Location: Redwood County, MN | Metro: Redwood County, MN
| Unit Size | Monthly FMR |
|---|---|
| Studio | $710 |
| 1 Bedroom | $780 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,400 |
| 4 Bedrooms | $1,520 |
| 5 Bedrooms | $1,763 |
| 6 Bedrooms | $1,975 |
| 7 Bedrooms | $2,133 |
| 8 Bedrooms | $2,240 |
U.S. Census Bureau data (2024)
ZIP code 56255, located in Redwood County, MN metro, serves as an ideal diversifier within a Section 8 portfolio strategy. With a significant renter share of 39.4%, this area naturally aligns well with the tenant base of Section 8 properties. The median income of $66,667 suggests that there is a stable population capable of meeting the requirements for housing assistance programs.
The Federal Market Rent (FMR) for the metro area in fiscal year 2026 is set at $970, while the current market rent stands at $683. This indicates a spread of $287 between the FMR and the market rate, making it feasible for landlords to receive sufficient compensation through Section 8 vouchers without overextending their rental prices. Although the median home value is not available, the disparity between the FMR and market rent supports the notion that this ZIP code can provide a steady cash flow for investors.
ZIP 56255 lacks significant indicators for being an appreciation play, as neither the percentage price-cut share nor the days on market (DOM) are provided. However, given the high renter share and the alignment with Section 8 rates, this area is best suited for diversifying a real estate investment portfolio. By including properties in ZIP 56255, investors can balance their holdings with a mix of owner-occupied and rental units, thereby reducing risk and ensuring a broader base of income sources.
To conclude, ZIP 56255 offers a strong foundation for diversification due to its substantial renter population and the favorable relationship between market rents and Section 8 voucher amounts. This makes it a valuable addition to any real estate investment strategy focused on stability and consistent returns.
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.