Location: Martin County, MN | Metro: Martin 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 | $840 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,340 |
| 4 Bedrooms | $1,340 |
| 5 Bedrooms | $1,554 |
| 6 Bedrooms | $1,740 |
| 7 Bedrooms | $1,879 |
| 8 Bedrooms | $1,973 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $840 | $89,735 | 0.94% | C |
| 2BR | $1,010 | $129,152 | 0.78% | D |
| 3BR | $1,340 | $192,608 | 0.7% | D |
| 4BR | $1,340 | $281,642 | 0.48% | F |
| 5BR | $1,554 | $358,745 | 0.43% | F |
U.S. Census Bureau data (2024)
The Section 8 program in Fairmont, Minnesota, specifically ZIP code 56031, presents a significant opportunity for landlords and small-portfolio investors due to the disparity between the Fair Market Rent (FMR) and the actual market rent. The FMR for the metro area in fiscal year 2026 is set at $970, while the Census ACS data indicates that the average market rent is $739. This creates a gap of $231 per month, representing a 29.7% difference.
Given that the FMR exceeds the market rent, it is evident that voucher tenants can significantly enhance rental yields. Landlords who participate in the Section 8 program can expect to receive a higher monthly rent payment, which is closer to the FMR figure, thus increasing their profitability. With 36.2% of residents being renters, there is a substantial demand for affordable housing in Fairmont. Additionally, the median home value stands at $192,692, indicating that homeownership is not within reach for all residents, further underscoring the importance of rental properties.
The median income in Fairmont is $54,847, which suggests that many residents rely on rental assistance programs such as Section 8 to secure housing. By participating in the program, landlords can tap into a reliable source of rental income, as the government guarantees timely payments. Moreover, the lower market rent of $739 compared to the FMR means that landlords can still offer competitive pricing to attract tenants without sacrificing profitability.
In conclusion, the gap between the FMR and market rent in ZIP 56031 makes it an attractive investment for landlords and small-portfolio investors looking to maximize their returns. The Section 8 program provides a stable income stream, aligning with the local economic conditions where affordability is a key concern for many residents. Therefore, landlords should consider enrolling in the Section 8 program to benefit from the increased rental yields while providing much-needed affordable housing options.
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.