Location: South Bend-Mishawaka, IN | Metro: Elkhart-Goshen, IN MSA
Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,060 |
| 1 Bedroom | $1,210 |
| 2 Bedrooms | $1,420 |
| 3 Bedrooms | $1,740 |
| 4 Bedrooms | $1,880 |
| 5 Bedrooms | $2,181 |
| 6 Bedrooms | $2,443 |
| 7 Bedrooms | $2,638 |
| 8 Bedrooms | $2,770 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,420 | $186,841 | 0.76% | D |
| 3BR | $1,740 | $291,045 | 0.6% | F |
| 4BR | $1,880 | $374,015 | 0.5% | F |
| 5BR | $2,181 | $501,946 | 0.43% | F |
U.S. Census Bureau data (2024)
Osceola, IN, located in ZIP code 46561, is a small town with a population of 13,996 residents. The town has a relatively low percentage of renters at 14.5%, indicating a primarily owner-occupied community. Median household income in the area stands at $91,711, reflecting a middle-class demographic. Median home values are notably high at $285,085, suggesting that homeownership is both desirable and financially significant for many residents.
The rental market in Osceola presents an interesting opportunity for investors. According to the Fair Market Rent (FMR) data for fiscal year 2024, the FMR for ZIP code 46561 is set at $1,100. In contrast, the Census American Community Survey (ACS) reports the average market rent at $1,199. This difference highlights a potential gap between federally subsidized rents and the actual market rates, which could be advantageous for landlords and small-portfolio investors looking to balance affordability with profitability.
Given these economic factors, ZIP code 46561 is well-suited for hands-on value-add buyers rather than hands-off voucher operators. The higher median home values suggest that there is room for property appreciation and improvement. Additionally, the slightly elevated market rent compared to the FMR indicates that there might be opportunities to increase cash flow through strategic property management and enhancements. For hands-off operators, the discrepancy between FMR and market rent could pose challenges in finding tenants willing to pay the lower voucher rate. However, for those who are willing to engage actively in the local market, there is potential to capitalize on the town's economic stability and the demand for quality rentals.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-08-31). 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.