Location: Sacramento--Roseville--Arden-Arcade, CA | Metro: Sacramento--Roseville--Arden-Arcade, CA HUD Metro FMR Area
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 | $1,860 |
| 1 Bedroom | $1,950 |
| 2 Bedrooms | $2,400 |
| 3 Bedrooms | $3,190 |
| 4 Bedrooms | $3,680 |
| 5 Bedrooms | $4,269 |
| 6 Bedrooms | $4,781 |
| 7 Bedrooms | $5,163 |
| 8 Bedrooms | $5,421 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,400 | $408,034 | 0.59% | F |
| 3BR | $3,190 | $512,756 | 0.62% | D |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP 95635 (Greenwood, CA) provides insight into the potential returns for landlords and small-portfolio investors. The Fair Market Rent (FMR) for a two-bedroom apartment in Greenwood, CA, for fiscal year 2024 is set at an annualized rate of $2720. Given the median home value in the area is $482,182, we can calculate the implied gross yield based on these figures.
To derive the gross yield, we divide the annual rental income by the property's value. In this case, the gross yield using the FMR would be calculated as follows:
$2720 / $482,182 = 0.00564, or approximately 0.56%.
This figure represents the minimum guaranteed income landlords could receive through the Section 8 program. However, it's important to note that this scenario is highly unlikely due to the low rental income relative to the median home value. Landlords typically seek higher yields, and the FMR does not reflect market conditions accurately.
The market rent for ZIP 95635 is listed as N/A, indicating that there isn't sufficient data to determine a reliable market rent figure. This makes it difficult to provide a precise gross yield for the market rent scenario. However, considering the 7.0% renter density and the N/A-day Days on Market (DOM), it's evident that the rental market is not robust enough to support high market rents.
Given the limited data on market rents and the low density of renters, the FMR-based gross yield, while very conservative, serves as a baseline. For a more accurate assessment, investors should look into local rental listings to find comparable market rates. Until such data is available, the FMR-based yield remains the most reliable metric for understanding the lower bound of potential returns.
In conclusion, the FMR-based gross yield of approximately 0.56% is a conservative estimate, but without specific market rent figures, it's the best indicator we have. Investors should use this as a starting point and consider the actual market conditions when making investment decisions.
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.