Section 8 Fair Market Rent (FMR) for ZIP 92867 - 2027

Investment Score for ZIP 92867

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	$2,420
1 Bedroom	$2,480
2 Bedrooms	$2,920
3 Bedrooms	$3,960
4 Bedrooms	$4,730
5 Bedrooms	$5,487
6 Bedrooms	$6,145
7 Bedrooms	$6,637
8 Bedrooms	$6,969

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
2BR	$2,920	$817,573	0.36%	F
3BR	$3,960	$1,095,013	0.36%	F
4BR	$4,730	$1,371,408	0.34%	F
5BR	$5,487	$1,763,446	0.31%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 92867 (Orange, CA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 92867 is set by HUD for the year 2026. For a two-bedroom unit, the FMR is $2,910. However, the actual rental market price for a two-bedroom unit, based on Zillow data, is significantly higher at $825,861. This means that the price-to-FMR ratio is 23.7 times the FMR, indicating a substantial gap between the FMR and actual market rents. Given that the FMR for a two-bedroom unit represents only 26.7% of the median household income ($130,741), it is clear that the FMR is not reflective of the actual cost of renting in this area. The disparity suggests that Section 8 voucher holders face significant constraints in finding housing within their budget. For instance, a voucher holder would struggle to find a three-bedroom unit priced at $3,950, which is well above the FMR of $2,910. #### Affordability & Renter Profile ZIP code 92867 has a population of 44,726, with 33.9% being renters. The occupancy rate is high at 97.4%, suggesting that the rental market is tight and there is little excess supply. Given the median household income of $130,741, most residents are likely to be middle to upper-middle class individuals who can afford the high rent prices. The fact that the FMR is so far below the actual market rent indicates that the area is not particularly affordable for low-income households. The high price-to-FMR ratio of 23.7x implies that the rental market is highly competitive and that landlords have considerable pricing power. This tight market condition makes it challenging for voucher holders to secure housing, as they are limited to the FMR rates, which are much lower than what the market demands. #### Investor Angle From an investor’s perspective, the ZIP code 92867 presents a mixed picture when considering cash flow and investment grade. The FMR for a two-bedroom unit is $2,910, but the actual market price is $825,861, which is more than 23 times the FMR. While the high market prices might suggest strong potential returns, the reality is that these units are not affordable for Section 8 voucher holders. To determine if this ZIP code is cash-flow positive at FMR, we need to consider the typical operating expenses and mortgage payments associated with properties in this area. Assuming a conservative estimate of 50% of the property value going towards the mortgage (with a 30-year fixed-rate mortgage at 5%), the monthly mortgage payment for a $825,861 property would be approximately $4,100. Adding typical operating expenses such as maintenance, insurance, and property taxes, which could amount to another $1,000 per month, brings the total monthly expenses to around $5,100. This is significantly higher than the FMR of $2,910, indicating that properties rented at FMR would likely result in negative cash flow. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should focus on smaller units, such as one-bedroom or studio apartments, where the FMR is lower. For example, the FMR for a one-bedroom unit is $2,470, which is still far below the market price but offers a better chance of attracting tenants with vouchers. 2. **Consider Alternative Funding Sources**: Since renting at FMR would likely lead to negative cash flow, investors should explore alternative funding sources, such as government subsidies or tax credits, to offset the financial burden. Additionally, investors might want to consider purchasing properties at a discount or through distressed sales to improve the cash flow situation. #### Bottom Line For Section 8-focused investors, ZIP code 92867 is not recommended for purchase due to the significant gap between FMR and actual market rents. The high price-to-FMR ratio and the resulting negative cash flow make it difficult to achieve profitability. Investors should either look into other ZIP codes with more favorable ratios or consider alternative investment strategies that do not rely solely on Section 8 vouchers. The recommendation is to **skip** this ZIP code for now and wait for more favorable conditions or explore other areas with better alignment between FMR and market rents.

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.