HUD’s 2027 Fair Market Rents rose 2% on average, and 18% of areas fell
The voucher rent benchmarks that took effect Oct. 1 grew at the slowest weighted pace in years, and Phoenix and Atlanta landlords now face lower two-bedroom figures.
By Erick Tarray · · 3 min read
HUD published its fiscal 2027 Fair Market Rents on Sept. 1, and they took effect Oct. 1 [1]. Local housing agencies use FMRs to set Housing Choice Voucher payment standards, so the new figures feed into how much rent a voucher can cover [2].
Novogradac calculated a population-weighted increase of 2.0%, compared with 2.8% for fiscal 2026 [2]. The simple average across 4,765 areas was 3.4%, because several of the largest areas posted decreases [2].
California and Texas both posted declines
Thirteen states and territories had an average decrease, including California and Texas, which have historically posted large increases [2]. HUD caps any drop at 10% below the prior year’s FMR for the same unit size [1].
| HUD FMR area | FY2026 | FY2027 | Change |
|---|---|---|---|
| San Francisco | $3,604 | $3,697 | +2.6% |
| Los Angeles-Long Beach-Glendale | $2,903 | $2,964 | +2.1% |
| Denver-Aurora-Centennial | $2,089 | $2,169 | +3.8% |
| Chicago-Joliet-Naperville | $1,781 | $2,011 | +12.9% |
| Atlanta-Sandy Springs-Roswell | $1,820 | $1,762 | −3.2% |
| Phoenix-Mesa-Chandler | $1,839 | $1,734 | −5.7% |
HUD changed how it estimates utility costs
The Bureau of Labor Statistics stopped publishing its local fuels and utilities index, so HUD now builds utility inflation from electricity, natural gas, fuel oil and water, sewer and trash components [1]. HUD also stopped excluding newly built units from the rent data [1].
The base rents come from 2020–2024 American Community Survey data, adjusted with 2024 one-year figures for recent movers [1]. The national non-metro rent used as a floor is $1,014 [1].
In metros that must use Small Area FMRs, which set rents by ZIP code, the fiscal 2027 figures cannot fall below 90% of last year’s, and two-bedroom rents are capped at 150% of the metro figure [1].
How to use this
For landlords who rent to voucher holders
- Look up your area in HUD’s FY2027 schedule before you send a renewal. In Phoenix, we calculate the two-bedroom figure fell $105 a month, to $1,734 [3][4], so a renewal priced off last year’s number may exceed what the agency will approve.
- Ask your local housing agency in writing when it will adopt payment standards based on the new FMRs, because the new figures have been in effect since Oct. 1 [1].
- In falling areas such as Atlanta, ask the agency whether it plans to request a reevaluation. Supporting data is due by Jan. 8, 2027, and HUD expects to post revised FMRs in April [1].
- Check your ZIP code if you own in a Small Area FMR metro. A unit in a high-rent ZIP can be capped at 150% of the metro two-bedroom figure [1], so in a metro with Denver’s $2,169 figure the cap would be about $3,254 by our math [3].
For rental investors and lenders
- Replace FY2026 figures in any voucher-rent underwriting. Chicago’s two-bedroom FMR rose $230 to $2,011 [3][4], while the 10 most populous areas averaged no change [2].
- Give rural deals a second look, since non-metro FMRs rose 4.13% against 1.66% for metros [2].
For affordable housing developers
- Check whether your area’s income limits use the FMR floor. In high-cost areas, the very low income limit is at least the two-bedroom FMR times 0.85, divided by 0.35, times 12, before caps and floors [2].
This is market commentary, not investment or legal advice.
Sources
- [1]U.S. Department of Housing and Urban Development, Fair Market Rents for the Housing Choice Voucher Program and Other Programs, Fiscal Year 2027 (FR Doc. 2026-17891), Sep 1, 2026.
- [2]Novogradac, HUD FY 2027 FMRs: Weighted Average Change Is 2.0%, Sep 1, 2026.
- [3]U.S. Department of Housing and Urban Development, FY 2027 Schedule of Metropolitan and Non-Metropolitan Fair Market Rents, Sep 1, 2026.
- [4]U.S. Department of Housing and Urban Development, Fair Market Rents, FY2026 (HUD eGIS map service), May 21, 2026.
