Location: Crow Wing County, MN | Metro: Aitkin County, MN
Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)
| Unit Size | Monthly FMR |
|---|---|
| Studio | $810 |
| 1 Bedroom | $890 |
| 2 Bedrooms | $1,160 |
| 3 Bedrooms | $1,390 |
| 4 Bedrooms | $1,590 |
| 5 Bedrooms | $1,844 |
| 6 Bedrooms | $2,065 |
| 7 Bedrooms | $2,230 |
| 8 Bedrooms | $2,342 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,160 | $382,399 | 0.3% | F |
| 3BR | $1,390 | $453,712 | 0.31% | F |
| 4BR | $1,590 | $581,464 | 0.27% | F |
U.S. Census Bureau data (2024)
A skeptical investor might raise several concerns regarding investing in ZIP 56444 (Deerwood, MN). Let's address these points:
Will FMR $1,020 (metro FY 2026) cover the mortgage on a $418,628 home? The Fair Market Rent (FMR) for ZIP 56444 is projected to be $1,020 in fiscal year 2026. However, this figure alone does not guarantee it will cover the mortgage payments on a home valued at $418,628. To determine if the FMR is sufficient, one must consider the typical mortgage rates and terms, as well as property taxes and insurance costs. Without specific loan details, it is difficult to definitively state whether the FMR will fully cover the mortgage.
Is there enough renter demand at 14.8%? With only 14.8% of the population renting in Deerwood, an investor might question the demand for rental properties. While this percentage indicates a lower-than-average rental market, it is important to note that the total number of renters can still support a modest portfolio. Additionally, Deerwood's smaller community size means that even a small percentage of renters can represent a significant number of potential tenants. Local economic factors and employment opportunities should also be considered to gauge the overall demand for rentals.
Will vouchers keep pace with $853 market rents? The market rent in Deerwood is currently around $853, while the FMR is set to increase to $1,020 in 2026. Vouchers, however, are subject to federal funding and policy changes. There is no definitive data indicating that voucher amounts will adjust to meet the market rents or the future FMR. Investors relying on voucher recipients should monitor both local and federal housing assistance programs to ensure that they remain viable sources of income.
The data suggests that while there are challenges, Deerwood offers a stable environment for real estate investment. Careful consideration of the local rental market, mortgage affordability, and the reliability of housing vouchers is necessary to make informed decisions.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.