Location: Norman County, MN | Metro: Becker 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 | $710 |
| 1 Bedroom | $780 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,300 |
| 4 Bedrooms | $1,540 |
| 5 Bedrooms | $1,786 |
| 6 Bedrooms | $2,000 |
| 7 Bedrooms | $2,160 |
| 8 Bedrooms | $2,268 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,010 | $319,846 | 0.32% | F |
| 3BR | $1,300 | $377,604 | 0.34% | F |
U.S. Census Bureau data (2024)
The ZIP code 56589, located in Waubun, Minnesota, represents a small market with a population of 1,760 individuals. Among these residents, only 13.0% are renters, indicating that this area is predominantly a homeowner-dominated community. This suggests that the demand for housing vouchers, such as those provided through the Section 8 program, is relatively low compared to areas with higher percentages of renters.
The median household income in this ZIP code is $72,969, which provides a context for evaluating the affordability of local rents. The average market rent stands at $608, representing approximately 8.3% of the median household income. This figure is considerably lower than the Federal Market Rent (FMR) of $970 for the metro area, which is set for fiscal year 2026. The discrepancy between the local rent and the FMR highlights that tenants in this area have a significant margin when it comes to meeting rental costs without substantial financial strain.
In terms of tenant profiles, landlords can expect a mix of families and individuals who are likely to be employed and earning close to the median income. Given the low percentage of renters and the modest market rent, the typical tenant will be able to afford the rent comfortably, leaving them with ample disposable income. This scenario reduces the risk of default on rent payments, making it a stable investment environment for landlords and small-portfolio investors.
To summarize, ZIP 56589 is not a renter-heavy area with deep voucher demand; instead, it is an area dominated by homeowners. The market rent of $608 is significantly below the FMR of $970, suggesting that tenants can manage their rent payments easily. Landlords should anticipate a tenant base that is financially stable and capable of maintaining regular rental payments.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-08-31). 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.