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 | $2,900 |
| 1 Bedroom | $3,170 |
| 2 Bedrooms | $3,630 |
| 3 Bedrooms | $4,660 |
| 4 Bedrooms | $5,330 |
| 5 Bedrooms | $6,183 |
| 6 Bedrooms | $6,925 |
| 7 Bedrooms | $7,479 |
| 8 Bedrooms | $7,853 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $3,170 | $857,270 | 0.37% | F |
| 2BR | $3,630 | $1,404,322 | 0.26% | F |
| 3BR | $4,660 | $1,983,663 | 0.23% | F |
| 4BR | $5,330 | $2,472,907 | 0.22% | F |
| 5BR | $6,183 | $3,235,591 | 0.19% | F |
U.S. Census Bureau data (2024)
The Section 8 program in ZIP code 93105, located in Santa Barbara, CA, presents a unique opportunity for landlords and small-portfolio investors due to the disparity between the Fair Market Rent (FMR) and the market rent. For fiscal year 2024, the FMR is set at $3450, while the actual market rent, as measured by Zillow's ZORI, stands at $4225. This creates a gap of $775, which translates to approximately 22.5% below the market rate.
The implications of this gap are significant. When the FMR is lower than the market rent, it means that landlords who accept housing vouchers can expect to receive a fixed payment that is less than what they could charge in the open market. This scenario poses a challenge for landlords, as they must consider the cost of maintaining properties at a level suitable for voucher recipients while earning less than potential market rents. The cost of housing voucher tenants below open-market rates can be seen as a trade-off for guaranteed payments and lower vacancy rates.
In the context of Santa Barbara, where 47.2% of residents are renters and the median home value is $1,912,131, the median household income of $138,286 suggests a relatively affluent area. However, the FMR is still significantly lower than the market rent, indicating that there is a substantial portion of the population that relies on government assistance to afford housing. Landlords should weigh the benefits of a steady income stream against the potential drawbacks of accepting lower rents through the Section 8 program.
To summarize, the gap between the FMR and market rent in ZIP 93105 is $775, or 22.5% below market rates. This makes the decision to participate in the Section 8 program a strategic choice, balancing the advantages of a stable tenant base with the financial realities of receiving below-market rents. Given the high median home values and incomes in Santa Barbara, the program serves as a critical bridge for many residents seeking affordable housing options.
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.