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: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,210 | $173,046 | 0.7% | D |
U.S. Census Bureau data (2024)
The analysis of ZIP code 51338 reveals a market that sits between high yield and steady cash flow, leaning slightly towards a high-yield scenario but with notable risks regarding stability.
On the yield axis, the Federal Market Rent (FMR) for the metro area in fiscal year 2026 stands at $960, which is significantly higher than the market rent of $713. This indicates a potential upside for landlords who can leverage Section 8 vouchers to achieve higher rental incomes. The median home value in the area is $154,233, which is relatively low compared to the FMR, suggesting a market where properties could be acquired at a lower cost and rented out at subsidized rates for a substantial profit margin.
However, when we consider stability, the picture becomes less clear. The ZIP code has only 16.0% of residents classified as renters, indicating a smaller pool of potential tenants who might rely on Section 8 vouchers. Additionally, the median household income of $57,500 suggests a middle-income area, which could mean a mix of voucher users and those who might prefer to pay market rates. The absence of data on the average days on market (DOM) for rentals implies uncertainty around how quickly properties can be leased, which is a key indicator of stability in rental markets.
To summarize, ZIP 51338 offers a high-yield opportunity due to the disparity between the FMR and market rent, along with the relatively low median home value. However, the limited percentage of renters and the lack of data on rental turnover rates introduce significant instability into the equation. Landlords and small-portfolio investors should proceed with caution, focusing on areas within the ZIP code that have higher concentrations of voucher holders and ensuring they have a robust tenant screening process in place.
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.