Location: Modesto, CA | Metro: Modesto, 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 | $1,370 |
| 1 Bedroom | $1,480 |
| 2 Bedrooms | $1,940 |
| 3 Bedrooms | $2,590 |
| 4 Bedrooms | $3,040 |
| 5 Bedrooms | $3,526 |
| 6 Bedrooms | $3,949 |
| 7 Bedrooms | $4,265 |
| 8 Bedrooms | $4,478 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,940 | $372,920 | 0.52% | F |
| 3BR | $2,590 | $457,623 | 0.57% | F |
| 4BR | $3,040 | $517,568 | 0.59% | F |
| 5BR | $3,526 | $576,504 | 0.61% | D |
U.S. Census Bureau data (2024)
In Patterson, CA (ZIP 95363), there are several risks that a landlord should consider when investing in properties under the Section 8 program. Firstly, tenant turnover is a significant concern. The market rent for the area is $2,597, while the Fair Market Rent (FMR) for FY 2024 is set at $1,870. This discrepancy can lead to higher tenant turnover rates, as tenants may struggle to afford the difference between the FMR and the market rent.
Vacancy exposure is another critical issue. With an average Days on Market (DOM) of 49 days, landlords face a period where their property may remain unoccupied, leading to lost rental income. Additionally, the deferred maintenance exposure is noteworthy. Given the typical home value of $510,427 and a median income of $95,679, many homeowners might delay necessary repairs due to financial constraints, which could translate into higher maintenance costs for landlords.
However, these risks must be weighed against the high renter share in Patterson, which stands at 30.3%. A larger percentage of renters typically indicates a higher demand for housing vouchers, such as Section 8. This increased demand can help mitigate some of the risks associated with tenant turnover and vacancy exposure, as there will likely be a steady pool of potential tenants who qualify for the program.
Verdict: Moderate risk for a first-time Section 8 landlord.
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.