Section 8 Fair Market Rent (FMR) for ZIP 93150 - 2027

FY 2027 Fair Market Rent Rates

To understand the economics of Section 8 in ZIP 93150, it's important to recognize that the SAFMR (Small Area Fair Market Rent) for a two-bedroom apartment is set at $2990 for the fiscal year 2024. This figure is specifically tailored for this ZIP code, meaning that the rate is set for this particular area and reflects local rental conditions.

The SAFMR serves as the benchmark for determining the maximum amount that a housing voucher can cover. However, the actual reimbursement to landlords depends on the tenant's contribution and any utility allowances. Typically, tenants are required to pay 30% of their adjusted income towards rent. If we assume an average adjusted income of $1500 per month, the tenant would contribute $450 towards rent. This leaves the remaining amount to be covered by the voucher, which would be $2540 ($2990 - $450).

Utility allowances can vary, but they generally do not exceed the SAFMR. For simplicity, let's consider a utility allowance of $200. This means that the total reimbursement to the landlord, including the utility allowance, would be $2740 ($2540 + $200).

Given that the local market rent for a two-bedroom apartment is currently unavailable, it's crucial to compare the SAFMR with prevailing market rates to determine if there's a surplus or a gap. When the market rent is lower than the SAFMR, landlords may receive more than the market value, creating a surplus. Conversely, if the market rent exceeds the SAFMR, landlords will face a reimbursement gap.

In ZIP 93150, landlords should expect a reimbursement gap or surplus based on the actual market rates. If the market rent were hypothetically $2800, landlords would receive $190 more than the market rate, indicating a surplus. On the other hand, if the market rent were $3200, landlords would receive $460 less than the market rate, representing a gap.

To accurately assess the financial impact, landlords must know the exact market rent for their properties. They should also consider the potential for higher vacancy rates or increased maintenance costs associated with Section 8 tenancy. However, the SAFMR of $2990 provides a stable and predictable income source, unlike fluctuating market rents.

Ultimately, the decision to participate in Section 8 should be made after carefully evaluating these factors and understanding the SAFMR's role in setting the maximum reimbursement. Landlords in ZIP 93150 can expect a reimbursement of around $2740 for a two-bedroom apartment when all components are factored in, leading to either a surplus or a gap depending on the local market conditions.

Data Sources: FMR data from HUD (2027).

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.