Location: Faribault County, MN | Metro: Faribault County, MN
| Unit Size | Monthly FMR |
|---|---|
| Studio | $750 |
| 1 Bedroom | $910 |
| 2 Bedrooms | $1,070 |
| 3 Bedrooms | $1,460 |
| 4 Bedrooms | $1,470 |
| 5 Bedrooms | $1,705 |
| 6 Bedrooms | $1,910 |
| 7 Bedrooms | $2,063 |
| 8 Bedrooms | $2,166 |
U.S. Census Bureau data (2024)
The median income in ZIP code 56023 stands at $77,969, which places it within a moderate economic bracket. Considering the market rate for rent at $986 according to Census ACS data, a household in this area can reasonably afford the rent, assuming they allocate around 30% of their income towards housing costs. This makes the rental market accessible to a significant portion of the local population.
When comparing the market rate to the Fair Market Rent (FMR) set by HUD at $970 for metro areas in fiscal year 2026, the difference is minimal. This suggests that landlords who accept Section 8 vouchers are likely to receive rents very close to the market rate, making it a viable option for those looking to participate in government-assisted housing programs.
The ZIP code has a relatively low percentage of renters at 9.5%, indicating that the majority of residents own their homes. Given the total population of 559, the number of renters amounts to approximately 53 individuals. This small number of renters means there is limited competition for rental properties, giving landlords a stronger bargaining position in terms of pricing and tenant selection.
The affordability gap between the median income and the rent market rate is narrow, implying that most households can afford to pay the market rate without assistance. However, for landlords, this means that while voucher recipients might be a smaller pool, they offer a steady and reliable source of income through government subsidies. Accepting vouchers can help fill vacancies in a competitive market, especially when targeting a broader range of tenants.
Landlords should consider both voucher and cash-paying tenants. The choice depends on factors such as vacancy rates, property management preferences, and the desire for long-term versus short-term tenancy. Vouchers provide guaranteed payments and can attract families seeking stable housing, whereas cash-paying tenants often offer greater flexibility and potentially higher rental income. The key takeaway is that landlords in ZIP 56023 have the advantage of choosing the strategy that best suits their investment goals, given the slight overlap between market rates and voucher payments, along with the manageable size of the rental market.
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.