Location: Mankato, MN | Metro: Mankato, MN MSA
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 | $880 |
| 1 Bedroom | $890 |
| 2 Bedrooms | $1,070 |
| 3 Bedrooms | $1,480 |
| 4 Bedrooms | $1,730 |
| 5 Bedrooms | $2,007 |
| 6 Bedrooms | $2,248 |
| 7 Bedrooms | $2,428 |
| 8 Bedrooms | $2,549 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,480 | $285,248 | 0.52% | F |
U.S. Census Bureau data (2024)
The median income in ZIP code 56034 stands at $98,750, which provides some insight into the financial capabilities of the local households. The market rate for rent, according to the Census ACS, is $1,125. This means that even with the median income, a household would need to allocate approximately 23% of their monthly earnings towards rent, assuming they follow the general guideline of spending no more than 30% of income on housing.
In contrast, the Federal Market Rent (FMR) for ZIP code 56034 in fiscal year 2024 is set at $1,000. This figure represents the amount that Section 8 vouchers will cover for rental units in this area, which is below the market rate of $1,125. Therefore, tenants using Section 8 vouchers will have an additional $125 per month to contribute towards rent, making up the difference between the voucher payment and the market rate.
The ZIP code has a relatively low percentage of renters at 15.1%, with a total population of 393. Given these numbers, the competition among landlords for rental properties may be less intense compared to areas with higher percentages of renters. However, the affordability gap, where the market rate exceeds the voucher payment, can influence the decision-making process for both landlords and potential tenants.
Landlords considering whether to accept Section 8 vouchers or focus on cash-paying tenants should weigh the benefits and drawbacks of each strategy. Accepting vouchers ensures a steady stream of rental income guaranteed by the government, though it comes at a fixed rate that may be lower than the market rate. On the other hand, cash-paying tenants might offer higher rents but also come with the risk of non-payment and the need for thorough credit checks.
The takeaway for landlords is that while the voucher payment of $1,000 is below the market rate of $1,125, the additional contribution from tenants can still make it a viable option. The lower competition in the rental market might mean that landlords who are flexible with their acceptance of Section 8 vouchers could attract a stable tenant base. Landlords should consider the overall financial landscape and the specific needs of their property management when deciding their rental strategy.
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.