How much Section 8 pays a landlord, step by step

A Housing Choice Voucher pays you the agency’s payment standard or the unit’s gross rent, whichever is lower, minus the tenant’s share. The tenant’s share is usually 30% of adjusted monthly income. That is the whole formula, written out in 24 CFR 982.505.

Four numbers decide it

1. The Fair Market Rent. HUD publishes it every year for each metro area and nonmetro county, and by ZIP code as the Small Area FMR. It is HUD’s estimate of the 40th percentile gross rent for recent movers into standard-quality units. FY 2027 figures took effect October 1, 2026. Look up your ZIP.
2. The payment standard. The local public housing agency (PHA) sets one for each bedroom size, anywhere from 90% to 110% of the FMR, without asking HUD (24 CFR 982.503(c)). Going above 110% generally takes HUD approval. In the 65 mandatory Small Area FMR metros the standard is set from the ZIP figure.
3. The utility allowance. FMRs and payment standards cover rent plus utilities. If the tenant pays any utilities, the PHA adds its allowance for them to your contract rent to get the gross rent.
4. The tenant’s total payment. The highest of 30% of adjusted monthly income, 10% of gross monthly income, a welfare rent where one applies, or the PHA’s minimum rent (24 CFR 5.628). For most families it is the 30% figure.

The payment standard used is also the lower of the one for the voucher’s bedroom count and the one for the unit’s. A family with a 2-bedroom voucher renting a 3-bedroom gets the 2-bedroom standard.

A worked example

Columbus, Ohio is a mandatory Small Area FMR metro. ZIP 43229’s FY 2027 Small Area FMR for a 2-bedroom is $1,480. Suppose the agency sets its payment standard at 100% of it, its utility allowance for this unit is $180 a month, and the family’s adjusted monthly income is $1,800. (The standard, allowance and income are example figures; the FMR is HUD’s.)

Asking rent	Gross rent	Voucher pays you	Tenant pays you	Tenant’s share of income, with utilities
$1,300	$1,480	$940	$360	30%
$1,400	$1,580	$940	$460	35.6%
$1,500	$1,680	$940	$560	41.1%

The voucher pays $1,480 minus $540 (30% of $1,800) in every row, because the gross rent is at or above the payment standard. Every dollar of rent above $1,300 comes out of the tenant’s pocket.

The third row fails. At move-in, when the gross rent is above the payment standard, the family’s share can’t exceed 40% of adjusted monthly income (24 CFR 982.508). Here that caps the gross rent at $1,660, or a contract rent of $1,480.

Rent reasonableness can cut it further

Before approving a lease, the PHA must decide your rent is reasonable compared with similar unassisted units, looking at location, quality, size, unit type, age, amenities and the utilities and services you provide (24 CFR 982.507). It checks again before any increase. A rent can sit inside the payment standard and still be cut here. By accepting each payment you also certify you aren’t charging the voucher tenant more than comparable unassisted tenants in the building.

What landlords get wrong

• Treating the FMR as the rent. It is the base for a range, it includes utilities, and the agency’s number can sit 10% either side of it.
• Forgetting the utility allowance. A unit where the tenant pays gas and electric supports a lower contract rent than the same unit with utilities included.
• Assuming the number only goes up. HUD caps a one-year FMR drop at 10%, but drops happen, and in FY 2027 several metros fell by the full 10%. A PHA isn’t required to cut a current family’s payment standard, and if it does, not for two years after the decrease (982.505(c)(3)).
• Skipping the inspection. The PHA inspects the unit as part of approving the tenancy. Ask how it schedules inspections and what it does about minor deficiencies, because that sets when the first payment arrives.

Taking vouchers and the law

Whether to rent to a voucher holder is not always your call. The federal Fair Housing Act doesn’t list source of income, but many states, counties and cities do, and in those places refusing a tenant because they pay with a voucher can be illegal. Advertising “no Section 8” can be too. Check the law where your property is and HUD’s fair housing pages, and screen voucher holders by the same written criteria you use for everyone.

HUD’s own landlord resources explain the lease, contract and inspection steps. This site is not HUD; the figures here are HUD’s public data, and your local PHA has the final word on its payment standard.

To see what a voucher rent does to a loan, put it in the DSCR calculator.