Location: Oakland-Fremont, CA | Metro: Oakland-Fremont, 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 | $2,690 |
| 1 Bedroom | $2,950 |
| 2 Bedrooms | $3,610 |
| 3 Bedrooms | $4,620 |
| 4 Bedrooms | $5,470 |
| 5 Bedrooms | $6,345 |
| 6 Bedrooms | $7,106 |
| 7 Bedrooms | $7,674 |
| 8 Bedrooms | $8,058 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $3,610 | $925,511 | 0.39% | F |
| 3BR | $4,620 | $1,247,638 | 0.37% | F |
| 4BR | $5,470 | $2,065,757 | 0.26% | F |
| 5BR | $6,345 | $2,567,584 | 0.25% | F |
U.S. Census Bureau data (2024)
A skeptical investor might question whether the Fair Market Rent (FMR) of $3,390 for ZIP 94506 (Danville, CA) in fiscal year 2024 will sufficiently cover the mortgage on a home valued at $2,084,236. According to recent data, the median property value in Danville has slightly decreased to $1,763,711, which means that the home in question is above the median value. To accurately assess if the FMR can cover the mortgage, one would need to know the exact terms of the mortgage, including interest rates and loan duration. However, given that the FMR is lower than the median home value, it's clear that relying solely on FMR may not fully cover the mortgage payments on a home priced at $2,084,236.
The investor might also be concerned about the level of renter demand in Danville, with only 11.9% of the population renting. While this percentage is relatively low, it does not necessarily indicate a lack of demand. The realtor.com data shows that Danville has a stable housing market with consistent trends. It's important to note that even with a smaller percentage of renters, the actual number of potential tenants can still be significant due to the town's overall population size. Therefore, while the demand may not be as high as in other areas, it remains sufficient for a landlord or small-portfolio investor.
A final objection could be whether Section 8 vouchers will keep pace with the market rents, which are reported to be around $5,148. The data from HUD houses in Danville indicates that the voucher program exists but does not specify the amount of the vouchers. Given that the FMR is significantly lower than the market rent, landlords who accept Section 8 vouchers should expect that the vouchers may not cover the full market rent. This gap could be managed through a combination of rent supplements from the tenant and possibly adjusting the rent expectations to align more closely with the FMR.
In summary, while the FMR may not fully cover the mortgage on a home valued at $2,084,236, the rental market in Danville, CA, remains stable and there is a sufficient number of renters. However, landlords should be prepared for Section 8 vouchers to fall short of covering market rents, necessitating adjustments in their business models.
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.