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 | $1,560 |
| 1 Bedroom | $1,760 |
| 2 Bedrooms | $2,140 |
| 3 Bedrooms | $2,790 |
| 4 Bedrooms | $3,130 |
| 5 Bedrooms | $3,631 |
| 6 Bedrooms | $4,067 |
| 7 Bedrooms | $4,392 |
| 8 Bedrooms | $4,612 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,760 | $223,013 | 0.79% | D |
| 2BR | $2,140 | $280,087 | 0.76% | D |
| 3BR | $2,790 | $433,693 | 0.64% | D |
| 4BR | $3,130 | $616,339 | 0.51% | F |
| 5BR | $3,631 | $833,786 | 0.44% | F |
U.S. Census Bureau data (2024)
The economics of Section 8 housing in ZIP code 55317, which includes Chanhassen, MN, in Carver County, revolve around the SAFMR (Small Area Fair Market Rent) rates established by the U.S. Department of Housing and Urban Development (HUD). For a two-bedroom apartment in this ZIP code, the SAFMR for fiscal year 2024 is set at $2000. This figure is specifically tailored to reflect the rental conditions unique to this ZIP code, ensuring it accurately represents the local housing market.
In contrast, the local market rent for a two-bedroom unit in ZIP 55317, as measured by Zillow's ZORI (Zillow Observed Rent Index), is currently at $2,150. This indicates that the market rent slightly exceeds the SAFMR rate, suggesting that landlords might face a small shortfall if they rely solely on the Section 8 voucher program to cover their rental costs.
To understand the actual payment a landlord receives from a Section 8 voucher, consider the following components:
The tenant is responsible for paying approximately 30% of their adjusted income towards rent. If we assume an average adjusted income for tenants in this area, the tenant portion would be calculated accordingly. However, without specific income data, we can focus on the total reimbursement aspect.
Housing authorities also provide utility allowances based on the size of the unit and local utility costs. These allowances are designed to help cover the cost of utilities for the tenant, but they do not directly affect the landlord's rent reimbursement.
The typical reimbursement for a landlord under the Section 8 program in ZIP 55317 will be capped at the SAFMR rate of $2000, regardless of the tenant's individual contribution. Therefore, even though the local market rent is higher at $2,150, the landlord will receive no more than the SAFMR amount for a two-bedroom unit.
This results in a reimbursement gap of $150 per month for landlords renting out a two-bedroom unit at the market rate. In essence, landlords who participate in the Section 8 program in this ZIP code will receive less than the market rent, which must be considered when deciding whether to accept Section 8 vouchers for their properties.
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.