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 | $1,360 |
| 1 Bedroom | $1,540 |
| 2 Bedrooms | $1,870 |
| 3 Bedrooms | $2,440 |
| 4 Bedrooms | $2,740 |
| 5 Bedrooms | $3,178 |
| 6 Bedrooms | $3,559 |
| 7 Bedrooms | $3,844 |
| 8 Bedrooms | $4,036 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,540 | $155,788 | 0.99% | C |
| 2BR | $1,870 | $253,757 | 0.74% | D |
| 3BR | $2,440 | $446,833 | 0.55% | F |
| 4BR | $2,740 | $568,204 | 0.48% | F |
| 5BR | $3,178 | $696,361 | 0.46% | F |
U.S. Census Bureau data (2024)
The rent math in ZIP code 55438, located in Bloomington, Minnesota, does not work favorably for landlords participating in the Section 8 program. The Fair Market Rent (FMR) set by HUD for fiscal year 2024 is $1860, whereas the market rent (ZORI) stands at $1675. This discrepancy means that landlords could be renting properties below the market rate if they rely solely on the FMR.
Acquisition in this area is relatively affordable. With a median home value of $403,504, the market indicates that homes are not overpriced. Furthermore, the average Days on Market (DOM) of 40 days and a mere 0.1% share of homes experiencing price cuts suggest that the housing market is stable and that homes are selling quickly without significant discounts.
Tenant demand in ZIP 55438 is robust. The population of 15,701 residents includes a notable 21.2% who are renters. This percentage translates to a substantial number of potential tenants looking for rental properties, indicating strong demand for rentals in the area.
In conclusion, while the rent math presents a challenge due to the lower FMR compared to market rents, the affordability of acquisitions and strong tenant demand make ZIP 55438 a viable option for landlords and small-portfolio investors willing to navigate the financial intricacies of the Section 8 program. The stable housing market and quick sales indicate that investment in this area can be profitable if managed correctly.
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.