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 | $1,210 |
| 1 Bedroom | $1,370 |
| 2 Bedrooms | $1,660 |
| 3 Bedrooms | $2,170 |
| 4 Bedrooms | $2,430 |
| 5 Bedrooms | $2,819 |
| 6 Bedrooms | $3,157 |
| 7 Bedrooms | $3,410 |
| 8 Bedrooms | $3,581 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,370 | $128,054 | 1.07% | B |
| 2BR | $1,660 | $335,214 | 0.5% | F |
| 3BR | $2,170 | $455,522 | 0.48% | F |
| 4BR | $2,430 | $589,772 | 0.41% | F |
| 5BR | $2,819 | $880,911 | 0.32% | F |
U.S. Census Bureau data (2024)
The ZIP code 55105, located in Saint Paul, MN, within the Minneapolis-St. Paul-Bloomington, MN-WI HUD Metro FMR Area, serves as a cash-flow anchor in a Section 8 portfolio strategy. This conclusion is based on the significant spread between the Fair Market Rent (FMR) set at $1610 for fiscal year 2024 and the actual market rent of $1441. The FMR, established by the U.S. Department of Housing and Urban Development (HUD), ensures that landlords receive a rent amount that exceeds the local market average, providing a stable and predictable source of income.
Moreover, the median home value in ZIP 55105 stands at $471,058, which indicates a relatively high property value area. However, the focus here is on rental properties, and the guaranteed higher rent through the Section 8 program directly impacts cash flow positively. Landlords can rely on receiving a consistent and above-market rent, which helps in stabilizing their financial planning and reduces the risk associated with potential rent defaults or vacancies.
The ZIP code also exhibits a low price-cut share at 0.1%, suggesting that landlords rarely need to reduce rents to attract tenants, further reinforcing its role as a cash-flow anchor. Additionally, the Days on Market (DOM) figure of 40 days indicates that properties are quickly rented out, minimizing vacancy periods and ensuring steady cash inflows.
While the renter share of 33.4% and median income of $107,248 could suggest opportunities for appreciation or diversification plays, the primary benefit of ZIP 55105 lies in its capacity to generate reliable cash flow due to the favorable spread between FMR and market rent. This makes it an ideal choice for landlords looking to secure a stable financial foundation within their investment portfolios.
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.