Location: Rio Arriba County, NM | Metro: Albuquerque, NM MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $910 |
| 1 Bedroom | $1,070 |
| 2 Bedrooms | $1,320 |
| 3 Bedrooms | $1,840 |
| 4 Bedrooms | $2,160 |
| 5 Bedrooms | $2,506 |
| 6 Bedrooms | $2,807 |
| 7 Bedrooms | $3,032 |
| 8 Bedrooms | $3,184 |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 87528 reveals an interesting scenario when comparing federally mandated rent limits with current market rents. The Fair Market Rent (FMR) for a two-bedroom apartment in the metro area for fiscal year 2026 is set at $1,200 annually. However, the actual market rent based on Census ACS data is only $472 per month, which annualizes to $5,664.
To calculate the implied gross yield, we need to consider these figures against the median home value. Unfortunately, the median home value for ZIP code 87528 is not available, making it impossible to derive a precise cap rate. Nevertheless, using the FMR and market rent figures, we can infer the gross yields.
If we were to use the FMR of $1,200 as the annual rental income, the implied gross yield would be significantly lower than if we used the market rent of $5,664. Given that 35.8% of the population are renters and the days on market (DOM) figure is not available, it's reasonable to assume that market conditions might favor higher rental rates. This suggests that landlords should aim for the market rent rather than the FMR to maximize returns.
In conclusion, while the exact cap rate cannot be calculated due to the lack of median home value data, the gross yield based on market rent is substantially higher than what would be derived from the FMR. Landlords and small-portfolio investors should focus on securing rental rates closer to the market average to ensure better financial performance. With a renter density of 35.8%, there is a notable demand for rental properties, supporting the case for achieving higher rental incomes.
Data Sources: FMR data from HUD (2027). 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.