Location: Itasca County, MN | Metro: Itasca County, MN
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 | $710 |
| 1 Bedroom | $810 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,320 |
| 4 Bedrooms | $1,430 |
| 5 Bedrooms | $1,659 |
| 6 Bedrooms | $1,858 |
| 7 Bedrooms | $2,007 |
| 8 Bedrooms | $2,107 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,010 | $300,629 | 0.34% | F |
| 3BR | $1,320 | $374,298 | 0.35% | F |
| 4BR | $1,430 | $496,221 | 0.29% | F |
U.S. Census Bureau data (2024)
In ZIP code 55721, located in Cohasset, Minnesota, there are several potential pitfalls for landlords considering Section 8 investments. Firstly, tenant turnover can be a significant issue due to the disparity between the market rent of $763 and the Fair Market Rent (FMR) of $970 for fiscal year 2026 in the metropolitan area. This difference suggests that tenants might seek higher rental subsidies, leading to frequent moves and high turnover rates.
Vacancy exposure is another concern. The average days on market (DOM) for properties in this area is not available, which makes it difficult to predict how long it might take to fill a vacancy. High vacancy periods can lead to financial strain for landlords who rely on consistent rental income.
The deferred maintenance exposure is also noteworthy. With a typical home value of $336,943 and a median household income of $86,429, many homeowners may struggle to keep up with necessary repairs and maintenance. This can affect the quality of rental units and increase the workload for landlords to maintain property standards required by the Section 8 program.
However, these risks must be weighed against the high renter share in the area, which stands at 13.4%. A significant portion of the population renting indicates strong demand for housing assistance, including Section 8 vouchers. This high renter density typically translates into a robust pool of tenants seeking subsidized housing, potentially offsetting some of the challenges posed by high turnover and vacancy concerns.
In conclusion, the investment risk for a first-time Section 8 landlord in ZIP code 55721 is moderate. While there are considerable risks associated with tenant turnover and vacancy exposure, the strong demand for rental assistance provides a stabilizing factor for the overall investment landscape.
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.