Section 8 Fair Market Rent (FMR) for ZIP 98902 - 2027

Investment Score for ZIP 98902

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	$1,030
1 Bedroom	$1,040
2 Bedrooms	$1,360
3 Bedrooms	$1,880
4 Bedrooms	$2,120
5 Bedrooms	$2,459
6 Bedrooms	$2,754
7 Bedrooms	$2,974
8 Bedrooms	$3,123

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	$1,040	$201,951	0.51%	F
2BR	$1,360	$257,015	0.53%	F
3BR	$1,880	$324,788	0.58%	F
4BR	$2,120	$367,343	0.58%	F
5BR	$2,459	$397,994	0.62%	D

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 98902 (Yakima, WA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 98902 in Yakima, WA, is set by HUD for 2026 as follows: - 0BR: $1050 - 1BR: $1060 - 2BR: $1390 - 3BR: $1930 - 4BR: $2120 These figures represent the maximum rent that a Section 8 voucher holder can pay based on the size of the unit they need. However, the actual rental market in 98902 presents a different picture. The Zillow median price for a 2BR unit is $250,684, which translates into a monthly mortgage payment of approximately $1,170 assuming a 30-year fixed-rate mortgage at 5%. This is already above the 2BR FMR of $1390. The Price-to-FMR ratio for 2BR units is 15.0x, indicating that the median home value is significantly higher than the FMR. This suggests that the actual rental rates in the area are likely much higher than the FMR. For instance, if we assume a typical rental rate is around 1% of the median home value, the monthly rent would be about $2,507, which is substantially more than the FMR of $1390. Therefore, voucher holders face significant constraints in finding affordable housing within their budget. They may have to settle for smaller units or look outside the immediate area to find properties that fit their rent limits. #### Affordability & Renter Profile The median household income in ZIP 98902 is $63,092, and 49.1% of the population are renters. With a 2BR unit’s FMR being $1390, this represents 26.4% of the median income. Given the high occupancy rate of 95.8%, it indicates that the market is relatively tight, with limited availability of units. This tightness could exacerbate the affordability challenges faced by renters, especially those relying on Section 8 vouchers. The renter profile in 98902 is diverse but includes a significant portion of low-income households. The high percentage of renters and the tight market suggest that competition for available units is fierce. Voucher holders, who often have limited options due to the strict rent limits imposed by the program, might struggle to secure housing in this competitive environment. #### Investor Angle From an investor perspective, the ZIP code 98902 appears to be challenging for cash flow-positive investments at the FMR level. The median home value for a 2BR unit is $250,684, which implies a monthly mortgage payment of roughly $1,170. Considering property taxes, insurance, maintenance, and other expenses, the total cost of ownership could easily exceed the FMR of $1390. To illustrate, let's break down the costs: - Monthly mortgage payment: $1,170 - Property tax (assuming 1% of home value annually): $209 - Homeowner’s insurance (average $1,200 annually): $100 - Maintenance and other expenses (average 1% of home value annually): $209 Total monthly expenses would be approximately $1,688, which is well above the FMR of $1390. This makes it difficult for investors to achieve positive cash flow when renting to Section 8 voucher holders. Consequently, the investment grade for this ZIP code would be considered low, particularly for properties aimed at the Section 8 market. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high Price-to-FMR ratio, investors should consider focusing on smaller units such as 0BR or 1BR properties. These units have lower FMRs ($1050 and $1060 respectively), which might align better with the actual rental market dynamics. Smaller units also tend to have lower mortgage payments, reducing the gap between FMR and actual costs. 2. **Consider Non-Section 8 Rental Options**: Due to the tight market and the high costs relative to FMR, investors might want to explore non-Section 8 rental options. By targeting the broader rental market, investors can potentially charge higher rents that reflect the actual market conditions. This strategy could help achieve positive cash flow and higher returns on investment. 3. **Look for Undervalued Properties**: Investors should seek out undervalued properties where the home value is closer to the Zillow median for 2BR units. If a 2BR unit can be purchased below $250,684, the monthly mortgage payment would decrease, making it more feasible to operate within the FMR guidelines while still achieving positive cash flow. #### Bottom Line Given the high Price-to-FMR ratio and the tight rental market in ZIP 98902, the recommendation for Section 8-focused investors is to **skip** this ZIP code. The costs of ownership are likely to exceed the FMR, leading to negative cash flow scenarios. Instead, investors might want to explore other areas with more favorable FMR-to-market price ratios or focus on smaller units where the gap between FMR and actual costs is less pronounced.

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.