Location: Nobles County, MN | Metro: Cottonwood County, MN
| Unit Size | Monthly FMR |
|---|---|
| Studio | $710 |
| 1 Bedroom | $910 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,350 |
| 4 Bedrooms | $1,360 |
| 5 Bedrooms | $1,578 |
| 6 Bedrooms | $1,767 |
| 7 Bedrooms | $1,908 |
| 8 Bedrooms | $2,003 |
U.S. Census Bureau data (2024)
The ZIP code 56137 is situated in a rural neighborhood with a total population of 1,039. It is characterized by a modest rental market, with only 17.4% of residents being renters. The median household income here is $71,250, indicating a middle-class community. The median home value stands at $189,108, which reflects the general affordability of the area.
Moving into the economic analysis of renting in ZIP 56137, the Fair Market Rent (FMR) set by HUD for the metro area for fiscal year 2026 is $970. However, the actual market rent, as per Census ACS data, is lower at $830. This discrepancy suggests that landlords in this area can potentially increase their rents closer to the FMR without significantly impacting occupancy rates, given the relatively low percentage of renters and the modest median income.
Considering these factors, ZIP 56137 might be better suited for a hands-on value-add buyer rather than a hands-off voucher operator. With a smaller rental market and a gap between the FMR and current market rents, there is an opportunity for active management to improve property values and rental incomes. A hands-on approach would allow investors to capitalize on the potential for increased rental rates and to address any issues that could arise in a less densely populated area where competition for tenants is not as fierce.
In summary, the rural character of ZIP 56137, combined with its economic profile, points towards a niche market that requires careful consideration. For investors looking to maximize returns through active property management, this ZIP code presents a viable option. However, those seeking a passive investment strategy focused solely on Section 8 vouchers should look elsewhere for higher density areas with a larger proportion of renters.
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.