Location: Redding, CA | Metro: Redding, 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 | $1,150 |
| 1 Bedroom | $1,160 |
| 2 Bedrooms | $1,520 |
| 3 Bedrooms | $2,100 |
| 4 Bedrooms | $2,540 |
| 5 Bedrooms | $2,946 |
| 6 Bedrooms | $3,300 |
| 7 Bedrooms | $3,564 |
| 8 Bedrooms | $3,742 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,160 | $189,791 | 0.61% | D |
| 2BR | $1,520 | $264,217 | 0.58% | F |
| 3BR | $2,100 | $376,885 | 0.56% | F |
| 4BR | $2,540 | $493,019 | 0.52% | F |
| 5BR | $2,946 | $610,190 | 0.48% | F |
U.S. Census Bureau data (2024)
The analysis of the Section 8 program in ZIP code 96001, which encompasses parts of Redding, California, reveals a significant gap between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR is set at $1,400, while the Zillow Observed Rent Index (ZORI) indicates a market rent of $1,598. This means that the market rent exceeds the FMR by $198, or approximately 14.14%. The discrepancy highlights the financial challenge landlords face when accepting Section 8 vouchers, as they must accept rental payments that are lower than what the open market demands.
In the context of Redding, where 39.0% of residents are renters and the median home value stands at $383,510, the median household income is reported at $72,484. These figures underscore the economic realities faced by both tenants and landlords. While the Section 8 program aims to provide affordable housing to low-income families, it often results in landlords receiving less than the prevailing market rate for their properties.
The cost of housing voucher tenants below open-market rates can be substantial. Landlords must consider the reduced rental income against the backdrop of maintenance costs, property taxes, and other expenses associated with owning rental properties. Despite these challenges, some landlords still find value in accepting Section 8 tenants due to the steady stream of government-subsidized income, which can be more reliable than relying solely on the open market.
However, the gap between the FMR and market rent also suggests that landlords might need to adjust their expectations and potentially look for ways to reduce costs or increase efficiency to maintain profitability. This could involve improving property management practices, seeking additional sources of income, or carefully selecting properties that align with the FMR guidelines.
To summarize, the $198 difference between the FMR and market rent in ZIP 96001 represents a 14.14% shortfall for landlords participating in the Section 8 program. Given the broader economic context of Redding, landlords must weigh the benefits of stable rental income against the financial implications of renting below market rates.
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.