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 | $1,520 |
| 1 Bedroom | $1,720 |
| 2 Bedrooms | $2,090 |
| 3 Bedrooms | $2,730 |
| 4 Bedrooms | $3,060 |
| 5 Bedrooms | $3,550 |
| 6 Bedrooms | $3,976 |
| 7 Bedrooms | $4,294 |
| 8 Bedrooms | $4,509 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,090 | $339,088 | 0.62% | D |
| 3BR | $2,730 | $379,291 | 0.72% | D |
| 4BR | $3,060 | $426,904 | 0.72% | D |
| 5BR | $3,550 | $461,711 | 0.77% | D |
U.S. Census Bureau data (2024)
Bloomington, MN's ZIP code 55431 is characterized by a substantial population of 18,664 residents, with 32.6% of them being renters. The area boasts a median household income of $101,484, indicating a relatively affluent community. Median home values stand at $376,120, reflecting the high cost of living and property ownership in this part of Bloomington.
The rental market in ZIP 55431 is particularly interesting when considering the Federal Market Rent (FMR) and the Zillow Observed Rental Index (ZORI). For fiscal year 2024, the FMR is set at $1,960, which is notably higher than the current market rent of $1,744 as indicated by ZORI. This discrepancy suggests that properties participating in the Section 8 program can command higher rents compared to the average market rate, potentially offering better financial returns for landlords.
Given these economic conditions, ZIP 55431 could be well-suited for both hands-off voucher operators and hands-on value-add buyers. The higher FMR provides a stable and predictable income stream for hands-off operators, while the lower market rent offers an opportunity for value-add buyers to improve properties and increase their rental value closer to the FMR. In conclusion, the combination of a strong local economy and favorable rent dynamics makes ZIP 55431 a promising investment location for Section 8 landlords and small-portfolio investors.
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.