Location: Santa Maria-Santa Barbara, CA | Metro: Santa Maria-Santa Barbara, CA MSA
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 | $3,070 |
| 1 Bedroom | $3,360 |
| 2 Bedrooms | $3,850 |
| 3 Bedrooms | $4,950 |
| 4 Bedrooms | $5,650 |
| 5 Bedrooms | $6,554 |
| 6 Bedrooms | $7,340 |
| 7 Bedrooms | $7,927 |
| 8 Bedrooms | $8,323 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $3,360 | $1,110,117 | 0.3% | F |
| 2BR | $3,850 | $1,331,965 | 0.29% | F |
| 3BR | $4,950 | $1,644,111 | 0.3% | F |
| 4BR | $5,650 | $2,001,295 | 0.28% | F |
| 5BR | $6,554 | $2,662,119 | 0.25% | F |
U.S. Census Bureau data (2024)
Santa Barbara, CA's ZIP code 93101 represents a densely populated urban neighborhood with a significant rental market. With a total population of 31,554, it stands out due to the high percentage of renters at 77.1%, indicating a strong demand for rental properties. The median household income in this area is $90,148, which suggests that residents have a relatively stable financial standing. Furthermore, the median home value in ZIP 93101 is $1,458,315, reflecting the premium nature of the real estate market in this part of Santa Barbara.
The rent economics in ZIP 93101 are favorable for investors. The Fair Market Rent (FMR) for the fiscal year 2024 is set at $3,660, while the Zillow Observed Rent Index (ZORI) indicates a market rent of $3,442. This means that landlords can expect to charge rents slightly above the market average without exceeding the government-set limits for Section 8 vouchers. The difference between the FMR and ZORI provides a buffer that allows for competitive pricing while ensuring compliance with housing assistance programs.
Considering these factors, ZIP 93101 is well-suited for both hands-off voucher operators and hands-on value-add buyers. For those looking to manage properties with minimal effort, the high renter percentage and stable income levels make it an ideal location for Section 8 tenants. Meanwhile, value-add buyers can leverage the existing market dynamics to improve property conditions and potentially increase rental income, given the higher FMR compared to the current market rates. However, the premium median home value suggests that there might be opportunities for higher-end renovations or upgrades that could command even greater rents, appealing to a broader range of potential tenants beyond just those utilizing Section 8 vouchers.
In summary, ZIP 93101 offers a robust rental market with strong demand and stable tenant incomes, making it an attractive investment opportunity for both passive and active real estate investors. The slight margin between the FMR and ZORI supports effective management strategies, whether focused on maintaining compliance or enhancing 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.