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 | $1,150 |
| 1 Bedroom | $1,340 |
| 2 Bedrooms | $1,530 |
| 3 Bedrooms | $2,020 |
| 4 Bedrooms | $2,260 |
| 5 Bedrooms | $2,622 |
| 6 Bedrooms | $2,937 |
| 7 Bedrooms | $3,172 |
| 8 Bedrooms | $3,331 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,530 | $360,992 | 0.42% | F |
| 3BR | $2,020 | $411,664 | 0.49% | F |
| 4BR | $2,260 | $474,912 | 0.48% | F |
| 5BR | $2,622 | $523,032 | 0.5% | F |
U.S. Census Bureau data (2024)
The classification of ZIP 53716 in Madison, WI, hinges on an analysis of its yield and stability metrics, using the Federal Market Rent (FMR) of $1,310 for fiscal year 2024, the market rent at $1,993, and the median home value of $412,183. The percentage of renters stands at 28.1%, with the median household income noted at $91,716.
On the yield axis, ZIP 53716 leans towards a high-yield market. The FMR of $1,310 is significantly below the market rent of $1,993, indicating a potential to charge higher rents and achieve better cash-on-cash returns. This gap suggests that landlords can potentially generate above-average yields by positioning their properties competitively in the rental market.
Regarding stability, the picture is less clear. With only 28.1% of the population being renters, the demand for rental units might be lower compared to areas with a higher percentage of renters. However, the median household income of $91,716 provides a strong economic base, which supports the ability of residents to pay rent consistently. The lack of data on days on market (DOM) makes it challenging to assess how quickly vacancies might be filled, but the income figure suggests a stable financial environment for tenants.
In conclusion, ZIP 53716 appears to be a market that offers a balance between high yield and moderate stability. While the potential for high rental income is evident, the relatively low percentage of renters could pose challenges in maintaining consistent occupancy rates. Landlords and small-portfolio investors should consider these factors when deciding on investment strategies in this area.
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.