Location: Dickinson County, IA | Metro: Clay 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 | $750 |
| 1 Bedroom | $750 |
| 2 Bedrooms | $990 |
| 3 Bedrooms | $1,210 |
| 4 Bedrooms | $1,310 |
| 5 Bedrooms | $1,520 |
| 6 Bedrooms | $1,702 |
| 7 Bedrooms | $1,838 |
| 8 Bedrooms | $1,930 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $750 | $82,350 | 0.91% | C |
| 2BR | $990 | $146,599 | 0.68% | D |
| 3BR | $1,210 | $206,600 | 0.59% | F |
| 4BR | $1,310 | $256,712 | 0.51% | F |
| 5BR | $1,520 | $361,957 | 0.42% | F |
U.S. Census Bureau data (2024)
The rent math in ZIP code 51301, which encompasses Spencer, IA, and parts of Dickinson County, does not favor landlords. The Federal Market Rent (FMR) for the area, set at $960 for fiscal year 2026, exceeds the current market rent of $807 based on Census ACS data. This discrepancy suggests that landlords may struggle to charge rents that align with government standards without facing resistance from potential tenants.
Acquisition in ZIP 51301 is relatively affordable, with a median home value of $193,067. However, the lack of data on days on market (DOM) and the low percentage of homes that have required a price cut (0.1%) indicate a stable but not particularly dynamic housing market. This stability can be beneficial for investors seeking to avoid volatile property values but may also limit opportunities for significant capital appreciation.
Tenant demand in ZIP 51301 is moderate. With a total population of 12,638 and 29.7% of residents being renters, there is a consistent pool of potential tenants. This demographic supports the idea that landlords can expect a reasonable level of interest in their rental properties, though it's important to note that the renter share is less than a third of the total population, suggesting a smaller market compared to areas with higher renter shares.
Verdict: ZIP 51301 presents a mixed picture for landlords and small-portfolio investors. While the acquisition cost is reasonable and the tenant demand is steady, the mismatch between the FMR and the actual market rent poses a challenge. Landlords must carefully manage their expenses to ensure profitability. The stable housing market offers security against rapid price fluctuations but limits growth potential. Given these factors, ZIP 51301 is suitable for conservative investors seeking steady income rather than those looking for aggressive capital appreciation.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.