Location: Cottonwood County, MN | Metro: Cottonwood County, MN
| Unit Size | Monthly FMR |
|---|---|
| Studio | $860 |
| 1 Bedroom | $960 |
| 2 Bedrooms | $1,180 |
| 3 Bedrooms | $1,630 |
| 4 Bedrooms | $1,720 |
| 5 Bedrooms | $1,995 |
| 6 Bedrooms | $2,234 |
| 7 Bedrooms | $2,413 |
| 8 Bedrooms | $2,534 |
U.S. Census Bureau data (2024)
The analysis of ZIP code 56174 reveals a market that is moderately positioned between high-yield and steady-cashflow zones, leaning slightly towards high-yield due to specific financial metrics.
Firstly, examining the yield aspect, the Fair Market Rent (FMR) for the metro area in fiscal year 2026 stands at $1,150. This figure represents the rental price benchmark for the region, indicating a relatively strong demand for rental properties. In comparison, the market rent is $979, suggesting that landlords can potentially achieve higher yields by renting at or near the FMR. The absence of a home value figure (N/A) implies that there might be limited opportunities for flipping properties in this area, as the data does not support an assessment of the potential profit margins from buying and selling homes.
Moving on to stability, the ZIP code has a 27.0% rental rate, which is a significant portion of the housing market but also indicates a substantial number of homeowners who may have different priorities and behaviors compared to renters. The median income of $74,688 suggests that residents have reasonable purchasing power, which could contribute to overall market stability. However, the lack of data regarding the average days on market (DOM) for rental listings introduces uncertainty about how quickly properties can be leased, which is crucial for assessing cash flow reliability.
In summary, ZIP 56174 presents a scenario where the potential for higher yields exists due to the disparity between FMR and market rents, yet the stability of cash flows is somewhat compromised by the limited data on DOM and the mixed presence of renters and homeowners. This makes it a market with moderate stability and higher yield potential, suitable for landlords and small-portfolio investors looking to capitalize on rental rates while being aware of the risks associated with less comprehensive market data.
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.