Location: Polk County, WI | Metro: Polk County, WI
| Unit Size | Monthly FMR |
|---|---|
| Studio | $710 |
| 1 Bedroom | $780 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,310 |
| 4 Bedrooms | $1,550 |
| 5 Bedrooms | $1,798 |
| 6 Bedrooms | $2,014 |
| 7 Bedrooms | $2,175 |
| 8 Bedrooms | $2,284 |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 54824 provides insight into the potential returns for landlords and small-portfolio investors. Using the Fair Market Rent (FMR) for a two-bedroom apartment set at $1,000 annually and the Census Bureau's reported market rent of $929, we can derive the gross yields based on the median home value of $299,028.
First, let’s calculate the gross yield using the FMR. At an annual rent of $1,000, the gross yield would be approximately 0.33%, derived by dividing the annual rent by the median home value ($1,000 / $299,028).
Next, applying the Census-reported market rent of $929, the gross yield drops slightly to about 0.31%. This calculation is achieved by dividing the market rent by the median home value ($929 / $299,028).
Given the 23.8% renter density in the area, it is important to note that while these gross yields appear low, they should be considered within the context of the ZIP code's rental market dynamics. The N/A-day DOM (Days on Market) suggests that there might be limited data on how quickly rental properties are occupied, but with a significant portion of the population renting, demand for affordable housing is likely strong.
The lower gross yield based on market rent reflects the reality that landlords might not always achieve the maximum allowable rent under the Section 8 program. However, the higher gross yield based on FMR indicates the potential maximum return if the property is rented at the stipulated rate. For most investors, the gross yield based on market rent is more realistic due to the actual rental rates being closer to what tenants pay.
In conclusion, the gross yields of 0.33% and 0.31% provide a baseline for understanding the financial landscape of Section 8 rentals in ZIP 54824. While these figures are modest, they must be evaluated alongside other factors such as occupancy rates, maintenance costs, and the stability of rental income provided by the Section 8 program.
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.