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 | $1,340 |
| 1 Bedroom | $1,510 |
| 2 Bedrooms | $1,830 |
| 3 Bedrooms | $2,390 |
| 4 Bedrooms | $2,680 |
| 5 Bedrooms | $3,109 |
| 6 Bedrooms | $3,482 |
| 7 Bedrooms | $3,761 |
| 8 Bedrooms | $3,949 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,510 | $258,280 | 0.58% | F |
| 2BR | $1,830 | $299,409 | 0.61% | D |
| 3BR | $2,390 | $376,168 | 0.64% | D |
| 4BR | $2,680 | $449,895 | 0.6% | F |
| 5BR | $3,109 | $609,607 | 0.51% | F |
U.S. Census Bureau data (2024)
The market analysis for Section 8 investors in ZIP code 55110, White Bear Lake, MN, reveals a competitive but manageable rental environment. The HUD Fair Market Rent (FMR) for the area in fiscal year 2024 is set at $1,560 per month, which is below the current market rent of $1,701 (ZORI). This means that voucher tenants will only cashflow with premium units or units priced slightly below the market rate. For instance, if an investor can find units priced at $1,600 or less, they can achieve positive cashflow given the $1,560 voucher payment.
To further understand the investment potential, consider the median home value in the area, which stands at $378,448. This yields a rent-to-price ratio of approximately 0.46%, indicating a relatively low rental yield compared to home values. However, this ratio also suggests that the housing market is stable and likely to maintain its value over time, providing a solid foundation for long-term investments.
The rental market dynamics are also favorable, with a median Days on Market (DOM) of 24 days and a price-cut share of just 0.2%. These figures suggest that properties in the area sell quickly and without significant price reductions, indicating strong demand and limited supply. This rapid turnover and minimal discounting benefit landlords, as it reduces the risk of vacancies and the need to lower rents to attract tenants.
In conclusion, while cashflow may be modest, the stability and potential appreciation of property values in White Bear Lake make it an attractive market for Section 8 investors. The strong demand for rentals and the quick sales cycle provide a reliable tenant base and minimize the risk of prolonged vacancies, making stability the strongest investor angle in this 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.