Section 8 Fair Market Rent (FMR) for ZIP 97123 - 2027

Investment Score for ZIP 97123

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	$1,610
1 Bedroom	$1,720
2 Bedrooms	$1,980
3 Bedrooms	$2,690
4 Bedrooms	$3,240
5 Bedrooms	$3,758
6 Bedrooms	$4,209
7 Bedrooms	$4,546
8 Bedrooms	$4,773

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
2BR	$1,980	$394,090	0.5%	F
3BR	$2,690	$498,718	0.54%	F
4BR	$3,240	$601,149	0.54%	F
5BR	$3,758	$724,659	0.52%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 97123 (Hillsboro, OR) #### Introduction ZIP code 97123 is located in Hillsboro, Oregon, within Washington County. The area has a population of 48,410 residents, with a median household income of $109,985. Approximately 30.2% of the population are renters, and the occupancy rate stands at 96.8%. This analysis will focus on the dynamics of Section 8 vouchers, affordability, renter profiles, investor opportunities, and actionable insights for landlords and investors interested in this ZIP code. #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for 2026 in ZIP 97123 is set as follows: - 0BR: $1620 - 1BR: $1730 - 2BR: $1980 (which represents 21.6% of the median income) - 3BR: $2700 - 4BR: $3200 These figures represent the maximum amount that a landlord can charge a tenant who is using a Section 8 voucher. However, it is important to note that these rates are significantly lower than the actual market rents. For instance, the Zillow median price for a 2BR unit in 97123 is $397,744, which translates to a monthly rental cost of approximately $1657 based on typical mortgage payments and property taxes. Given the FMR for a 2BR unit is $1980, the actual rental costs are likely higher, making it challenging for voucher holders to find suitable housing. The price-to-FMR ratio for a 2BR unit is 16.7x, indicating that the market rents are far above the FMR. This suggests that voucher holders face significant constraints in finding affordable housing within their budget. Landlords who accept Section 8 vouchers must be willing to rent below market rates, which can be a disincentive given the high demand for rental properties in the area. #### Affordability & Renter Profile Given the median household income of $109,985, the FMR for a 2BR unit at $1980 is indeed affordable, representing only 21.6% of the median income. However, the actual market rents are much higher, making it difficult for low-income families to afford housing without assistance. The high occupancy rate of 96.8% indicates that the market is relatively tight, with few vacant units available. This tightness exacerbates the challenges faced by voucher holders, as they have limited options to choose from. The renter profile in 97123 is diverse but skewed towards individuals and families who can afford higher rents due to the high median income. The 30.2% renter population suggests a mix of homeowners and renters, but the high price-to-FMR ratio indicates that the majority of renters are likely middle to upper-middle class individuals who do not rely on government assistance. #### Investor Angle From an investor perspective, the ZIP code 97123 presents both opportunities and challenges. The high occupancy rate and median income suggest strong demand for rental properties, which can translate into steady cash flow. However, the price-to-FMR ratio of 16.7x means that landlords who accept Section 8 vouchers will be renting at a substantial discount compared to market rates. To determine if this ZIP code is cash-flow positive at FMR, we need to consider the typical operating expenses and mortgage payments. Assuming a conservative estimate of 50% of the Zillow median price ($397,744) as the purchase price, a 30-year fixed-rate mortgage at 5% interest would result in a monthly payment of around $1657. Adding typical operating expenses such as property taxes, insurance, maintenance, and utilities could bring the total monthly expense to around $2000-$2200. At the FMR of $1980 for a 2BR unit, the cash flow would be negative unless the investor can reduce operating expenses significantly. Therefore, while there is strong demand, the investment grade for Section 8-focused properties is moderate to low due to the financial constraints imposed by the FMR. #### Specific Actionable Insights 1. **Target Larger Units**: Given the high FMR for larger units (3BR and 4BR), investors should consider targeting properties with three or four bedrooms. The FMR for a 3BR unit is $2700, which is closer to the market rate and offers better cash flow potential. For example, a 3BR unit priced at $2700 would be more attractive to voucher holders and potentially less financially burdensome for landlords. 2. **Focus on Location**: Within ZIP 97123, certain areas might offer better opportunities for cash flow positive rentals. Investors should research neighborhoods with slightly lower market rents or those where the demand for Section 8 vouchers is higher. This could help mitigate the gap between FMR and market rates. 3. **Consider Non-Section 8 Tenants**: Given the high median income and the tight rental market, investors might find it more profitable to target non-Section 8 tenants who can pay market rates. This strategy would require marketing efforts to attract higher-income renters but could provide a more stable and lucrative investment. #### Bottom Line Based on the analysis, the recommendation for Section 8-focused investors in ZIP 97123 is to **Skip**. The high price-to-FMR ratio and the financial constraints associated with accepting Section 8 vouchers make it challenging to achieve positive cash flow. While there is strong demand for rental properties, the tight market and high median income suggest that targeting non-Section 8 tenants would be more financially viable. However, for investors willing to accept Section 8 vouchers and looking to serve a critical need in the community, focusing on larger units (3BR and 4BR) could provide a more balanced investment opportunity. These units have FMRs that are closer to market rates, offering a better chance of positive cash flow. In summary, while ZIP 97123 presents a robust rental market, the financial realities of Section 8 vouchers make it a less favorable option for investors seeking positive cash flow.

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.