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 | $2,110 |
| 1 Bedroom | $2,310 |
| 2 Bedrooms | $2,830 |
| 3 Bedrooms | $3,620 |
| 4 Bedrooms | $4,290 |
| 5 Bedrooms | $4,976 |
| 6 Bedrooms | $5,573 |
| 7 Bedrooms | $6,019 |
| 8 Bedrooms | $6,320 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $2,310 | $694,814 | 0.33% | F |
| 2BR | $2,830 | $1,204,710 | 0.23% | F |
| 3BR | $3,620 | $1,897,765 | 0.19% | F |
| 4BR | $4,290 | $2,406,342 | 0.18% | F |
| 5BR | $4,976 | $2,988,393 | 0.17% | F |
U.S. Census Bureau data (2024)
The ZIP code 94705, located in Berkeley, California, presents an interesting scenario when analyzed from the renter's perspective. The median household income in this area stands at $167,970, which is notably high. However, the market rate for rent, measured by the Zillow Observed Rent Index (ZORI), is $3,133 per month. This figure represents the actual rent being charged in the market.
In comparison, the Fair Market Rent (FMR) for the fiscal year 2024 is set at $2,610. This amount is what housing authorities use to determine the maximum rent that families receiving housing vouchers can be required to pay. It's important to note that the FMR is lower than the ZORI, indicating a discrepancy between the market rate and the subsidized rent.
With 40.6% of the population renting and a total population of 13,991, there is a significant demand for rental properties in ZIP 94705. However, the affordability gap between the market rate ($3,133) and the FMR ($2,610) means that landlords might face competition when setting rents higher than the FMR. While households earning the median income can afford the market rate, those relying on housing vouchers will likely seek properties where the rent aligns with or is below the FMR.
For landlords considering their strategy, the key takeaway is to understand the balance between accepting voucher payments and setting cash-pay rents. Accepting vouchers can secure steady, government-backed rental income, albeit at a rate lower than the market. On the other hand, setting higher rents may attract tenants who can afford the ZORI but will limit the pool of potential renters to those without vouchers. Landlords should also consider the administrative ease and long-term stability that come with voucher payments versus the higher immediate returns from cash-paying tenants.
In conclusion, landlords in ZIP 94705 must weigh the benefits of voucher programs against the possibility of higher rents from cash-paying tenants. Given the high median income, there is a segment of the market that can afford higher rents, but the substantial number of renters and the affordability gap suggest that voucher acceptance can be a strategic advantage in a competitive 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.