Location: Colfax County, NM | Metro: Colfax County, NM
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 | $840 |
| 1 Bedroom | $960 |
| 2 Bedrooms | $1,050 |
| 3 Bedrooms | $1,420 |
| 4 Bedrooms | $1,650 |
| 5 Bedrooms | $1,914 |
| 6 Bedrooms | $2,144 |
| 7 Bedrooms | $2,316 |
| 8 Bedrooms | $2,432 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,050 | $127,119 | 0.83% | C |
| 3BR | $1,420 | $206,564 | 0.69% | D |
U.S. Census Bureau data (2024)
The market analysis for Section 8 investors in ZIP code 87740, which encompasses Raton, NM, and parts of Colfax County, reveals a favorable environment for rental properties. The HUD Fair Market Rent (FMR) for the metro area, set at $1,020 for fiscal year 2026, significantly exceeds the average market rent of $746, based on Census ACS data. This discrepancy indicates that voucher tenants will likely provide positive cash flow, even when considering standard operating costs and vacancy rates.
To further understand the investment landscape, we can examine the rent-to-price ratio using the median home value of $152,841. Given the FMR of $1,020, the annual rent would be approximately $12,240. Dividing this by the median home value yields a rent-to-price ratio of roughly 8%, suggesting that rental income can be a substantial portion of the property's value. This ratio is particularly appealing for investors seeking steady cash flow from their investments.
The dynamics of days on market (DOM) and price-cut shares do not significantly impact the decision-making process for rental investors in this region. With a median DOM marked as N/A, it implies that sales data might be limited, and the 0.1% price-cut share indicates that sellers rarely need to reduce asking prices to attract buyers. However, these factors are less relevant when focusing on rental properties rather than sales properties.
In conclusion, the strongest investor angle in ZIP 87740 is cash flow. The disparity between the HUD FMR and the actual market rent means that landlords can expect a healthy profit margin from voucher tenants, making this area an attractive option for those looking to generate reliable rental income.
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.