Section 8 Fair Market Rent (FMR) for ZIP 95403 - 2027

Investment Score for ZIP 95403

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	$2,090
1 Bedroom	$2,280
2 Bedrooms	$2,980
3 Bedrooms	$4,130
4 Bedrooms	$4,540
5 Bedrooms	$5,266
6 Bedrooms	$5,898
7 Bedrooms	$6,370
8 Bedrooms	$6,689

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	$2,980	$448,019	0.67%	D
3BR	$4,130	$709,581	0.58%	F
4BR	$4,540	$828,777	0.55%	F
5BR	$5,266	$1,197,355	0.44%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 95403 (Santa Rosa, CA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 95403 is set by HUD for 2026. The FMRs for different unit sizes are as follows: - 0BR: $2010 - 1BR: $2220 - 2BR: $2910 - 3BR: $4000 - 4BR: $4270 These figures represent the maximum amount that a Section 8 voucher holder can pay towards rent. However, it is important to note that these FMRs are significantly lower than the actual market rents. For instance, the Zillow median price for a 2BR unit is $453,444, which translates to a monthly mortgage payment far exceeding the FMR. The price-to-FMR ratio for a 2BR unit is 13.0x, indicating that the actual market rent is much higher than the FMR. This creates significant constraints for voucher holders. They will find it challenging to secure housing that meets their needs within the FMR limits, especially for larger units like 2BR, 3BR, and 4BR. The disparity between FMR and market rent means that voucher holders often have limited options and may struggle to find landlords willing to accept vouchers due to the low rent ceilings. #### Affordability & Renter Profile ZIP code 95403 has a population of 45,806, with 45.2% of residents being renters. This indicates a substantial rental market. The occupancy rate stands at 94.3%, suggesting a relatively tight market where demand is high and supply is somewhat constrained. Given the median household income of $98,191, the affordability of renting a 2BR unit at the FMR ($2910) is quite manageable, as it represents only 35.6% of the median income. However, this is still a significant portion of the income, especially when considering other living expenses. The high proportion of renters and the tight occupancy rate suggest that competition for rental properties is fierce, and many residents may be facing financial stress to afford housing. #### Investor Angle From an investor perspective, the ZIP code 95403 presents a mixed picture. While the overall market appears to be robust with high occupancy rates and strong demand, the alignment with Section 8 vouchers is less favorable. The FMRs are substantially below the market rents, making it difficult to achieve positive cash flow on properties rented through Section 8. For example, a 2BR unit with a Zillow median price of $453,444 would likely have a monthly mortgage payment well above $2910, even without factoring in property taxes, insurance, and maintenance costs. Therefore, properties rented under Section 8 would likely result in negative cash flow for investors. The investment grade for this ZIP code, particularly for Section 8-focused investments, is low due to the mismatch between FMR and market rents. Investors should carefully consider the financial implications before entering this market with a Section 8 strategy. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors might consider focusing on smaller units such as 0BR and 1BR apartments. These units have FMRs of $2010 and $2220 respectively, which are lower but still represent a significant portion of the median income. Although cash flow might still be negative, the gap between FMR and market rent is smaller, potentially reducing the financial burden. 2. **Consider Alternative Rental Programs**: Instead of relying solely on Section 8 vouchers, investors could explore alternative rental programs that offer higher subsidy levels or private market rentals. This could include looking into other government assistance programs or targeting tenants who do not require vouchers but still benefit from affordable housing options. 3. **Evaluate Long-Term Appreciation Potential**: Despite the challenges with cash flow, investors should evaluate the long-term appreciation potential of properties in ZIP code 95403. With a strong rental market and high occupancy rates, there is a possibility that property values will continue to rise, providing capital gains opportunities. #### Bottom Line For Section 8-focused investors, the recommendation is to **skip** this ZIP code. The high price-to-FMR ratio and the tight rental market make it difficult to achieve positive cash flow. Additionally, the mismatch between FMR and actual market rents poses significant challenges for voucher holders and landlords alike. Investors seeking to enter the Santa Rosa rental market should consider alternative strategies that align better with the local economic conditions and rental dynamics.

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.