Location: San Luis Obispo-Paso Robles, CA | Metro: San Luis Obispo-Paso Robles, 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 | $1,860 |
| 1 Bedroom | $2,040 |
| 2 Bedrooms | $2,670 |
| 3 Bedrooms | $3,570 |
| 4 Bedrooms | $4,130 |
| 5 Bedrooms | $4,791 |
| 6 Bedrooms | $5,366 |
| 7 Bedrooms | $5,795 |
| 8 Bedrooms | $6,085 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,670 | $633,006 | 0.42% | F |
| 3BR | $3,570 | $773,590 | 0.46% | F |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP 93453 (Creston, CA) provides a useful benchmark for landlords and small-portfolio investors considering properties in this area. To begin, we must annualize the Fair Market Rent (FMR) for a 2-bedroom unit, which is set at $2310 for fiscal year 2024. This figure represents the maximum monthly rental assistance that can be provided to tenants under the Section 8 program.
Given the median home value in Creston, CA is $767,841, the implied gross yield when using the FMR can be calculated. The gross yield is the annual rental income divided by the property value. In this case, the annualized FMR for a 2BR unit would be $2310 multiplied by 12, equating to $27,720. Dividing this by the median home value gives us an implied gross yield of approximately 3.6%. This calculation assumes that the entire home is rented out at the FMR rate, which may not always reflect reality due to differences in property size and type.
However, the market rent for the area is listed as N/A, which complicates the direct comparison. If market rents were available, they would provide a clearer picture of what landlords could potentially charge above the FMR. Since market rent data is not available, it's difficult to state a precise gross yield for market rents. Nonetheless, it's reasonable to infer that market rents would typically exceed the FMR, leading to a higher gross yield than the 3.6% derived from the FMR.
Considering the renter density in Creston, CA stands at 39.2%, this indicates a significant portion of the population relies on rental housing. However, the lack of data on the Days on Market (DOM) makes it challenging to assess the speed at which properties can be leased. A low DOM would suggest strong demand, potentially supporting higher rents and thus a better gross yield for landlords.
In summary, the Section 8 scenario implies a gross yield of about 3.6% based on the FMR. While the market rent scenario would likely offer a higher gross yield, the exact figure cannot be determined without specific market rent data. For investors, the 3.6% gross yield serves as a baseline, with the potential for improvement if market conditions support higher 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.