Location: Freeborn County, MN | Metro: Freeborn County, MN
| Unit Size | Monthly FMR |
|---|---|
| Studio | $710 |
| 1 Bedroom | $780 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,340 |
| 4 Bedrooms | $1,540 |
| 5 Bedrooms | $1,786 |
| 6 Bedrooms | $2,000 |
| 7 Bedrooms | $2,160 |
| 8 Bedrooms | $2,268 |
U.S. Census Bureau data (2024)
ZIP code 56089, located in Freeborn County, MN metro, is best suited as a cash-flow anchor within a Section 8 portfolio strategy. The Federal Market Rent (FMR) for the area is set at $970 for fiscal year 2026, which significantly exceeds the current market rent of $571. This creates a spread of $400 per unit, offering a substantial buffer against potential increases in operating costs and ensuring steady cash flow.
The median home value in ZIP 56089 is currently not available, indicating that this area might be less focused on homeownership compared to other regions. With a renter share of 17.4%, it suggests a moderate demand for rental properties, particularly those that qualify under the Section 8 program. Landlords can leverage this by securing long-term, stable tenants through the voucher program, minimizing vacancy rates and turnover costs.
The median income of $56,250 in the area aligns well with the income eligibility requirements for Section 8 housing, making it a viable market for the program. However, due to the lack of data on price-cut share and days on market (DOM), it's challenging to assess this ZIP code purely as an appreciation play. Instead, the focus should remain on the guaranteed rental income provided by the Section 8 program, which can serve as a reliable foundation for a landlord's investment strategy.
In summary, ZIP 56089 offers a strong case for being a cash-flow anchor in a Section 8 portfolio. The significant spread between the FMR and market rent ensures a steady stream of income, while the moderate renter share and median income level support a stable tenant base. This makes it an excellent choice for landlords and small-portfolio investors looking to secure predictable returns.
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.