Section 8 Fair Market Rent (FMR) for ZIP 95322 - 2027

Location: Modesto, CA | Metro: Merced, CA MSA

Investment Score for ZIP 95322

Monthly Rent (2BR)

$1,590

Median Price (2BR)

$315,279

1% Rule

0.5%

Annual Yield

6.05%

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,180
1 Bedroom	$1,240
2 Bedrooms	$1,590
3 Bedrooms	$2,200
4 Bedrooms	$2,550
5 Bedrooms	$2,958
6 Bedrooms	$3,313
7 Bedrooms	$3,578
8 Bedrooms	$3,757

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,590	$315,279	0.5%	F
3BR	$2,200	$402,442	0.55%	F
4BR	$2,550	$478,195	0.53%	F
5BR	$2,958	$629,689	0.47%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

Population

9,506

Median Household Income

$65,761

Housing Units

3,985

Renter Percentage

45.3%

Occupancy Rate

90.4%

Renter Occupied

1,632

To decide whether to buy in ZIP 95322 (Gustine, CA) for Section 8 investment, follow these steps:

Step 1: Can FMR ($1370) cover debt service on a $422,077 property?

No: The Fair Market Rent (FMR) of $1370 is unlikely to cover the debt service on a property priced at $422,077. Debt service typically includes mortgage payments, property taxes, insurance, and maintenance costs. At this price point, the monthly mortgage payment alone would be significantly higher than the FMR, making it challenging to break even without additional subsidies.

Step 2: Is the market rent of $1,321 (Census ACS) above, at, or below the FMR?

Below FMR: The market rent of $1,321 is slightly below the FMR of $1370. This indicates that the rental market is not strong enough to support rents at the FMR level, which could limit the profitability of Section 8 properties in this area.

Step 3: Is there sufficient demand with 45.3% renters and N/A-day days on the market (DOM)?

It Depends: With 45.3% of the population renting, there is a notable portion of the market that could potentially benefit from Section 8 housing. However, the lack of data on days on the market (DOM) makes it difficult to assess the speed at which rental properties are occupied. If you can secure a lower-priced property where the FMR can cover debt service, the high percentage of renters might justify the investment despite the weak market rent. Otherwise, the combination of low market rent and uncertain occupancy rates suggests caution.

In summary, purchasing in ZIP 95322 for Section 8 purposes is not advisable if the target property costs $422,077 due to the FMR being insufficient to cover debt service. The market rent being below the FMR further diminishes potential profitability. While the high percentage of renters indicates some demand, the missing DOM data leaves too many unknowns regarding occupancy rates. Therefore, unless you can find a more affordable property or additional sources of income, investing in Gustine for Section 8 should be reconsidered.

Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-08-31). 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.