Location: Ida County, IA | Metro: Crawford 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 | $700 |
| 1 Bedroom | $810 |
| 2 Bedrooms | $940 |
| 3 Bedrooms | $1,260 |
| 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 |
|---|---|---|---|---|
| 2BR | $940 | $141,751 | 0.66% | D |
| 3BR | $1,260 | $166,451 | 0.76% | D |
| 4BR | $1,310 | $142,838 | 0.92% | C |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 51461, located in Schleswig, Iowa, reveals some key insights into the potential investment returns. To start, let's consider the Fair Market Rent (FMR) for a two-bedroom apartment, which is set at $930 annually for Fiscal Year 2026, based on the metro area standards. Using this figure, we can calculate the implied gross yield. The median home value in the area is $165,243. If a landlord were to participate in the Section 8 program, the annual rental income would be $930, leading to an implied gross yield of approximately 0.56%, calculated by dividing the annual rental income ($930) by the median home value ($165,243).
In contrast, the market rent for a two-bedroom property, as reported by the Census Bureau's American Community Survey (ACS), stands at $534 annually. This lower figure results in a significantly reduced implied gross yield of about 0.32%. The calculation here involves the same division: annual market rent ($534) over median home value ($165,243).
The disparity between these two yields highlights the importance of understanding the local rental market dynamics. With a renter density of 22.9%, it's evident that the majority of homeowners in Schleswig, Iowa, prefer owning their homes rather than renting them out. This preference suggests that the market rent of $534 might be more reflective of the actual rental income landlords can expect, making the implied gross yield of 0.32% the more realistic scenario.
The absence of data on the number of days on market (DOM) complicates the assessment of how quickly properties might be rented under the Section 8 program. However, given the relatively low renter density, it's reasonable to assume that landlords might face longer vacancy periods if they rely solely on the Section 8 program, which could further reduce the effective yield below the 0.56% benchmark.
Investors should consider these figures carefully when evaluating the potential returns of participating in the Section 8 program versus traditional rental markets in Schleswig, Iowa. While the higher FMR rate offers a more attractive gross yield, the reality of the local rental market and the preferences of residents suggest that the lower market rent is likely to provide a more accurate representation of future rental income.
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.