Location: Duluth, MN | Metro: Duluth, MN-WI MSA
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 | $860 |
| 1 Bedroom | $980 |
| 2 Bedrooms | $1,230 |
| 3 Bedrooms | $1,700 |
| 4 Bedrooms | $2,060 |
| 5 Bedrooms | $2,390 |
| 6 Bedrooms | $2,677 |
| 7 Bedrooms | $2,891 |
| 8 Bedrooms | $3,036 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,230 | $238,488 | 0.52% | F |
| 3BR | $1,700 | $338,255 | 0.5% | F |
U.S. Census Bureau data (2024)
The market analysis for Section 8 investors in ZIP code 55724, located in Cotton, Minnesota, within Saint Louis County and the Duluth, MN-WI MSA, reveals several key points regarding rental income and property investment.
The HUD Fair Market Rent (FMR) for ZIP 55724 in fiscal year 2024 is set at $1120. This figure represents the maximum amount that voucher holders can pay towards their rent. However, due to the lack of current market rent data, it's challenging to directly compare the HUD FMR with local rental rates. Nonetheless, based on the available information, voucher tenants would likely cashflow at FMR levels, given the absence of evidence suggesting higher market rents.
The median home value in ZIP 55724 is $212,931. Using this figure, we can calculate the rent-to-price ratio, which provides insight into the relative affordability of renting versus buying. The rent-to-price ratio, derived from the HUD FMR, is approximately 6.67%. This suggests that rental properties in this area are relatively affordable compared to the cost of purchasing a home, making them attractive for both short-term cashflow and long-term investment strategies.
While the day-to-market (DOM) and price-cut share percentages are not available, these metrics typically influence the rent-versus-buy decision. In ZIP 55724, the stability of the housing market appears to be a strong point, as evidenced by the consistent median home value over recent years. This stability indicates that the area is less prone to rapid fluctuations in rental demand and pricing, offering a reliable environment for investors.
The strongest angle for investors in ZIP 55724 is stability. With a predictable rental income and a stable housing market, investors can expect consistent returns and minimal risk, making this area ideal for those seeking a safe haven for their real estate investments.
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.