Location: Monona County, IA | Metro: Monona 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 | $760 |
| 1 Bedroom | $790 |
| 2 Bedrooms | $1,030 |
| 3 Bedrooms | $1,290 |
| 4 Bedrooms | $1,720 |
| 5 Bedrooms | $1,995 |
| 6 Bedrooms | $2,234 |
| 7 Bedrooms | $2,413 |
| 8 Bedrooms | $2,534 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,030 | $131,007 | 0.79% | D |
| 3BR | $1,290 | $184,884 | 0.7% | D |
| 4BR | $1,720 | $191,081 | 0.9% | C |
U.S. Census Bureau data (2024)
The ZIP code 51040, encompassing Onawa, IA, within the Monona County area, is a strategic fit for a Section 8 portfolio due to its characteristics as a cash-flow anchor. With the Federal Market Rent (FMR) set at $990 for the metro area in fiscal year 2026, and the market rent at $947, there exists a positive spread of $43 per unit. This indicates that landlords can expect to receive slightly above-market rents through the Section 8 program, thereby securing stable cash flow.
The median home value in ZIP 51040 stands at $148,686, which is relatively low compared to national averages. This affordability makes the area attractive for tenants who qualify for Section 8 housing vouchers. Landlords benefit from the guaranteed rental income, as the government covers the difference between the market rate and the tenant's contribution, ensuring steady payments.
Additionally, the ZIP code has a 24.7% renter share, indicating a significant portion of the population relies on rental housing. Given the median income of $71,179, many residents likely need assistance to afford housing, making Section 8 an essential part of the local rental market. This high dependency on rental support suggests that the demand for affordable housing will remain consistent, further solidifying the potential for stable cash flow.
In conclusion, ZIP 51040 serves as a strong cash-flow anchor within a Section 8 portfolio strategy. The positive spread between the FMR and market rent, coupled with the low median home value and high renter share, supports this classification. Landlords can expect reliable income streams, with the government ensuring timely rent payments, thus reducing financial risks associated with vacancy and delinquency.
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.