Location: Salinas, CA | Metro: Salinas, 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 | $1,970 |
| 1 Bedroom | $2,020 |
| 2 Bedrooms | $2,430 |
| 3 Bedrooms | $3,270 |
| 4 Bedrooms | $3,560 |
| 5 Bedrooms | $4,130 |
| 6 Bedrooms | $4,626 |
| 7 Bedrooms | $4,996 |
| 8 Bedrooms | $5,246 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,430 | $496,264 | 0.49% | F |
| 3BR | $3,270 | $606,707 | 0.54% | F |
| 4BR | $3,560 | $662,424 | 0.54% | F |
| 5BR | $4,130 | $749,867 | 0.55% | F |
U.S. Census Bureau data (2024)
The Section 8 program's impact in ZIP code 93960, centered around Soledad, CA, highlights a significant financial opportunity for landlords and small-portfolio investors. The Fair Market Rent (FMR) for the area in fiscal year 2024 is set at $2410, while the Census ACS data indicates an average market rent of $1631. This creates a gap of $779, or approximately 47.7%, between the two figures.
Given that the FMR exceeds the market rent, properties participating in the Section 8 program can generate higher yields compared to those rented at open-market rates. For instance, a landlord could potentially receive $2410 per month for a property that would otherwise fetch only $1631, significantly boosting rental income. In Soledad, where 43.7% of residents are renters and the median household income stands at $96,049, the demand for affordable housing is evident. Despite the median home value being $631,369, the majority of residents still rely on rental housing, making the Section 8 program particularly relevant.
The higher FMR also means that voucher holders can afford to live in better-quality units than they might be able to without assistance. This can lead to a more stable tenant base, as voucher holders typically have their rent subsidized, reducing the risk of non-payment. Moreover, the program provides landlords with a guaranteed source of income, which can be crucial in maintaining cash flow and investment returns.
However, landlords must consider the administrative aspects of participating in the Section 8 program. While the financial benefits are clear, there may be additional paperwork and regulatory compliance required. Additionally, landlords need to ensure that their properties meet certain standards to qualify for the program, which might involve some upfront costs or maintenance work.
In conclusion, the gap between the FMR and the market rent in Soledad presents a compelling yield play for landlords willing to participate in the Section 8 program. With a substantial difference of $779 per month, or 47.7%, landlords can significantly increase their rental income while providing affordable housing options to a large portion of the local population.
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.