Location: Sioux Falls, SD | Metro: Sioux Falls, SD HUD Metro FMR Area
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 | $1,180 |
| 1 Bedroom | $1,310 |
| 2 Bedrooms | $1,540 |
| 3 Bedrooms | $2,120 |
| 4 Bedrooms | $2,570 |
| 5 Bedrooms | $2,981 |
| 6 Bedrooms | $3,339 |
| 7 Bedrooms | $3,606 |
| 8 Bedrooms | $3,786 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $2,120 | $278,708 | 0.76% | D |
U.S. Census Bureau data (2024)
The rent math in ZIP code 57012, located in the Sioux Falls, SD HUD Metro FMR Area, does not align favorably for landlords and small-portfolio investors. The Fair Market Rent (FMR) set at $910 for the fiscal year 2024 is significantly below the market rent reported by the Census ACS at $1,075. This discrepancy suggests that landlords would need to charge above the FMR to cover costs and maintain profitability.
Regarding acquisition affordability, the median home value stands at $300,697. With the lack of data on days on market (DOM) and the percentage of homes needing price cuts, it's challenging to provide a comprehensive analysis. However, the median home value indicates that purchasing properties in this area is relatively expensive compared to other regions, which could deter potential investors looking for more affordable entry points.
Tenant demand in ZIP 57012 is modest but present. With a total population of 1,168 and 18.9% of residents being renters, there is a clear pool of potential tenants. Despite the small number of renters, the demand is steady, and landlords can expect a reasonable occupancy rate if they manage their properties well.
In summary, while there is a steady tenant demand in ZIP 57012, the rent math does not work in favor of landlords due to the disparity between FMR and market rents. Additionally, the high median home value makes acquisitions less affordable, especially for small-portfolio investors. These factors suggest that investing in this area requires careful consideration and strategic planning to ensure profitability.
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.