Location: Goodhue County, 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 | $1,210 |
| 1 Bedroom | $1,430 |
| 2 Bedrooms | $1,730 |
| 3 Bedrooms | $2,360 |
| 4 Bedrooms | $2,840 |
| 5 Bedrooms | $3,294 |
| 6 Bedrooms | $3,689 |
| 7 Bedrooms | $3,984 |
| 8 Bedrooms | $4,183 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $2,360 | $473,938 | 0.5% | F |
U.S. Census Bureau data (2024)
Skeptical investors looking into ZIP 55089 often have valid concerns regarding the financial feasibility of renting properties in this area. Let's address these concerns head-on using the available data.
Will FMR $1550 (zip FY 2024) cover the mortgage on a $486,958 home?
The Fair Market Rent (FMR) for ZIP 55089 in fiscal year 2024 is set at $1550. To determine if this will cover the mortgage on a home priced at $486,958, we must consider the typical mortgage rate and terms. Assuming a standard 30-year fixed-rate mortgage at an average interest rate of 5%, the monthly payment on a $486,958 home would be approximately $2,580. This means that the FMR of $1550 would not fully cover the mortgage payment, leaving a shortfall of around $1,030 per month. Investors would need to ensure they can cover this additional cost through other income sources or savings.
Is there enough renter demand at 9.7%?
The rental vacancy rate in ZIP 55089 stands at 9.7%. This percentage is higher than the national average, which typically hovers around 7%. A higher vacancy rate suggests less demand for rental properties, which could pose challenges for landlords in maintaining occupancy. However, it also indicates that there might be opportunities to attract tenants with competitive pricing or amenities, thereby increasing demand. It's crucial for investors to analyze local economic factors and job markets to understand potential tenant influxes.
Will vouchers keep pace with $1,679 market rents?
The Housing Choice Voucher program aims to help low-income families afford decent housing. In ZIP 55089, the market rent is $1,679. The voucher amount is adjusted annually based on the HUD's Fair Market Rents, but the data does not specify the exact voucher amount for this ZIP code. Given the FMR of $1550, it's likely that the voucher amount is close to this figure, potentially falling short of the market rent. Landlords should be prepared to accept some level of subsidy or negotiate with tenants who use vouchers to ensure the total rent covers their costs.
The data provides insights into the financial landscape of ZIP 55089 but does not fully resolve all concerns. For instance, the exact voucher amount isn't given, making it challenging to predict how well they will align with market rents. Similarly, while the FMR and vacancy rates offer a snapshot of the rental market, they do not account for individual property conditions or the broader economic context that influences tenant demand and mortgage affordability.
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.