Location: Lake County, MN | Metro: Duluth, MN-WI MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $800 |
| 1 Bedroom | $890 |
| 2 Bedrooms | $1,150 |
| 3 Bedrooms | $1,530 |
| 4 Bedrooms | $1,870 |
| 5 Bedrooms | $2,169 |
| 6 Bedrooms | $2,429 |
| 7 Bedrooms | $2,623 |
| 8 Bedrooms | $2,754 |
U.S. Census Bureau data (2024)
The ZIP code 55796 presents a unique opportunity for real-estate investors, particularly those interested in Section 8 properties. The Fair Market Rent (FMR) for the area in fiscal year 2024 is set at $1,120. This figure stands notably above the local market rent of $638, indicating a high-yield potential for investors who can secure Section 8 tenants. However, it's important to note that there is no available data for home values, which suggests that traditional investment metrics might be less informative here.
Stability in this market is a mixed bag. With only 17.3% of residents being renters, the demand for rental properties is relatively low. This could translate into lower occupancy rates and higher vacancy periods, which negatively impacts cash flow stability. The lack of data on days-on-market (DOM) further complicates the assessment of how quickly properties can be leased, but given the low percentage of renters, we can infer that the market may not be as fluid as other areas with higher rental populations.
Economic stability is another critical factor. The median household income in ZIP 55796 is $52,344, which is an average figure and doesn't necessarily indicate economic robustness. It's essential to consider how this income level supports the ability of residents to afford the local rents, especially the higher FMR rates associated with Section 8 properties.
Based on these figures, ZIP 55796 appears to be a market that leans towards high-yield but with low stability. The significant gap between the FMR and market rent suggests that properties with Section 8 tenants can command higher rents, thus offering greater yields. However, the low percentage of renters indicates that finding and maintaining tenants could be challenging, leading to less stable cash flows. For landlords and small-portfolio investors looking to maximize returns, this ZIP code offers a high-reward scenario, albeit with increased risk due to the potentially volatile tenant acquisition process.
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.