The 2 bedroom fair market rent in Watertown (Carver County) is $1,520 for FY2026. Rents here moved +4.1 percent year over year. ZIP 55388 sits in the Minneapolis-St. Paul-Bloomington, MN-WI area.
See how this ZIP compares for Section 8 vouchers, fair market rent against market asking rent for every tracked Minnesota ZIP.
| Unit size | FY2026 FMR | Vs FY2025 | ACS median |
|---|---|---|---|
| Studio | $1,100 | +3.8% | |
| 1 bedroom | $1,250 | +4.2% | |
| 2 bedroom | $1,520 | +4.1% | |
| 3 bedroom | $2,020 | +2.5% | |
| 4 bedroom | $2,270 | +1.3% |
FMR is the HUD Fair Market Rent for this ZIP, the 40th percentile of gross rents. It anchors Section 8 payment standards and runs below top of market. ACS median is the Census survey estimate where available.
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Among the 12 Carver County ZIP codes with a HUD rent estimate, 55388 ranks number 11 of 12 on 2 bedroom fair market rent. That is $105 below the county median of $1,625. The county runs from $1,520 in Young America 55397 to $2,560 in Victoria 55386. Statewide the median 2 bedroom fair market rent is $1,090, which puts Watertown 39 percent above the Minnesota median. The largest single year move since FY2021 came in FY2025, +15.0 percent, and the 2 bedroom estimate has gone from $1,100 to $1,520 over 5 fiscal years. Zillow does not publish a rent index for 55388, so the fair market rent is the only published rent benchmark here. The landlord voucher check compares an asking rent against it. Voucher competitiveness for every Carver County ZIP code with both signals is on the Carver County Section 8 page.
Of the 6 nearest ZIP codes with an estimate, Mayer 55360 carries the highest 2 bedroom fair market rent at $1,830 and Delano 55328 the lowest at $1,520, against $1,520 here.
The HUD fair market rent for a 2 bedroom in ZIP 55388 is $1,520 for FY2026. Actual rents vary by unit size, condition, and location within the ZIP.
The 2 bedroom fair market rent rose 4.1 percent from FY2025 to FY2026, moving from $1,460 to $1,520.
Fair Market Rent is HUD's estimate of the 40th percentile gross rent for a ZIP. It sets Section 8 payment standards, so it is the rent a voucher will support here. Investors use it as a conservative floor when underwriting rental income.
Rent level is only one input. Run the numbers: at $1,520 for a 2 bedroom, a deal in Watertown pencils or it does not based on price, taxes, insurance, and financing. Pencilwrite computes cap rate, cash-on-cash, DSCR, and true ROE from a few inputs.
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