Location: Swift County, MN | Metro: Kandiyohi County, MN
| Unit Size | Monthly FMR |
|---|---|
| Studio | $800 |
| 1 Bedroom | $830 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,410 |
| 4 Bedrooms | $1,660 |
| 5 Bedrooms | $1,926 |
| 6 Bedrooms | $2,157 |
| 7 Bedrooms | $2,330 |
| 8 Bedrooms | $2,447 |
U.S. Census Bureau data (2024)
The classification of ZIP code 56289 hinges on its financial metrics, particularly focusing on yield and stability. The Federal Market Rent (FMR) for the metro area in fiscal year 2026 stands at $970, while the market rent is lower at $788. This suggests a rental environment where properties can potentially command higher rents if they meet certain criteria set by the Housing Choice Voucher program, commonly known as Section 8.
On the yield axis, the disparity between the FMR and market rent indicates a moderate potential for landlords who can position their properties to attract Section 8 tenants. However, the median home value in ZIP 56289 is $350,106, which is significantly higher than the FMR. This implies that the majority of homes are not affordable for typical Section 8 participants, limiting the yield potential unless the landlord has properties below the median value or in a price range closer to the FMR.
Moving to the stability axis, the ZIP code has a low percentage of renters at 7.8%, suggesting that the market is predominantly owner-occupied. This low rental rate could indicate challenges in finding tenants willing to participate in the Section 8 program, which might lead to longer vacancy periods. Additionally, the median household income of $78,958 is relatively high, further complicating the attractiveness of Section 8 to potential tenants. The Days on Market (DOM) figure being N/A suggests either a lack of recent data or a very stable housing market with few listings, making it difficult to assess the speed at which properties are typically rented.
Based on these figures, ZIP 56289 does not clearly fit into a high-yield/low-stability flip-style market or a steady-cashflow zone. Instead, it appears to be a market with limited opportunities for Section 8 participation due to the high median home value and low rental rates. The moderate difference between FMR and market rent, combined with the high median income, points towards a scenario where landlords might see some benefit but will face challenges in tenant acquisition and long-term stability.
To summarize, ZIP 56289 is best classified as a niche market for Section 8 investment, offering neither high yields nor strong stability. Landlords should carefully consider the specific properties and their alignment with Section 8 criteria before investing, given the high median home values and low rental population.
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.