Location: Minneapolis-St. Paul-Bloomington, MN | Metro: Minneapolis-St. Paul-Bloomington, MN-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 | $1,230 |
| 1 Bedroom | $1,390 |
| 2 Bedrooms | $1,690 |
| 3 Bedrooms | $2,210 |
| 4 Bedrooms | $2,470 |
| 5 Bedrooms | $2,865 |
| 6 Bedrooms | $3,209 |
| 7 Bedrooms | $3,466 |
| 8 Bedrooms | $3,639 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,690 | $321,056 | 0.53% | F |
| 3BR | $2,210 | $424,712 | 0.52% | F |
| 4BR | $2,470 | $566,183 | 0.44% | F |
| 5BR | $2,865 | $661,255 | 0.43% | F |
U.S. Census Bureau data (2024)
The HUD Fair Market Rent (FMR) for ZIP code 54016, which includes Hudson, WI, Saint Croix County, and is part of the Minneapolis-St. Paul-Bloomington, MN-WI HUD Metro FMR Area, is set at $1680 for fiscal year 2024. This figure is slightly below the current market rent, as indicated by the Zillow Observed Rent Index (ZORI), which stands at $1790. Given this comparison, landlords can expect that voucher tenants will generally cashflow marginally at the HUD FMR rate, necessitating careful management to ensure profitability.
To further analyze the investment potential, consider the median home value in ZIP 54016, which is $487,080. The rent-to-price ratio, calculated using the ZORI rent of $1790, suggests a ratio of approximately 0.37%. This ratio indicates that rental income represents a small portion of the total property value, which could be less attractive for investors focused solely on cash flow but still viable when considering other factors such as property appreciation or stability.
In terms of the broader real estate market dynamics, the 30-day median Days on Market (DOM) and the low 0.1% share of listings experiencing price cuts suggest a stable housing market with relatively quick sales. These metrics imply that the area has a robust demand for both rentals and home purchases, creating a balanced environment where both types of investments can thrive.
The strongest investor angle in ZIP 54016 appears to be stability. The combination of a slight margin for cash flow, a solid median home value, and a healthy real estate market make this area an excellent choice for investors seeking consistent performance over time.
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.