Location: McLean County, ND | Metro: McLean County, ND
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 | $890 |
| 1 Bedroom | $890 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,410 |
| 4 Bedrooms | $1,700 |
| 5 Bedrooms | $1,972 |
| 6 Bedrooms | $2,209 |
| 7 Bedrooms | $2,386 |
| 8 Bedrooms | $2,505 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,010 | $151,554 | 0.67% | D |
| 3BR | $1,410 | $257,349 | 0.55% | F |
| 4BR | $1,700 | $282,800 | 0.6% | D |
| 5BR | $1,972 | $391,849 | 0.5% | F |
U.S. Census Bureau data (2024)
A skeptical investor looking into ZIP code 58540, which includes Garrison, ND, might have several concerns regarding the feasibility of investing in rental properties under the Section 8 program. Here's a direct look at those concerns based on the available data.
Objection 1: Will Fair Market Rent (FMR) of $870 for the metro area in fiscal year 2026 cover the mortgage on a $241,649 home?
The average mortgage payment for a $241,649 home, assuming a 30-year fixed-rate mortgage at an interest rate of around 5%, would be approximately $1,270 per month. Given that the FMR is set at $870, it does not fully cover the mortgage payment. This means landlords would need to either find ways to reduce their mortgage costs, such as through down payments or refinancing, or consider other sources of income to make up the difference.
Objection 2: Is there enough renter demand at 14.0%?
The percentage of renters in Garrison, ND, stands at 14.0%. While this figure indicates a smaller proportion of the population renting compared to owning, it still represents a significant number of potential tenants. However, the data does not specify the exact number of renters or the total housing units, making it difficult to assess the overall demand. To get a clearer picture, investors should look into local demographic trends and housing needs.
Objection 3: Will vouchers keep pace with market rents of $643?
The current market rent is reported at $643, which is slightly below the FMR of $870. The U.S. Department of Housing and Urban Development (HUD) adjusts voucher amounts annually to reflect changes in market conditions. If the market rent in Garrison, ND, remains stable or increases at a rate similar to the historical trend, it is likely that voucher amounts will adjust accordingly. However, there is no guarantee that they will always match the FMR or market rents exactly.
In summary, while investing in ZIP 58540 under the Section 8 program presents some challenges, particularly with the FMR not covering the mortgage on a median-priced home, the data suggests that there is a manageable level of renter demand and that voucher amounts could potentially keep pace with market rents. Investors must conduct thorough due diligence, including understanding local housing dynamics and financial planning to account for the gap between FMR and mortgage 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.