Location: Meeker County, 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 | $1,120 |
| 1 Bedroom | $1,270 |
| 2 Bedrooms | $1,540 |
| 3 Bedrooms | $2,040 |
| 4 Bedrooms | $2,280 |
| 5 Bedrooms | $2,645 |
| 6 Bedrooms | $2,962 |
| 7 Bedrooms | $3,199 |
| 8 Bedrooms | $3,359 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,540 | $262,655 | 0.59% | F |
| 3BR | $2,040 | $322,350 | 0.63% | D |
| 4BR | $2,280 | $378,025 | 0.6% | D |
| 5BR | $2,645 | $462,762 | 0.57% | F |
U.S. Census Bureau data (2024)
The median income in ZIP code 55321, which includes Cokato, Minnesota, stands at $80,433. This figure provides a benchmark for assessing the affordability of housing in the area. The current market rate for rent, according to Census ACS data, is $869 per month. However, when considering the Federal Market Rent (FMR) standard for ZIP 55321 in fiscal year 2024, which is set at $1,270, it becomes evident that there is a significant disparity between what the average household earns and what they might be required to pay through a voucher program.
To put this into perspective, a household earning the median income would spend approximately 13% of their monthly income on the market rate rent of $869. In contrast, if relying on a voucher that pays up to $1,270, they would need to cover the difference themselves, making it a much less affordable option. The fact that only 21.4% of the 5,646 residents are renters also suggests a relatively low demand for rental properties compared to owner-occupied homes.
The affordability gap has direct implications for landlord competition. Given that the majority of households are likely to prefer the market rate rent over the higher FMR standard, landlords who accept vouchers may face challenges in finding tenants willing to bridge the financial gap. This scenario could lead to increased vacancy rates for landlords who exclusively cater to voucher recipients.
Takeaway: For landlords and small-portfolio investors in ZIP 55321, focusing on attracting cash-paying tenants who align with the local market rate of $869 could prove more effective. While accepting vouchers can provide a steady stream of income, the requirement for tenants to contribute additional funds beyond what the voucher covers may deter potential renters in an area where the median income is already tight. Balancing both voucher and cash-paying tenant strategies might be the most prudent approach, but prioritizing market rate rents is advisable given the local economic conditions.
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.