Location: Chico, CA | Metro: Chico, 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 | $1,040 |
| 1 Bedroom | $1,150 |
| 2 Bedrooms | $1,470 |
| 3 Bedrooms | $2,040 |
| 4 Bedrooms | $2,460 |
| 5 Bedrooms | $2,854 |
| 6 Bedrooms | $3,196 |
| 7 Bedrooms | $3,452 |
| 8 Bedrooms | $3,625 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,470 | $232,889 | 0.63% | D |
| 3BR | $2,040 | $285,566 | 0.71% | D |
U.S. Census Bureau data (2024)
ZIP 95916, located in Berry Creek, CA, within the Chico, CA MSA metro area, serves as an ideal cash-flow anchor for a Section 8 portfolio strategy. The Federal Market Rent (FMR) for a one-bedroom unit in this ZIP code for fiscal year 2024 is set at $1120, while the market rent stands at $1,242. This indicates a favorable spread of $122 per month above the FMR, ensuring that landlords can generate positive cash flow from their properties without the need for significant price adjustments.
The median home value in ZIP 95916 is $251,443, which is relatively low compared to other areas in California. This makes it easier for landlords to acquire properties at a lower initial investment, thereby maximizing their return on investment (ROI).
Despite the potential for positive cash flow, ZIP 95916 does not present a strong case for being an appreciation play. Data on price-cut shares and days on market (DOM) are not available, suggesting a stable rather than rapidly appreciating market. This stability is beneficial for long-term cash flow generation but less so for short-term capital gains.
The ZIP code also acts as a diversifier within a larger Section 8 portfolio due to its 10.7% renter share. This percentage reflects the portion of the population that relies on rental housing, including those who might benefit from Section 8 vouchers. Additionally, the median income of $28,333 aligns well with the demographic that typically qualifies for Section 8 assistance, making it a suitable location for such properties.
To summarize, ZIP 95916 is best categorized as a cash-flow anchor within a Section 8 portfolio strategy. Its favorable rent spread over the FMR and lower median home values ensure steady and reliable cash flows for landlords, while its characteristics as a diversifier provide additional benefits by attracting a consistent tenant base. Landlords should focus on acquiring properties that can be rented out at or slightly above the FMR to capitalize on the positive cash flow opportunities available in this ZIP code.
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.