Location: Polk County, WI | Metro: Minneapolis-St. Paul-Bloomington, MN-WI HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,120 |
| 1 Bedroom | $1,270 |
| 2 Bedrooms | $1,540 |
| 3 Bedrooms | $2,040 |
| 4 Bedrooms | $2,280 |
| 5 Bedrooms | $2,645 |
| 6 Bedrooms | $2,962 |
| 7 Bedrooms | $3,199 |
| 8 Bedrooms | $3,359 |
U.S. Census Bureau data (2024)
The Section 8 thesis in ZIP code 54007 is anchored by the significant disparity between the Fair Market Rent (FMR) set at $1270 for fiscal year 2024 and the actual market rent of $995 as reported by the Census ACS. This gap stands at $275, or approximately 28%, indicating that landlords can receive a higher subsidy than what the open market dictates.
This scenario makes voucher tenants an attractive option for yield-focused investments. Despite the 18.3% of residents being renters, the median home value in the area is $344,554, which is notably high. However, the median household income of $85,398 suggests that many residents may struggle to afford housing at the market rate, making them prime candidates for housing vouchers.
Landlords should be aware that while the higher FMR allows for greater rental income, it also means accepting tenants who may have additional requirements and support needs. The financial benefit comes from the government covering the difference between the market rate and the portion the tenant can afford based on their income, which is typically 30% of their adjusted monthly income. In ZIP 54007, this translates to a stable and predictable cash flow, despite the lower overall income levels compared to the high median home value.
To summarize, the FMR exceeding the market rent by $275 or 28% creates a compelling opportunity for landlords to maximize their returns through the Section 8 program. It is a strategy that leverages government subsidies to bridge the affordability gap for low-income renters, ensuring a steady income stream for property owners.
Data Sources: FMR data from HUD (2027). 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.