Location: Eau Claire, WI | Metro: Eau Claire, WI MSA
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 | $1,010 |
| 1 Bedroom | $1,020 |
| 2 Bedrooms | $1,260 |
| 3 Bedrooms | $1,700 |
| 4 Bedrooms | $1,700 |
| 5 Bedrooms | $1,972 |
| 6 Bedrooms | $2,209 |
| 7 Bedrooms | $2,386 |
| 8 Bedrooms | $2,505 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,260 | $249,742 | 0.5% | F |
| 3BR | $1,700 | $328,591 | 0.52% | F |
| 4BR | $1,700 | $414,840 | 0.41% | F |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP 54729, Chippewa Falls, WI, reveals interesting insights into potential investment opportunities. To begin, let's annualize the 2BR Fair Market Rent (FMR) and Zillow Observed Rent Index (ZORI) against the median home value.
The annualized FMR for a 2BR unit is $1070 multiplied by 12 months, totaling $12,840 per year. The ZORI for a 2BR unit is $1,180 monthly, which annualizes to $14,160 per year. With a median home value of $331,430, the implied gross-yield based on FMR is approximately 3.87%, calculated as $12,840 divided by $331,430. In contrast, the implied gross-yield based on ZORI is about 4.27%, calculated as $14,160 divided by $331,430.
Given that Chippewa Falls has a renter density of 31.0%, it's important to consider how this affects the likelihood of achieving either of these yields. The renter density suggests a significant portion of the population is already inclined towards renting, which can be beneficial for landlords participating in the Section 8 program. However, the lack of data on the days-on-market (DOM) for rental units makes it challenging to assess the speed at which properties can be leased out under the program.
The FMR yield of 3.87% is more aligned with the realities of the Section 8 program, which often involves government-set rent limits designed to ensure affordability. While the ZORI yield of 4.27% represents the market rate, it is less likely to be realized in a Section 8 property due to the fixed nature of rental assistance payments. For landlords and small-portfolio investors, the FMR scenario provides a clearer expectation of the returns they can anticipate from properties in this ZIP code.
In conclusion, while the market-rate ZORI suggests a slightly higher gross-yield, the more realistic scenario for Section 8 properties in Chippewa Falls is the FMR yield of 3.87%. This figure should be used as a baseline for investment decisions, keeping in mind the specific characteristics of the local rental market.
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.