Location: Vernon County, WI | Metro: La Crosse-Onalaska, WI-MN HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $890 |
| 1 Bedroom | $990 |
| 2 Bedrooms | $1,270 |
| 3 Bedrooms | $1,600 |
| 4 Bedrooms | $1,920 |
| 5 Bedrooms | $2,227 |
| 6 Bedrooms | $2,494 |
| 7 Bedrooms | $2,694 |
| 8 Bedrooms | $2,829 |
U.S. Census Bureau data (2024)
The Section 8 thesis in ZIP code 54623 revolves around the disparity between the Fair Market Rent (FMR) set at $1110 for fiscal year 2024 and the actual market rent, which stands at $1040 according to the Census ACS. This creates a gap of $70, or approximately 6.4%, in favor of the FMR.
This situation makes ZIP 54623 a compelling opportunity for landlords and small-portfolio investors seeking to maximize yields. Voucher tenants, under the Section 8 program, will pay rents based on the higher FMR figure, thereby providing a guaranteed income above the local market rate. This ensures that property owners can achieve a higher return on investment without the risk associated with fluctuating market rents.
However, it's important to anchor this analysis within the broader context of the ZIP code. With only 12.7% of residents being renters, the pool of potential voucher tenants is relatively limited. The median home value in the area is $339,573, suggesting a mix of homeownership and rental properties. Additionally, the median income of $88,864 indicates a moderate economic status among residents, which could influence their ability to cover non-rent expenses when renting.
The higher FMR compared to the market rent means that landlords accepting voucher tenants will be subsidized to a level that exceeds what they might charge in the open market. This subsidy effectively compensates for the administrative costs and potential risks associated with the Section 8 program, such as delays in payment processing and the requirement to undergo regular inspections. In essence, the FMR acts as a safety net, ensuring that landlords receive a stable and slightly elevated income stream relative to the typical market conditions.
Investors should consider these factors carefully. While the guaranteed higher rent through the Section 8 program can lead to attractive yields, the overall rental market share and the economic profile of the area also play significant roles in determining the success of such investments. The combination of a favorable FMR and a moderate rental market presence makes ZIP 54623 a viable option for those looking to leverage the Section 8 program for better financial returns.
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.