Location: Martin County, MN | Metro: Faribault 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 | $730 |
| 1 Bedroom | $890 |
| 2 Bedrooms | $1,050 |
| 3 Bedrooms | $1,440 |
| 4 Bedrooms | $1,440 |
| 5 Bedrooms | $1,670 |
| 6 Bedrooms | $1,870 |
| 7 Bedrooms | $2,020 |
| 8 Bedrooms | $2,121 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,050 | $145,946 | 0.72% | D |
| 3BR | $1,440 | $191,912 | 0.75% | D |
U.S. Census Bureau data (2024)
ZIP 56098, located in Winnebago, MN, within the Martin County area of the MN metro, serves as an ideal cash-flow anchor for a Section 8 portfolio strategy. The Federal Market Rent (FMR) for the MN metro area in fiscal year 2026 is set at $990, which is significantly higher than the local market rent of $733. This creates a strong positive spread, ensuring that properties in this ZIP code can be rented out at Section 8 rates without financial loss.
The median home value in ZIP 56098 stands at $173,067, making it affordable for investors looking to enter the market without the need for large capital investments. The positive cash flow generated by the difference between the FMR and market rent can be used to cover mortgage payments, maintenance costs, and other operational expenses, providing a solid foundation for a landlord's investment portfolio.
Although the ZIP code does not present significant opportunities for appreciation, given the lack of data on price-cut shares and days on market (DOM), it remains a reliable choice for those seeking steady rental income. The 22.5% renter share indicates a moderate demand for rental properties, while the median income of $69,000 suggests that tenants are likely to have stable employment and be able to meet their rent obligations consistently.
In summary, ZIP 56098 should be considered a cash-flow anchor within a Section 8 portfolio strategy due to the substantial spread between the FMR and market rent, coupled with the affordable median home value. This ensures that landlords can achieve financial stability and predictability from their investments in this area.
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.