Location: Marshall County, MN | Metro: Marshall County, MN
| Unit Size | Monthly FMR |
|---|---|
| Studio | $830 |
| 1 Bedroom | $910 |
| 2 Bedrooms | $1,180 |
| 3 Bedrooms | $1,560 |
| 4 Bedrooms | $1,860 |
| 5 Bedrooms | $2,158 |
| 6 Bedrooms | $2,417 |
| 7 Bedrooms | $2,610 |
| 8 Bedrooms | $2,741 |
U.S. Census Bureau data (2024)
A skeptical investor analyzing ZIP code 56737 might raise several concerns regarding the feasibility of investing in rental properties here. Let's address these objections head-on using available data.
Objection 1: Will the Fair Market Rent (FMR) of $970 for the metro area in fiscal year 2026 be sufficient to cover the mortgage on a home?
The FMR of $970 represents the average rent level that can be expected in the area for fiscal year 2026. However, the data does not specify the median home value or typical mortgage payments in ZIP 56737. Without this information, it's challenging to definitively state whether this rent amount will cover a mortgage. Landlords should calculate their own break-even point based on property costs and financing terms.
Objection 2: Is there enough tenant demand at 16.1%?
The 16.1% figure likely refers to the percentage of households that rent in ZIP 56737. This suggests a moderate level of demand for rental properties. While this percentage is not exceptionally high, it indicates a stable rental market. It's important to note that the actual number of renters can vary significantly depending on the total number of households. Investors should also consider the vacancy rate and local employment trends to gauge the strength of the rental demand.
Objection 3: Will Housing Choice Vouchers keep pace with the market rent of $485?
The market rent of $485 is notably lower than the FMR of $970, which could indicate a discrepancy between voucher values and market rates. The Housing Choice Voucher program aims to provide assistance to low-income families, but the data does not clarify if the voucher amounts have historically kept up with the increases in market rents. Given the lower market rent, it's possible that vouchers may cover a larger portion of the rent, making them attractive to both tenants and landlords. However, the long-term sustainability of this relationship depends on future adjustments to voucher amounts and market conditions.
In conclusion, while the data provides insights into some key factors such as FMR and market rent, it lacks specifics on home values and mortgage costs, which are crucial for determining profitability. Additionally, the rental demand appears stable but not robust, and the potential mismatch between voucher amounts and market rents presents another challenge. Careful analysis and due diligence are essential before making investment decisions in ZIP 56737.
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.