Location: Santa Fe, NM | Metro: Santa Fe, 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 | $1,470 |
| 1 Bedroom | $1,640 |
| 2 Bedrooms | $2,020 |
| 3 Bedrooms | $2,480 |
| 4 Bedrooms | $2,650 |
| 5 Bedrooms | $3,074 |
| 6 Bedrooms | $3,443 |
| 7 Bedrooms | $3,718 |
| 8 Bedrooms | $3,904 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,640 | $405,477 | 0.4% | F |
| 2BR | $2,020 | $511,507 | 0.39% | F |
| 3BR | $2,480 | $642,553 | 0.39% | F |
| 4BR | $2,650 | $779,403 | 0.34% | F |
| 5BR | $3,074 | $903,403 | 0.34% | F |
U.S. Census Bureau data (2024)
Santa Fe, NM's ZIP code 87508 is characterized by a relatively small population of 18,518 residents, with only 7.4% being renters. This indicates a predominantly owner-occupied area where the majority of the community owns their homes. The median household income in this neighborhood stands at $101,565, reflecting a higher-income bracket compared to many other areas. Additionally, the median home value is notably high at $645,589, which further underscores the affluent nature of the neighborhood.
The economic landscape for rental properties in ZIP 87508 is defined by the disparity between the Fair Market Rent (FMR) and the actual market rent. According to the latest data for fiscal year 2024, the FMR for this zip code is set at $1,930. However, the market rent, as indicated by the Zillow Observed Rental Index (ZORI), is significantly higher at $2,413. This gap suggests that there is potential for rental income above the government-set rates, which could be appealing to investors looking to maximize returns on their investment properties.
Given these factors, ZIP 87508 would likely appeal more to a hands-on value-add buyer rather than a hands-off voucher operator. The higher market rents indicate that there is room for property improvements that can command premium rents, making it a good opportunity for those willing to invest time and capital into enhancing their properties. For hands-off operators, the lower FMR might not justify the risks and costs associated with managing properties in such an affluent area, especially considering the relatively low percentage of renters.
To summarize, the neighborhood in ZIP 87508 offers a unique blend of affluence and limited rental demand, creating an environment that is best suited for active investors who can capitalize on the potential for higher-than-average rental incomes through property enhancements and strategic management practices.
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.