Location: Renville County, MN | Metro: Chippewa County, MN
| Unit Size | Monthly FMR |
|---|---|
| Studio | $840 |
| 1 Bedroom | $920 |
| 2 Bedrooms | $1,180 |
| 3 Bedrooms | $1,640 |
| 4 Bedrooms | $1,710 |
| 5 Bedrooms | $1,984 |
| 6 Bedrooms | $2,222 |
| 7 Bedrooms | $2,400 |
| 8 Bedrooms | $2,520 |
U.S. Census Bureau data (2024)
The analysis for the Section 8 program in ZIP code 56260 reveals a significant disparity between the Fair Market Rent (FMR) and the actual market rent. The FMR, set at $970 for the fiscal year 2026, is notably lower than the Census ACS reported market rent of $1,341. This creates a gap of $371 per month, representing a 38.2% difference between the two figures.
Given that the FMR is less than the market rent, landlords and small-portfolio investors should be aware of the potential costs associated with housing voucher tenants at rates below the open-market level. The discrepancy means that landlords might have to absorb the difference between the voucher payment and the market rent, which could impact their overall profitability. Specifically, the $371 monthly shortfall equates to an annual loss of $4,452 per unit if the landlord were to charge the FMR rate instead of the market rate.
To contextualize this further, we must consider the broader economic landscape of ZIP 56260. With 19.6% of residents being renters, the demand for affordable housing is present but limited compared to owner-occupied units. The median home value stands at $314,844, indicating a relatively stable housing market. However, the median income of $75,750 suggests that many residents might struggle to afford market rents, making the Section 8 program a crucial support system for local renters.
In summary, while the Section 8 program can provide a steady stream of rental income, it also comes with the risk of renting properties below the market rate. Landlords need to carefully weigh these factors before deciding to participate, considering both the financial implications and the role they play in providing essential housing services to the community.
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.