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 | $1,290 |
| 1 Bedroom | $1,460 |
| 2 Bedrooms | $1,770 |
| 3 Bedrooms | $2,310 |
| 4 Bedrooms | $2,590 |
| 5 Bedrooms | $3,004 |
| 6 Bedrooms | $3,364 |
| 7 Bedrooms | $3,633 |
| 8 Bedrooms | $3,815 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,460 | $192,128 | 0.76% | D |
| 2BR | $1,770 | $248,235 | 0.71% | D |
| 3BR | $2,310 | $360,013 | 0.64% | D |
| 4BR | $2,590 | $416,263 | 0.62% | D |
| 5BR | $3,004 | $442,565 | 0.68% | D |
U.S. Census Bureau data (2024)
The Section 8 housing market in ZIP code 55128, located in Oakdale, Minnesota within the Minneapolis-St. Paul-Bloomington metropolitan area, presents a mixed landscape for landlords and small-portfolio investors. The HUD Fair Market Rent (FMR) for the region is set at $1,570 for the fiscal year 2024. In comparison, the Zillow Observed Rent Index (ZORI), which reflects the actual market rent, stands at $1,785. This indicates that voucher tenants would typically generate a marginal cash flow at the HUD FMR rate, requiring landlords to either accept slightly lower returns or seek out higher-end units to achieve positive cash flow.
To further analyze the investment potential, consider the median home value in the area, which is $353,744. Using this figure, we can calculate a rent-to-price ratio. With an average rent of $1,785, the annual rent comes to approximately $21,420. Dividing this by the median home value yields a rent-to-price ratio of roughly 6%, suggesting that rental properties are priced moderately relative to their income-generating capacity.
Regarding the rental versus buying dynamics, the median Days on Market (DOM) is listed as N/A, and the percentage of listings making price cuts is a mere 0.2%. These figures imply a stable market where rental properties are generally sought after and do not require significant price adjustments, indicating strong demand for rentals over homeownership in this area.
The strongest investor angle in ZIP 55128 is likely to be stability. Given the consistent demand for rentals and the minimal need for price reductions, investors can expect reliable, steady cash flows with limited risk of vacancy or rent default. While the cash flow might be marginal when compared to the HUD FMR, the stability and predictability of the market make it a solid choice for those looking for a dependable investment.
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.