for ZIP 92821

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	$2,710
1 Bedroom	$2,740
2 Bedrooms	$3,210
3 Bedrooms	$4,360
4 Bedrooms	$5,210
5 Bedrooms	$6,044
6 Bedrooms	$6,769
7 Bedrooms	$7,311
8 Bedrooms	$7,677

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	$2,740	$493,545	0.56%	F
2BR	$3,210	$733,429	0.44%	F
3BR	$4,360	$1,025,752	0.43%	F
4BR	$5,210	$1,222,680	0.43%	F
5BR	$6,044	$1,442,757	0.42%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 92821 (Brea, CA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) figures for ZIP code 92821, set by HUD for 2026, indicate that a two-bedroom unit should rent for $3,370. However, the Zillow median price for a two-bedroom unit is significantly higher at $731,416, which translates to a price-to-FMR ratio of 18.1x. This means that actual market rents are far above the FMR levels. For instance, a two-bedroom unit priced at the Zillow median would cost approximately $3,000 per month in mortgage payments alone, assuming a 4.5% interest rate and a 20-year amortization schedule. The disparity between FMR and actual rents imposes significant constraints on voucher holders, who might find it challenging to secure housing within their budget. #### Affordability & Renter Profile ZIP code 92821 has a population of 41,623, with 42.5% being renters. The occupancy rate stands at 97.2%, indicating a highly competitive rental market with limited availability. Given the median household income of $123,629, the 32.7% of median income required for a two-bedroom unit at FMR suggests that the typical resident can afford the rent. However, for those relying on Section 8 vouchers, the situation is much tighter. A voucher holder would need to find a landlord willing to accept a rent of $3,370, which is well below the market rate. The high occupancy rate and the significant gap between FMR and market rents suggest that the market is tight and likely favors landlords over tenants. #### Investor Angle From an investor perspective, the ZIP code 92821 presents a challenging environment for cash flow positive investments at the FMR level. Given the Zillow median price of $731,416 for a two-bedroom unit, the monthly mortgage payment would be around $3,000, leaving little room for profit when considering the FMR of $3,370. Moreover, property taxes, insurance, maintenance, and other costs would further reduce potential earnings. The investment grade for properties in this ZIP code, particularly those targeting Section 8 tenants, would be low due to the difficulty in finding tenants willing to pay market rates and landlords willing to accept lower rents. #### Specific Actionable Insights 1. **Target Lower-Rent Units**: Investors focusing on Section 8 should consider targeting smaller units such as one-bedroom apartments, where the FMR is $2,860. This could provide a better chance of attracting tenants and maintaining profitability, given the lower initial investment and potentially lower operating costs. 2. **Negotiate with Landlords**: Given the high demand and tight supply, negotiating with landlords to accept slightly higher rents than the FMR could be beneficial. For example, a two-bedroom unit rented at $3,600 instead of $3,370 would still be attractive to voucher holders and could improve the investor's cash flow. 3. **Consider Long-Term Appreciation**: While cash flow might be negative in the short term, the long-term appreciation of properties in Brea, CA, could make it a worthwhile investment. The median home value is expected to rise, potentially offsetting the initial financial strain. #### Bottom Line For Section 8-focused investors, the ZIP code 92821 is a challenging market due to the significant gap between FMR and market rents. The recommendation is to **Skip** this ZIP code for immediate cash flow positive investments. Instead, consider areas with a more favorable price-to-FMR ratio or focus on units that are closer to the FMR levels, such as one-bedroom apartments. If you are willing to take a longer-term view and accept the possibility of negative cash flow initially, then **Hold** might be a viable strategy, but only if you have a strong belief in the future appreciation of property values.

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.