Location: Cherokee County, IA | Metro: Cherokee County, IA
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 | $690 |
| 1 Bedroom | $770 |
| 2 Bedrooms | $930 |
| 3 Bedrooms | $1,200 |
| 4 Bedrooms | $1,290 |
| 5 Bedrooms | $1,496 |
| 6 Bedrooms | $1,676 |
| 7 Bedrooms | $1,810 |
| 8 Bedrooms | $1,901 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $770 | $67,518 | 1.14% | B |
| 2BR | $930 | $114,468 | 0.81% | C |
| 3BR | $1,200 | $167,967 | 0.71% | D |
| 4BR | $1,290 | $206,549 | 0.62% | D |
| 5BR | $1,496 | $300,475 | 0.5% | F |
U.S. Census Bureau data (2024)
The ZIP code 51012, located in Cherokee, IA, serves as a cash-flow anchor within a Section 8 portfolio strategy. The Federal Market Rent (FMR) for the metro area in fiscal year 2026 is set at $920, which is significantly higher than the current market rent of $803. This spread ensures that landlords can rely on stable rental income that exceeds market rates, providing a solid foundation for cash flow.
The median home value in Cherokee, IA is $148,297, indicating a relatively affordable market. With a 31.1% renter share, there is a notable demand for rental properties, which supports the viability of a Section 8 strategy. Additionally, the median income of $69,531 suggests that residents have the financial stability to meet their rental obligations.
Despite the potential for appreciation, given the low price-cut share of 0.1%, Cherokee's real estate market does not show significant signs of rapid growth. However, the stability offered by the FMR and the substantial number of renters make it an ideal location for securing reliable cash flow.
To illustrate, consider the recent listings on Zillow: a house for $367,000 with 4 bedrooms and 3 bathrooms, or a smaller property for $154,000 with 3 bedrooms and 2 bathrooms. These properties, when rented under Section 8, can provide a consistent income stream above the market rate, thus serving as anchors in your investment portfolio.
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.