Location: Freeborn County, MN | Metro: Freeborn County, MN
| Unit Size | Monthly FMR |
|---|---|
| Studio | $890 |
| 1 Bedroom | $980 |
| 2 Bedrooms | $1,280 |
| 3 Bedrooms | $1,680 |
| 4 Bedrooms | $1,930 |
| 5 Bedrooms | $2,239 |
| 6 Bedrooms | $2,508 |
| 7 Bedrooms | $2,709 |
| 8 Bedrooms | $2,844 |
U.S. Census Bureau data (2024)
ZIP code 56032, located in Freeborn County, MN, serves as a cash-flow anchor within a Section 8 portfolio strategy. The Federal Market Rent (FMR) for the metro area in fiscal year 2026 is set at $1,320. This figure stands significantly above the local market rent of $820, providing a substantial cushion for landlords participating in the program. The median home value in this ZIP is $135,951, indicating a relatively affordable housing market that benefits from the guaranteed rental income provided by Section 8.
The spread between the FMR and the market rent is $500 per unit, which ensures that landlords can cover their costs and generate a profit even if market rents were to fall. This makes ZIP 56032 an attractive option for those looking to stabilize their cash flow. Additionally, the guaranteed tenants through the Section 8 program reduce the risk of vacancies, further enhancing the reliability of income streams.
While there are no specific percentages given for price-cut shares or days on market (DOM), the lack of these figures suggests stability in the housing market. Stability is crucial for a cash-flow anchor, as it minimizes the volatility associated with fluctuating rents and property values.
The 16.7% renter share and median income of $50,000 indicate that a portion of the population is likely to be reliant on government assistance for housing. This aligns well with the Section 8 program's goal of providing affordable housing options to low-income families. However, these factors do not suggest significant potential for property appreciation or serve as a primary driver for diversification within a real estate portfolio.
In summary, ZIP 56032 is best suited as a cash-flow anchor due to the favorable spread between FMR and market rent, combined with a stable housing market and the presence of a tenant base that benefits from Section 8 subsidies. Landlords and small-portfolio investors should consider this ZIP code for its ability to provide consistent and reliable rental income.
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.