Section 8 Fair Market Rent (FMR) for ZIP 55119 - 2027

Investment Score for ZIP 55119

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,190
1 Bedroom	$1,340
2 Bedrooms	$1,630
3 Bedrooms	$2,130
4 Bedrooms	$2,390
5 Bedrooms	$2,772
6 Bedrooms	$3,105
7 Bedrooms	$3,353
8 Bedrooms	$3,521

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$1,340	$174,216	0.77%	D
2BR	$1,630	$243,289	0.67%	D
3BR	$2,130	$302,385	0.7%	D
4BR	$2,390	$383,088	0.62%	D
5BR	$2,772	$447,349	0.62%	D

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 55119 (Saint Paul, MN) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 55119 is set by HUD for 2026. For a two-bedroom unit, the FMR is $1600. This figure represents the maximum amount that a Section 8 voucher holder can be expected to pay towards rent, which is 23.5% of the median household income in the area ($81,865). However, the actual median rent for a two-bedroom unit on Zillow is $238,051, which translates to a monthly price of approximately $1983.76 when amortized over a year. This means that the actual rent is significantly higher than the FMR, creating a substantial gap between what voucher holders can afford and the market rate. Given this gap, voucher holders face significant constraints in finding affordable housing. The difference between the FMR and the actual rent is about $383.76 per month, making it challenging for them to find suitable units without additional financial support. #### Affordability & Renter Profile ZIP code 55119 has a population of 44,567, with 34.6% being renters. This indicates a substantial rental market presence. With an occupancy rate of 96.4%, the market is quite tight, suggesting that there is little excess supply of rental units. The high occupancy rate also implies that there is strong demand for housing in the area, which could contribute to the high rent prices observed. Given the median household income of $81,865, the affordability of housing becomes a critical issue. The price-to-FMR ratio for a two-bedroom unit is 12.4x, meaning that the market price is more than twelve times the FMR. This ratio highlights the severe affordability challenges faced by low-income renters, particularly those relying on Section 8 vouchers. #### Investor Angle From an investor perspective, the ZIP code 55119 presents both opportunities and challenges. The actual median rent for a two-bedroom unit is $1983.76, while the FMR is $1600. If we consider the typical operating costs of a rental property, including mortgage payments, maintenance, utilities, and other expenses, it is unlikely that an investor would achieve positive cash flow solely based on the FMR. To determine the investment grade, we need to look at the potential return on investment (ROI) and the risk associated with renting to Section 8 voucher holders. While the ROI might be lower due to the capped rent, the stability of rental income provided by government-backed vouchers can mitigate some risks. Additionally, the high demand and tight market conditions suggest that properties in this ZIP code will likely have consistent occupancy rates. However, the price-to-FMR ratio of 12.4x indicates that the market is overheated relative to the FMR, which could make it difficult for investors to purchase properties at a price that allows for positive cash flow under the FMR guidelines. This suggests that the investment grade for this ZIP code is moderate to low, given the limited ability to generate profit from rental income alone. #### Specific Actionable Insights 1. **Target Lower-Rent Units**: Investors should focus on acquiring one-bedroom and zero-bedroom units, where the FMR is lower ($1160 for 0BR and $1320 for 1BR). These units are more likely to generate positive cash flow under the Section 8 program, as the gap between market rent and FMR is smaller compared to two-bedroom units. 2. **Consider Cost Reduction Strategies**: To improve cash flow, investors should explore ways to reduce operating costs. This includes efficient property management practices, bulk purchasing of supplies, and leveraging economies of scale if managing multiple properties. Additionally, investors should seek out properties with lower acquisition costs or consider renovation projects that can bring down the effective cost basis. 3. **Diversify Tenant Base**: While focusing on Section 8 tenants, investors should also consider diversifying their tenant base to include non-voucher holders who can pay the higher market rents. This mixed approach can help balance the overall portfolio and provide a buffer against the limitations imposed by the FMR. #### Bottom Line For Section 8-focused investors, ZIP code 55119 presents a challenging environment due to the significant gap between FMR and actual market rents. Given the high price-to-FMR ratio and the tight market conditions, the recommendation is to **Skip** this ZIP code unless you can acquire properties at a significantly discounted price or are willing to manage a mixed tenant portfolio to offset the lower rental income from Section 8 vouchers. The investment grade is considered low, primarily because of the difficulty in achieving positive cash flow under the FMR guidelines.

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.