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 | $2,380 |
| 1 Bedroom | $2,610 |
| 2 Bedrooms | $2,980 |
| 3 Bedrooms | $3,840 |
| 4 Bedrooms | $4,380 |
| 5 Bedrooms | $5,081 |
| 6 Bedrooms | $5,691 |
| 7 Bedrooms | $6,146 |
| 8 Bedrooms | $6,453 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $3,840 | $884,244 | 0.43% | F |
| 4BR | $4,380 | $979,469 | 0.45% | F |
U.S. Census Bureau data (2024)
The ZIP code 93440 presents several challenges for landlords considering participation in the Section 8 program. Tenant turnover is a significant concern, with the market rent at $2,882 being notably higher than the Fair Market Rent (FMR) of $2,410 for FY 2024. This discrepancy can lead to frequent changes in occupancy, as tenants who qualify for Section 8 may struggle to meet the market rates once their initial lease period ends. Additionally, the vacancy exposure is heightened due to the lack of data on days on market (DOM), which makes it difficult to predict how long a property might remain unoccupied between tenants. The deferred maintenance exposure is another issue, given that the typical home value in the area is $920,978 while the median income stands at $79,167. These figures suggest that residents may have limited financial resources to cover unexpected repairs or maintenance, potentially leading to higher costs for landlords.
However, these risks must be weighed against the high concentration of renters in the area, with 25.5% of the population being renters. High renter density often translates into a robust demand for housing vouchers, which can stabilize occupancy rates and provide a steady stream of rental income. The presence of a substantial number of voucher holders can mitigate some of the risks associated with tenant turnover and vacancy periods, as these individuals are more likely to secure and maintain housing through the Section 8 program.
In conclusion, despite the potential challenges, the high renter share in ZIP 93440 suggests a moderate risk level for a first-time Section 8 landlord.
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.