Section 8 Fair Market Rent (FMR) for ZIP 87111 - 2027

Investment Score for ZIP 87111

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,240
1 Bedroom	$1,410
2 Bedrooms	$1,760
3 Bedrooms	$2,420
4 Bedrooms	$2,850
5 Bedrooms	$3,306
6 Bedrooms	$3,703
7 Bedrooms	$3,999
8 Bedrooms	$4,199

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,760	$305,434	0.58%	F
3BR	$2,420	$402,523	0.6%	D
4BR	$2,850	$535,972	0.53%	F
5BR	$3,306	$735,704	0.45%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 87111 (Albuquerque, NM) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 87111 is set by HUD to ensure that rental assistance vouchers cover the cost of housing in the area. For 2026, the FMRs are as follows: - 0BR: $1270 - 1BR: $1490 - 2BR: $1840 (which is 24.5% of the median household income) - 3BR: $2560 - 4BR: $3010 To understand how these FMRs compare to actual rents, we need to look at the occupancy rate and renter percentage. The occupancy rate is 96.1%, indicating that the vast majority of units are occupied. With 38.7% of the population being renters, there is a significant demand for rental properties. However, the Zillow median price for a 2BR home is $306,464, which suggests that property values are quite high relative to rental costs. This is further emphasized by the Price-to-FMR ratio of 13.9x, meaning that the median home value is nearly 14 times higher than the median 2BR rental cost. This disparity between home values and rental costs can create constraints for voucher holders. Landlords may be reluctant to accept vouchers due to the high property values and potential for higher returns on investment through sales rather than rentals. Additionally, voucher holders might struggle to find units that fall within their budget, especially since the FMR for a 2BR unit is only $1840, while the median home value is significantly higher. #### Affordability & Renter Profile ZIP code 87111 has a median household income of $90,290, which is relatively high compared to the national average. The FMR for a 2BR unit is $1840, representing 24.5% of the median income. This indicates that the typical resident can afford a 2BR unit without much financial strain, but it also means that the renter population likely includes individuals who are below the median income level. Given that 38.7% of the population are renters, there is a substantial segment of the community that relies on affordable housing options. The tight market conditions, with a high occupancy rate and significant renter population, suggest that there is little oversupply of rental units. This makes it challenging for lower-income renters to find affordable housing, particularly if they are relying on Section 8 vouchers. The high median home value and low FMR indicate that the rental market is competitive, and landlords have the leverage to charge rents above the FMR. #### Investor Angle From an investor’s perspective, the ZIP code 87111 presents both opportunities and challenges. The FMRs provide a baseline for what the government will pay for rental assistance, but the actual rents charged in the market are likely higher. For instance, the Zillow median price for a 2BR home is $306,464, which translates into a potential rental rate far exceeding the FMR of $1840. Given the high occupancy rate and significant demand for rental properties, investors who can secure units at or near the FMR could potentially achieve positive cash flow. However, the challenge lies in finding landlords willing to accept vouchers at these rates. The high property values might incentivize some landlords to prefer selling their properties or renting them out at market rates, which are considerably higher than the FMR. The investment grade for this ZIP code would depend on the ability to find properties that are both affordable and suitable for voucher holders. If an investor can secure such properties, the potential for positive cash flow exists, but it requires navigating the complexities of the local rental market and landlord preferences. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high median home value and the relatively low FMRs, smaller units (0BR and 1BR) are more likely to be rented at or near the FMR. These units are often more affordable for voucher holders and may be easier to manage from an investment standpoint. For example, a 0BR unit at $1270 or a 1BR unit at $1490 would be more accessible for those receiving rental assistance. 2. **Target Areas with Lower Property Values**: While the overall median home value is high, there may be pockets within ZIP 87111 where property values are lower. Identifying these areas could provide better opportunities for securing properties at or near the FMR. Investors should conduct detailed neighborhood analyses to pinpoint these locations. 3. **Engage with Local Housing Authorities**: Building relationships with local housing authorities can help investors understand the specific needs and preferences of voucher holders. This knowledge can be used to tailor properties to meet those needs, thereby increasing the likelihood of securing tenants. Additionally, local housing authorities may have programs or incentives to encourage landlords to accept vouchers. #### Bottom Line For Section 8-focused investors, the recommendation for ZIP code 87111 is to **Hold**. While there are opportunities to secure smaller units at or near the FMR, the high median home value and competitive rental market make it challenging to find properties that offer positive cash flow. Engaging with local housing authorities and conducting thorough neighborhood analyses can help mitigate some of these challenges, but the overall market conditions suggest that investors should proceed cautiously and focus on areas with lower property values. In summary, the tight market and high property values in ZIP 87111 present significant barriers for Section 8 voucher holders and investors seeking to capitalize on affordable housing. Careful consideration and strategic planning are essential for success in this ZIP code.

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.