Location: Mower County, MN | Metro: Mower 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 | $780 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,360 |
| 4 Bedrooms | $1,370 |
| 5 Bedrooms | $1,589 |
| 6 Bedrooms | $1,780 |
| 7 Bedrooms | $1,922 |
| 8 Bedrooms | $2,018 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,360 | $288,796 | 0.47% | F |
U.S. Census Bureau data (2024)
Investing in Section 8 properties in ZIP code 55970 comes with several risks that landlords and small-portfolio investors must consider. Firstly, tenant turnover is a significant issue. The market rent of $876 is notably lower than the Fair Market Rent (FMR) of $970, which can lead to higher turnover rates as tenants seek more affordable housing options. This discrepancy in rental rates can result in frequent vacancies and increased administrative costs associated with tenant screening and lease signing.
Vacancy exposure is another concern. The Days on Market (DOM) figure is currently unavailable, indicating potential challenges in accurately assessing the time it might take to fill vacancies. Given the lower market rent compared to FMR, there is a risk that properties may remain vacant for extended periods, especially if the local economy experiences downturns or if other affordable housing options become available.
The deferred maintenance exposure is substantial. With a typical home value of $293,475 and a median income of $85,000, many homeowners may struggle to keep up with necessary repairs and improvements. This could translate into a higher number of properties being ineligible for Section 8 tenancy due to failing inspection standards, thus limiting the pool of available rental units. Landlords will need to be prepared to invest in property maintenance to ensure compliance with HUD regulations.
However, these risks are somewhat offset by the high renter density in the area. The 12.4% renter share suggests a robust demand for rental housing, particularly among those who rely on Section 8 vouchers. A high concentration of renters often correlates with a greater number of individuals seeking subsidized housing, thereby increasing the likelihood of finding qualified tenants quickly.
Verdict: Moderate risk for a first-time Section 8 landlord. While there are notable risks associated with tenant turnover and deferred maintenance, the strong demand for rental housing provides some stability and assurance of occupancy.
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.