Section 8 Fair Market Rent (FMR) for ZIP 56212 - 2027

Location: Lac qui Parle County, MN | Metro: Lac qui Parle County, MN

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$710
1 Bedroom	$840
2 Bedrooms	$1,010
3 Bedrooms	$1,410
4 Bedrooms	$1,490
5 Bedrooms	$1,728
6 Bedrooms	$1,935
7 Bedrooms	$2,090
8 Bedrooms	$2,195

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

Population

475

Median Household Income

$81,250

Housing Units

286

Renter Percentage

10.2%

Occupancy Rate

78.7%

Renter Occupied

The classification of ZIP code 56212 hinges on its yield and stability metrics. With a Fair Market Rent (FMR) of $970 for the fiscal year 2026, compared to a market rent of $506, it's evident that this area offers a significant yield advantage when considering rental properties over homeownership. The FMR figure indicates the potential for higher rental income, which can be a strong draw for landlords and small-portfolio investors.

However, the stability of the market must also be considered. Only 10.2% of the residents are renters, which suggests a relatively low demand for rental properties. This could translate into less consistent cash flow, as there might be periods where finding tenants is challenging. Additionally, the average household income is $81,250, which provides some insight into the economic stability of the area but does not directly correlate to rental demand or property turnover rates.

The absence of data regarding the number of days on market (DOM) for rental listings adds uncertainty to the analysis. Typically, a lower DOM would indicate a more stable market where properties are quickly occupied, whereas a higher DOM might suggest instability or difficulty in securing tenants.

Given these figures, ZIP 56212 leans towards being a high-yield/low-stability market. The substantial difference between the FMR and market rent ($970 vs $506) points to a high-yield potential, especially if the landlord can attract tenants willing to pay closer to the FMR. However, the low percentage of renters (10.2%) implies that the market is not highly stable, and securing consistent tenancy may require active management and possibly lower pricing to match market conditions.

To capitalize on this market, landlords should consider the following:

Targeting specific demographics: Given the higher income levels, targeting professionals or families who prefer renting over buying could be beneficial.
Offering competitive rents: While the FMR is high, setting rents closer to the market rate of $506 could help in attracting tenants faster and maintaining occupancy.
Active property management: Due to the low percentage of renters, proactive measures to maintain tenant relationships and manage turnovers will be crucial.

In conclusion, ZIP 56212 presents an opportunity for high yields but requires careful consideration of market dynamics and possibly a shift towards more active management practices to ensure stability.

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.