Location: Bakersfield-Delano, CA | Metro: Bakersfield-Delano, 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 | $1,400 |
| 1 Bedroom | $1,410 |
| 2 Bedrooms | $1,830 |
| 3 Bedrooms | $2,530 |
| 4 Bedrooms | $3,060 |
| 5 Bedrooms | $3,550 |
| 6 Bedrooms | $3,976 |
| 7 Bedrooms | $4,294 |
| 8 Bedrooms | $4,509 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,830 | $255,794 | 0.72% | D |
| 3BR | $2,530 | $367,323 | 0.69% | D |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 93518 (Caliente, CA) reveals interesting insights into potential investment opportunities. For a two-bedroom unit, the Fair Market Rent (FMR) set by HUD for FY 2024 is $1,030 per month. This translates to an annual rental income of $12,360. Given the median home value in the area is $313,310, the implied gross yield based on the FMR would be approximately 3.95%. The calculation is straightforward: divide the annual rental income by the property value.
In contrast, the market rent for a two-bedroom unit in Caliente, CA, as reported by the Census ACS, stands at $1,392 per month. This yields an annual rental income of $16,704, resulting in a higher gross yield of about 5.33%. This figure is derived similarly by dividing the annual rental income by the median home value.
The gross yield comparison between the FMR and market rent scenarios highlights a significant difference, with the market rent scenario offering a notably better return. However, it's important to consider the local renter density, which is only 6.7% in this case. This low density suggests that the demand for rental properties, particularly those participating in the Section 8 program, might be limited. As such, the FMR-based gross yield of 3.95% is more reflective of the reality faced by landlords in ZIP 93518.
The N/A-day Days on Market (DOM) indicates incomplete data, which could imply that there are either very few transactions or the data collection process is inconsistent. This lack of recent transactional data makes it challenging to predict how quickly a property can be leased out, especially under the Section 8 program.
In conclusion, while the market rent scenario offers a more attractive gross yield of 5.33%, the actual performance for landlords in ZIP 93518 is likely closer to the FMR-based gross yield of 3.95%, considering the low renter density and the uncertainty around the leasing speed due to incomplete DOM data. Investors should factor these realities into their decision-making process when evaluating Section 8 investments in this area.
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.