Location: Watonwan County, MN | Metro: Cottonwood 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 | $760 |
| 1 Bedroom | $850 |
| 2 Bedrooms | $1,050 |
| 3 Bedrooms | $1,450 |
| 4 Bedrooms | $1,530 |
| 5 Bedrooms | $1,775 |
| 6 Bedrooms | $1,988 |
| 7 Bedrooms | $2,147 |
| 8 Bedrooms | $2,254 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,450 | $157,391 | 0.92% | C |
U.S. Census Bureau data (2024)
The ZIP code 56159, with a population of 2,668, has 23.6% of its residents as renters. This indicates that it is not heavily dominated by renters but rather has a moderate rental presence. The median household income in this area stands at $71,648, which provides a benchmark for assessing the affordability of rents.
The average market rent in ZIP 56159 is $921 per month. To understand the financial burden this represents, we can calculate the percentage of the median income that goes towards rent. With an annual income of $71,648, the monthly equivalent is approximately $5,970. Therefore, the $921 market rent consumes about 15.4% of the monthly median income. This is relatively affordable compared to national standards, where rent often eats up a larger portion of income.
Furthermore, the Fair Market Rent (FMR) for the area, set at $980 for fiscal year 2026, aligns closely with the current market rent. This suggests that landlords in ZIP 56159 can expect a reasonable level of support from Section 8 vouchers, given the proximity of the FMR to actual market rates. However, the relatively low percentage of renters in the area implies that while there is some demand for voucher-supported tenants, it is not overwhelming.
The typical tenant profile for landlords in this ZIP code would be individuals or families who benefit from the Section 8 program. These tenants are likely to have incomes that fall below the median, making the voucher assistance necessary to afford the average rent. Landlords should anticipate tenants who are responsible and committed to maintaining their housing, given the support they receive from the government. While the demand for Section 8 vouchers is present, it is important for landlords to consider the broader context of the ZIP code's demographics and rental market dynamics when deciding on accepting tenants with vouchers.
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.