Location: San Francisco, CA | Metro: San Francisco, CA HUD Metro FMR Area
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 | $2,240 |
| 1 Bedroom | $2,680 |
| 2 Bedrooms | $3,250 |
| 3 Bedrooms | $4,150 |
| 4 Bedrooms | $4,300 |
| 5 Bedrooms | $4,988 |
| 6 Bedrooms | $5,587 |
| 7 Bedrooms | $6,034 |
| 8 Bedrooms | $6,336 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $2,680 | $711,956 | 0.38% | F |
| 2BR | $3,250 | $964,486 | 0.34% | F |
| 3BR | $4,150 | $1,140,489 | 0.36% | F |
| 4BR | $4,300 | $1,266,938 | 0.34% | F |
| 5BR | $4,988 | $1,439,021 | 0.35% | F |
U.S. Census Bureau data (2024)
The economics of Section 8 in ZIP code 94134, located in San Francisco, CA, involve understanding the balance between the Safety Net Fair Market Rent (SAFMR) and the local market rent. For a two-bedroom apartment in this ZIP code, the SAFMR for FY 2024 is set at $2,870. This figure represents the maximum amount that the Section 8 program will pay toward the rent for such an apartment. However, it's important to note that this rate is specific to this ZIP code and may not reflect conditions in other areas.
The local market rent, as indicated by the Zillow Observed Rent Index (ZORI), is higher at $3,722. This means that landlords can charge more than the SAFMR for their units, but the tenant's contribution and the utility allowances must be factored into the overall payment structure.
A landlord participating in Section 8 receives a combination of the tenant's share and the government's subsidy. Typically, the tenant pays about 30% of their adjusted income toward the rent, which is calculated based on the SAFMR. In ZIP 94134, if we assume the tenant's share is 30%, they would pay approximately $861 towards a two-bedroom apartment. The remaining portion of the rent, up to the SAFMR limit, is covered by the government through the voucher program. Thus, the government would pay the difference between the tenant's share and the SAFMR, which in this case is $1,999.
Utility allowances are also part of the calculation. These allowances vary but are typically around $400-$500 per month. If a landlord includes utilities in the rent, these allowances can be added to the SAFMR to determine the total reimbursement. However, if the landlord charges separately for utilities, they do not receive this allowance.
Given the SAFMR of $2,870 and the local market rent of $3,722, there is a significant gap between the two figures. Landlords who participate in Section 8 for a two-bedroom unit in ZIP 94134 would see a reimbursement gap of $852 per month, meaning they would receive $852 less than the local market rent for this type of unit.
To summarize, landlords in ZIP 94134 who accept Section 8 vouchers for a two-bedroom apartment will receive a combined reimbursement of $2,870, which is less than the market rent of $3,722. This results in a reimbursement gap of $852 per month. While this may seem like a financial shortfall, it is important to consider the stability and reliability of the rental income, as well as the reduced risk of non-payment compared to the private market.
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.