Location: San Benito County, CA | Metro: Salinas, 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 | $2,420 |
| 1 Bedroom | $2,510 |
| 2 Bedrooms | $3,140 |
| 3 Bedrooms | $4,220 |
| 4 Bedrooms | $4,570 |
| 5 Bedrooms | $5,301 |
| 6 Bedrooms | $5,937 |
| 7 Bedrooms | $6,412 |
| 8 Bedrooms | $6,733 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $3,140 | $802,863 | 0.39% | F |
| 3BR | $4,220 | $973,305 | 0.43% | F |
| 4BR | $4,570 | $1,193,137 | 0.38% | F |
U.S. Census Bureau data (2024)
The Section 8 cap-rate picture for ZIP 95004 (Aromas, CA) reveals a challenging investment scenario for landlords and small-portfolio investors. With an annualized Fair Market Rent (FMR) for a 2-bedroom unit at $2620 for FY 2024 and the market rent at $2,659 according to the Census ACS, we can calculate the implied gross yields against the median home value of $967,143.
First, let's consider the FMR scenario. The annual rent of $2620 implies a gross yield of approximately 0.27%. This is calculated by dividing the annual rent by the median home value ($2620 / $967,143 = 0.0027 or 0.27%). For the market rent scenario, using the $2,659 figure, the gross yield slightly improves to about 0.28% ($2659 / $967,143 = 0.0028 or 0.28%).
Given these gross yields, it is evident that the returns on investment are extremely low. The implied gross yields suggest that properties in Aromas, CA, would generate only a small fraction of their value annually in rental income, whether under Section 8 or at market rates.
The 25.5% renter density indicates that a significant portion of the population does not rent, which could affect the demand for rental units, including those offered through Section 8. However, the N/A-day Days on Market (DOM) suggests that there might be a lack of recent sales data to provide an accurate measure of how quickly properties are being rented out. This absence of DOM data makes it difficult to assess the speed at which rental properties are occupied, which is a critical factor for cash flow and investment timing.
In conclusion, based on the available data, the market rent scenario offers a marginally better gross yield compared to the FMR under Section 8. However, both scenarios present a challenging environment for landlords and investors due to the exceedingly low gross yields. The actual performance would depend on the specific property, its location within the ZIP code, and the overall local economic conditions.
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.