Location: Farmington, NM | Metro: Farmington, NM MSA
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 | $1,190 |
| 1 Bedroom | $1,200 |
| 2 Bedrooms | $1,470 |
| 3 Bedrooms | $2,050 |
| 4 Bedrooms | $2,210 |
| 5 Bedrooms | $2,564 |
| 6 Bedrooms | $2,872 |
| 7 Bedrooms | $3,102 |
| 8 Bedrooms | $3,257 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $2,050 | $343,200 | 0.6% | F |
U.S. Census Bureau data (2024)
The Section 8 thesis for ZIP code 87415 is centered around the disparity between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR is set at $1520, whereas the Census ACS data indicates a market rent of $1495. This means that the FMR is higher than the market rent by $25, or approximately 1.67%. Despite this small gap, it is important to understand the implications for landlords and small-portfolio investors.
In this scenario where the FMR exceeds the market rent, landlords can benefit from accepting Section 8 tenants. The federal government will pay the difference between the tenant's contribution and the FMR, ensuring a steady and reliable income stream. With only 19.2% of residents being renters and a median home value of $304,801, the rental market is relatively small compared to homeownership, which makes securing stable tenants crucial. Additionally, the median income of $44,095 suggests that many potential voucher holders may struggle to find affordable housing without assistance.
Accepting Section 8 tenants transforms this area into a yield play for landlords. The guaranteed income from the government ensures that properties are not left vacant due to the limited number of renters. This stability is particularly valuable given the high median home value, indicating a strong local economy but also suggesting that rental properties must compete with homeownership opportunities.
However, there are considerations regarding the cost of housing voucher tenants. While the FMR provides a higher base rent, the administrative burden and potential maintenance issues associated with voucher programs can offset some of these benefits. Landlords should weigh these factors against the advantages of consistent rental income and the support of federal subsidies.
To summarize, the FMR being slightly above the market rent in ZIP 87415 creates an opportunity for landlords to secure stable, long-term tenancy through Section 8 vouchers. Given the context of a predominantly homeowner population and moderate median income, this can be a strategic move to maximize yields while providing affordable housing options.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.