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 | $2,860 |
| 1 Bedroom | $3,340 |
| 2 Bedrooms | $4,110 |
| 3 Bedrooms | $5,370 |
| 4 Bedrooms | $6,050 |
| 5 Bedrooms | $7,018 |
| 6 Bedrooms | $7,860 |
| 7 Bedrooms | $8,489 |
| 8 Bedrooms | $8,913 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $3,340 | $773,907 | 0.43% | F |
| 2BR | $4,110 | $1,433,114 | 0.29% | F |
| 3BR | $5,370 | $2,010,580 | 0.27% | F |
| 4BR | $6,050 | $2,795,605 | 0.22% | F |
| 5BR | $7,018 | $3,683,430 | 0.19% | F |
U.S. Census Bureau data (2024)
ZIP 94941, located in Mill Valley, CA, is an ideal cash-flow anchor for a Section 8 portfolio strategy. The Fair Market Rent (FMR) for the San Francisco, CA HUD Metro FMR Area in fiscal year 2024 is set at $3740, while the market average rent stands at $3775. This minimal spread of just $35 indicates that properties in this ZIP code will not face significant challenges in attracting tenants who qualify for Section 8 assistance.
The median home value in ZIP 94941 is exceptionally high at $2,077,345, reflecting the affluent nature of the area. Despite this, the median income of $209,870 suggests that many residents still rely on rental properties, making it a stable market for Section 8 units. Landlords can expect steady cash flow from these properties, as the income levels support a strong demand for affordable housing options.
A cash-flow anchor is crucial for any investment portfolio, providing consistent income regardless of market fluctuations. In ZIP 94941, the slight premium in market rents over FMR ensures that landlords can cover their expenses and generate reliable returns. Additionally, the low price-cut share of 0.1% and a relatively quick time to sell, with a 12-day Days on Market (DOM), indicate that the real estate market is robust and liquid, further supporting the stability of cash flows from Section 8 properties.
While ZIP 94941 could also serve as an appreciation play due to its high median home value and low DOM, the primary focus should be on its role as a cash-flow anchor. The diversifier aspect is less compelling here, given the high median income and the fact that only 31.8% of the population are renters. This means that the majority of residents own their homes, reducing the overall risk but also limiting the potential for broad diversification within the rental market.
In summary, ZIP 94941 excels as a cash-flow anchor within a Section 8 portfolio strategy, thanks to its minimal gap between FMR and market rents, along with the financial stability provided by high median incomes and home values. This makes it a secure choice for generating predictable income streams for landlords and small-portfolio investors.
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.