Location: Lake County, CA | Metro: Napa, 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 | $2,060 |
| 1 Bedroom | $2,280 |
| 2 Bedrooms | $2,990 |
| 3 Bedrooms | $3,800 |
| 4 Bedrooms | $4,450 |
| 5 Bedrooms | $5,162 |
| 6 Bedrooms | $5,781 |
| 7 Bedrooms | $6,243 |
| 8 Bedrooms | $6,555 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $2,280 | $187,661 | 1.21% | A |
| 2BR | $2,990 | $253,025 | 1.18% | B |
| 3BR | $3,800 | $403,743 | 0.94% | C |
U.S. Census Bureau data (2024)
The economics of Section 8 housing in ZIP 95461, which includes Middletown, California, in Lake County, can be quite straightforward when analyzed correctly. The SAFMR (Small Area Fair Market Rent) for a two-bedroom apartment in this specific ZIP code for FY 2024 is set at $2,580. This figure is crucial as it represents the maximum amount that the housing authority will pay towards the rent of a two-bedroom unit under the Section 8 program.
Local market rents, according to the Census ACS data, run at $2,107 for a similar two-bedroom apartment. This indicates that the SAFMR is higher than the average local market rent, which can be beneficial for landlords willing to participate in the Section 8 program.
A voucher payment under Section 8 is structured to cover most of the rent but requires the tenant to contribute a portion of their income towards the cost. Typically, the tenant's contribution is around 30% of their adjusted monthly income. If we assume an average adjusted monthly income for a tenant in this area is $1,500, then the tenant would contribute approximately $450 towards the rent.
In addition to the base rent, the housing authority also provides utility allowances. For ZIP 95461, these allowances can vary but generally cover a significant portion of the utilities. Let's say the utility allowance is around $200. This brings the total reimbursement a landlord can expect from the housing authority and the tenant to about $2,780 ($2,580 + $450 + $200).
Given that the local market rent is $2,107, a landlord participating in the Section 8 program for a two-bedroom unit in ZIP 95461 could potentially see a surplus over the market rate. In this case, the typical surplus for a landlord would be around $593 per month ($2,780 - $2,107), assuming they charge the local market rate and receive the full SAFMR plus tenant contribution and utility allowances.
This surplus can be particularly appealing for landlords who might otherwise struggle to find tenants willing to pay the market rate or who are looking for stable rental income. However, it's important to note that the actual surplus or gap can vary based on the specific circumstances of the tenant and the rental agreement.
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.