Section 8 Fair Market Rent (FMR) for ZIP 94604 - 2027

FY 2027 Fair Market Rent Rates

To understand how Section 8 economics work in ZIP 94604, it's essential to know the specifics of the program and how they apply to this particular area. The SAFMR (Section 8 Area Median Rent) for a two-bedroom apartment in ZIP 94604 for fiscal year 2024 is set at $2590. This figure represents the maximum amount that the housing authority will pay toward rent for a two-bedroom unit in this ZIP code.

The local market rent for a two-bedroom apartment in ZIP 94604 is currently not available, which means landlords must rely on the SAFMR as their benchmark for setting rental rates under the Section 8 program. However, it's important to note that the SAFMR is specifically tailored for this ZIP code and does not represent the average market rent across the entire county or metropolitan area.

A landlord participating in the Section 8 program receives payment based on a voucher, which covers most of the rent but not all. The tenant is responsible for paying a portion of the rent, typically around 30% of their income. Additionally, there are utility allowances that can vary based on the size of the apartment and the location. For ZIP 94604, the total reimbursement a landlord might receive includes the tenant's contribution and any applicable utility allowance.

If we assume a standard utility allowance and a typical tenant contribution, the actual amount a landlord would receive from a Section 8 voucher for a two-bedroom apartment could be slightly less than the SAFMR. For instance, if the utility allowance is $200 and the tenant contributes $300 towards the rent, the total reimbursement would be $2590 - $300 (tenant contribution) + $200 (utility allowance) = $2490.

This calculation leaves a potential reimbursement gap or surplus depending on the actual market conditions and the landlord's set rent. If the market rent exceeds the SAFMR, landlords may find themselves with a reimbursement gap, meaning they receive less than they charge tenants. Conversely, if the market rent is below the SAFMR, landlords might have a surplus where the voucher covers more than the market rate.

In ZIP 94604, due to the lack of specific local market rent data, it's difficult to provide an exact surplus or gap figure. However, if the market rent aligns closely with the SAFMR, landlords can expect to receive approximately $2490 per month for a two-bedroom unit, leading to a minor surplus when compared to the SAFMR. Landlords should monitor local market trends to adjust their expectations accordingly.

Data Sources: FMR data from HUD (2027).

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.