Section 8 Fair Market Rent (FMR) for ZIP 95835 - 2027

Investment Score for ZIP 95835

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	$2,140
1 Bedroom	$2,200
2 Bedrooms	$2,700
3 Bedrooms	$3,540
4 Bedrooms	$4,080
5 Bedrooms	$4,733
6 Bedrooms	$5,301
7 Bedrooms	$5,725
8 Bedrooms	$6,011

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$2,200	$288,398	0.76%	D
2BR	$2,700	$417,505	0.65%	D
3BR	$3,540	$518,374	0.68%	D
4BR	$4,080	$619,430	0.66%	D
5BR	$4,733	$693,452	0.68%	D

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 95835 (Sacramento, CA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) figures for ZIP code 95835, as of 2026, indicate that the rent for a two-bedroom unit is set at $2840 per month. This figure represents 29.8% of the median household income in the area, which is $114,468. However, the actual rental market in 95835 is significantly higher. The Zillow median price for a two-bedroom home is $424,259, which translates into a monthly rent of approximately $3,535 based on typical mortgage calculations (assuming a 5% interest rate and a 20% down payment). This means that the actual rent for a two-bedroom unit is about 12.4 times the FMR, making it extremely challenging for Section 8 voucher holders to find suitable housing within their budget. Given these dynamics, voucher holders face significant constraints. They must either settle for smaller units, such as one-bedroom apartments, or seek out properties outside the ZIP code where rents might be lower. The high disparity between FMR and actual rents suggests that there is a limited supply of affordable housing options for those relying on vouchers. #### Affordability & Renter Profile ZIP code 95835 has a population of 42,004, with 30.1% of residents being renters. The occupancy rate stands at 94.7%, indicating a relatively tight rental market. With a median household income of $114,468, the area is considered affluent compared to many other parts of Sacramento County. However, the high price-to-FMR ratio of 12.4x suggests that even for those who can afford market-rate rents, the cost of living is quite high. The renter profile in 95835 is likely diverse but skewed towards individuals and families who can afford higher rents. Given the high cost of living, it is probable that many renters are employed in high-paying jobs or have access to additional financial resources. For those relying solely on Section 8 vouchers, finding affordable housing is a significant challenge due to the limited number of units available within the voucher limits. #### Investor Angle From an investor perspective, the ZIP code 95835 presents a mixed picture. While the actual rents are high, the FMRs set by HUD are much lower. A two-bedroom unit renting at the FMR of $2840 would generate a monthly cash flow of around $705 if rented at the Zillow median price of $3,535. This indicates that investors could potentially achieve positive cash flow by renting to voucher holders, though they would need to be prepared for the lower rent ceiling. However, the investment grade in this ZIP code is likely to be moderate to low for Section 8-focused investors. The high price-to-FMR ratio means that landlords would need to be selective about the properties they choose to invest in, ensuring that they are priced appropriately for both market-rate and voucher tenants. Additionally, the limited number of voucher-eligible units and the competition from market-rate rents could make it difficult to consistently fill units with Section 8 tenants. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Investors should consider focusing on one-bedroom or studio units, which are more likely to fall within the FMR limits. For example, the FMR for a one-bedroom unit is $2310, while the actual rent is likely to be around $3,000 based on the price-to-FMR ratio. This could provide a better chance of attracting Section 8 tenants and maintaining positive cash flow. 2. **Target Affordable Neighborhoods Within the ZIP Code**: Not all areas within 95835 will have the same rental rates. Investors should look for neighborhoods where the average rent is closer to the FMR. This might involve researching local real estate listings or consulting with local brokers to identify pockets of affordability. #### Bottom Line For Section 8-focused investors, the recommendation for ZIP code 95835 is to **Skip**. The high disparity between FMR and actual rents makes it challenging to find properties that are both affordable and profitable. While there might be some opportunities in smaller units or more affordable neighborhoods, the overall market conditions suggest that the risk and effort outweigh the potential rewards. Investors looking for more favorable conditions might want to explore other ZIP codes within Sacramento County where the price-to-FMR ratio is lower and the availability of affordable units is higher.

Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.