Location: Minneapolis-St. Paul-Bloomington, MN | Metro: Minneapolis-St. Paul-Bloomington, MN-WI HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,670 |
| 1 Bedroom | $1,880 |
| 2 Bedrooms | $2,290 |
| 3 Bedrooms | $2,990 |
| 4 Bedrooms | $3,350 |
| 5 Bedrooms | $3,886 |
| 6 Bedrooms | $4,352 |
| 7 Bedrooms | $4,700 |
| 8 Bedrooms | $4,935 |
U.S. Census Bureau data (2024)
To determine if you should buy in ZIP code 55424 (Edina, MN) for Section 8 purposes, follow these steps:
Step 1: Can the Fair Market Rent (FMR) of $2050 cover the debt service on a property costing $1,012,386?
No. The FMR of $2050 is insufficient to cover the typical debt service on a property valued at $1,012,386. Debt service for such a high-value property would likely exceed the FMR amount, making it financially unfeasible to rely solely on Section 8 tenants to meet your mortgage obligations.
Yes. This scenario is unlikely given the property value and FMR. However, if your property's debt service is exceptionally low, then it might be feasible. But this is not a common situation in Edina, MN.
It Depends. If you have an unusually low debt service due to a high down payment or other factors, it could be feasible. Otherwise, the FMR does not typically cover the costs associated with a property of this value.
Step 2: How does the market rent ($2,795 ZORI) compare to the FMR?
Market Rent Above FMR. The ZORI (median estimated rent) of $2,795 is significantly higher than the FMR of $2050. This means that landlords will generally find it more profitable to rent to market-rate tenants rather than those covered under Section 8.
Market Rent Equal to FMR. This is not the case in Edina, MN. The ZORI is well above the FMR, indicating that there is little to no overlap where the FMR meets the market rent.
Market Rent Below FMR. This is also not applicable in Edina, MN. Given the high ZORI, landlords can expect to receive higher rents than the FMR.
Step 3: Is there sufficient demand for Section 8 tenants?
Yes. With 8.5% of the population being renters, there is some demand for rental properties. However, the demand is not particularly high, and the "N/A" for days on market (DOM) suggests limited data on how quickly properties are rented out.
No. While there is some rental demand, the percentage of renters is relatively low, and without concrete data on DOM, it's challenging to assess the strength of the demand for Section 8 tenants specifically.
It Depends. The 8.5% of renters indicates moderate demand, but the lack of DOM data makes it uncertain whether this demand is strong enough to support Section 8 rentals. Consider local trends and consult with local real estate agents for more detailed insights.
In conclusion, purchasing a property in ZIP 55424 for Section 8 purposes is generally not recommended due to the high cost of debt service relative to the FMR and the higher market rents available. However, if you can manage the debt service effectively or if you're interested in the rental market despite the low FMR, further investigation into local demand and specific property conditions is advised.
Data Sources: FMR data from HUD (2027). 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.