Location: Sierra County, NM | Metro: Sierra 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 | $710 |
| 1 Bedroom | $780 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,410 |
| 4 Bedrooms | $1,600 |
| 5 Bedrooms | $1,856 |
| 6 Bedrooms | $2,079 |
| 7 Bedrooms | $2,245 |
| 8 Bedrooms | $2,357 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $780 | $118,067 | 0.66% | D |
| 2BR | $1,010 | $153,292 | 0.66% | D |
| 3BR | $1,410 | $221,410 | 0.64% | D |
| 4BR | $1,600 | $254,842 | 0.63% | D |
U.S. Census Bureau data (2024)
ZIP code 87901 encompasses a significant portion of Truth or Consequences, New Mexico, a town known for its natural hot springs and scenic landscapes. The area has a total population of 6,378 residents, with nearly 38.3% of them being renters. This indicates a substantial demand for rental properties, making it an attractive market for landlords and small-portfolio investors. The median household income in this ZIP code is $34,242, which is relatively low compared to national averages, suggesting that many residents rely on affordable housing solutions such as Section 8 vouchers.
The median home value in ZIP 87901 stands at $156,297, reflecting the overall affordability of the housing market. When it comes to rental economics, the Federal Market Rent (FMR) for the metro area in fiscal year 2026 is set at $970. However, the current market rent, according to the Census Bureau's American Community Survey, is $713. This discrepancy between the FMR and the actual market rent presents an opportunity for hands-off voucher operators who can benefit from the higher subsidy rates without necessarily having to compete with lower market rents.
The area's characteristics make it suitable for both hands-off and hands-on investors. For those looking to operate with minimal involvement, the higher FMR compared to the market rent allows for a steady, predictable income stream without the need for extensive property management. On the other hand, for hands-on investors seeking to add value, there is potential to improve properties and command rents closer to the FMR, thereby increasing profitability. Given the significant percentage of renters and the reliance on affordable housing options, the demand for well-managed Section 8 properties is likely strong, offering a solid investment opportunity in either approach.
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.