Location: Tehama County, CA | Metro: Tehama County, CA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $950 |
| 1 Bedroom | $1,050 |
| 2 Bedrooms | $1,370 |
| 3 Bedrooms | $1,880 |
| 4 Bedrooms | $2,270 |
| 5 Bedrooms | $2,633 |
| 6 Bedrooms | $2,949 |
| 7 Bedrooms | $3,185 |
| 8 Bedrooms | $3,344 |
U.S. Census Bureau data (2024)
The Section 8 thesis in ZIP 96074, Paskenta, CA, focuses on the discrepancy between the Fair Market Rent (FMR) and the actual market rent. The FMR for the metro area in fiscal year 2026 is $1,400, while the market rent is currently unavailable. This gap is critical for understanding the financial dynamics for landlords and small-portfolio investors.
Given that the market rent is not available, we rely on the FMR to assess the situation. With an FMR of $1,400, landlords can expect to receive rental assistance from the government for units rented at or below this amount. In ZIP 96074, 20.4% of the population are renters, indicating a significant portion of the market relies on affordable housing options.
The median household income in ZIP 96074 is $51,346, which suggests that many residents may qualify for housing vouchers. The FMR serves as a benchmark for the maximum rent a landlord can charge to remain within the program guidelines. Therefore, if the market rent exceeds $1,400, landlords who accept Section 8 tenants would be renting below market rates, potentially reducing their profit margins.
However, accepting Section 8 tenants can still be a lucrative strategy due to the guaranteed rental income and reduced vacancy risk. The consistent cash flow from government subsidies can offer a stable yield, especially in a market where the exact rent levels are unknown but likely higher than the FMR.
In conclusion, the gap between the FMR and the market rent in ZIP 96074 is pivotal for investment decisions. Landlords should consider the stability and security of rental income provided by Section 8 tenants, despite potentially renting below market rates. This strategy can ensure a steady yield and mitigate risks associated with fluctuating market conditions.
Data Sources: FMR data from HUD (2027). 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.