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 | $1,690 |
| 1 Bedroom | $1,900 |
| 2 Bedrooms | $2,310 |
| 3 Bedrooms | $3,020 |
| 4 Bedrooms | $3,380 |
| 5 Bedrooms | $3,921 |
| 6 Bedrooms | $4,392 |
| 7 Bedrooms | $4,743 |
| 8 Bedrooms | $4,980 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,310 | $317,281 | 0.73% | D |
| 3BR | $3,020 | $402,661 | 0.75% | D |
| 4BR | $3,380 | $582,531 | 0.58% | F |
| 5BR | $3,921 | $676,234 | 0.58% | F |
U.S. Census Bureau data (2024)
The potential risks for investing in Section 8 housing in ZIP code 55129 in Woodbury, MN, are significant but manageable. First, consider the issue of tenant turnover. The market rent for properties in this area is currently set at $2,341, while the Fair Market Rent (FMR) for fiscal year 2024 is $2,410. This slight discrepancy can lead to higher turnover rates as tenants may seek out properties that offer a closer match to the FMR. High turnover is costly, with expenses often exceeding $2,341 per unit due to the need for cleaning, repairs, and advertising.
Vacancy exposure is another concern. With an average Days on Market (DOM) of 59 days, landlords face a period where their property may be unoccupied and not generating income. In a competitive rental market, this delay can translate into lost revenue and increased costs. Additionally, the typical home value in ZIP 55129 is around $533,017, which is considerably higher than the median household income of $143,795. This gap suggests that many residents might struggle with additional maintenance costs, leading to deferred maintenance issues that could escalate into more serious and expensive repairs over time.
However, these risks must be weighed against the substantial number of renters in the area. ZIP 55129 has a 22.3% renter share, indicating a dense population of potential tenants, including those who rely on Section 8 vouchers. High renter density typically correlates with greater demand for subsidized housing, which can help mitigate the risks associated with vacancy and turnover. Landlords can benefit from the steady stream of qualified applicants looking for affordable housing options.
In conclusion, the investment risk for a first-time Section 8 landlord in ZIP 55129 is moderate.
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.