Location: Vallejo, CA | Metro: Vallejo, 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 | $2,250 |
| 1 Bedroom | $2,480 |
| 2 Bedrooms | $3,090 |
| 3 Bedrooms | $4,030 |
| 4 Bedrooms | $4,600 |
| 5 Bedrooms | $5,336 |
| 6 Bedrooms | $5,976 |
| 7 Bedrooms | $6,454 |
| 8 Bedrooms | $6,777 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $4,030 | $677,501 | 0.59% | F |
| 4BR | $4,600 | $726,620 | 0.63% | D |
U.S. Census Bureau data (2024)
The analysis for ZIP code 94592 reveals a nuanced picture regarding the potential returns for landlords and small-portfolio investors participating in the Section 8 housing program. Using the Fair Market Rent (FMR) for a two-bedroom apartment at $3460 annually (for FY 2024), the implied gross yield can be calculated against the median home value of $721,275.
To determine the gross yield, we first annualize the FMR. At $3460 per year, the gross yield would be approximately 0.48%. This calculation is derived by dividing the annual rental income by the median home value: $3460 / $721,275 = 0.0048 or 0.48%. This figure represents the potential return if the property were rented exclusively under the Section 8 program at the FMR rate.
In contrast, using the market rent figure of $1,737 (from Census ACS), the annualized market rent would be $20,844. The implied gross yield here is about 2.9%, calculated as follows: $20,844 / $721,275 = 0.029 or 2.9%. This higher yield reflects the potential return if the property were rented at prevailing market rates.
The significant difference between these two yields highlights the trade-offs landlords must consider when deciding whether to participate in the Section 8 program. Given that only 19.2% of residents in ZIP 94592 are renters, it's important to recognize the limitations this places on the availability of tenants eligible for Section 8.
The gross yield of 0.48% from the FMR scenario is considerably lower than the market rent yield of 2.9%. However, the reality of the situation in ZIP 94592 suggests that the 0.48% yield is more reflective of the actual potential returns due to the low renter density and the fact that the days-on-market (DOM) data is not available. This implies that finding a tenant who qualifies for Section 8 might be challenging, thus making the FMR-based yield more realistic.
Investors should carefully weigh these figures against their own financial goals and the specific dynamics of the local real estate market. While the market rent scenario offers a much higher gross yield, the practicalities of securing a Section 8 tenant in ZIP 94592 point towards a more modest return.
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.