Location: Madison, WI | Metro: Madison, WI HUD Metro FMR Area
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 | $1,220 |
| 1 Bedroom | $1,400 |
| 2 Bedrooms | $1,590 |
| 3 Bedrooms | $2,080 |
| 4 Bedrooms | $2,300 |
| 5 Bedrooms | $2,668 |
| 6 Bedrooms | $2,988 |
| 7 Bedrooms | $3,227 |
| 8 Bedrooms | $3,388 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,400 | $233,595 | 0.6% | F |
| 2BR | $1,590 | $403,912 | 0.39% | F |
| 3BR | $2,080 | $574,269 | 0.36% | F |
| 4BR | $2,300 | $735,732 | 0.31% | F |
| 5BR | $2,668 | $867,652 | 0.31% | F |
U.S. Census Bureau data (2024)
The real estate market in ZIP 53705, Madison, WI, is poised to maintain strong pricing power over the next 12-24 months. With a median home value of $556,632, the market demonstrates a high level of stability and desirability. The fact that only 0.1% of listings have been reduced signals a seller's market where demand exceeds supply, allowing for robust pricing without significant concessions.
The median days on market (DOM) being listed as N/A suggests a swift transaction process, indicative of an active and competitive market. This quick turnover supports the notion that homes are valued appropriately and are sought after by buyers.
On the rental side, the Federal Market Rent (FMR) for ZIP 53705 in fiscal year 2024 is set at $1,420, while the actual market rent, measured by Zillow's Observed Rent Index (ZORI), stands at $2,088. This substantial gap between government estimates and market rates highlights a favorable environment for landlords and investors looking to capitalize on rental income. The discrepancy indicates that rental properties can command higher rates, providing a buffer against potential increases in expenses such as property taxes and maintenance costs.
For long-term investors, the setup in ZIP 53705 implies a realistic appreciation thesis based on the strong fundamentals of the housing market. The consistent demand for both homeownership and rentals, coupled with the limited reduction in listing prices, points to an environment where asset values are likely to remain stable or increase gradually. However, it is important to note that appreciation is not guaranteed and will depend on broader economic conditions and local market dynamics.
The combination of high median home values, low listing reductions, and a strong rental market suggests that ZIP 53705 will continue to be attractive for those seeking to invest in real estate, whether for short-term gains through flipping properties or long-term appreciation and rental income.
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.