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 | $970 |
| 1 Bedroom | $1,080 |
| 2 Bedrooms | $1,400 |
| 3 Bedrooms | $1,940 |
| 4 Bedrooms | $2,200 |
| 5 Bedrooms | $2,552 |
| 6 Bedrooms | $2,858 |
| 7 Bedrooms | $3,087 |
| 8 Bedrooms | $3,241 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,400 | $225,667 | 0.62% | D |
| 3BR | $1,940 | $296,671 | 0.65% | D |
U.S. Census Bureau data (2024)
The ZIP code 87935, located in Elephant Butte, NM, stands out within Sierra County due to its unique demographic and economic characteristics. With a population of 2,094 residents, it has a rental rate of 24.4%, indicating that nearly one-quarter of the housing units are rented. The median income here is $51,033, which is relatively modest compared to other areas in New Mexico. However, the median home value is significantly higher at $237,635, suggesting that homeownership is a substantial investment in this community.
When considering the Section 8 voucher program, the data reveals an interesting dynamic. The Fair Market Rent (FMR) for the metro area for fiscal year 2026 is set at $1,420, whereas the Census American Community Survey (ACS) indicates the average market rent is $1,111. This means that landlords who accept Section 8 vouchers can potentially receive higher rents than the current market average, making it an attractive option for those looking to maximize their rental income. The difference between the FMR and the actual market rent could also indicate that there is room for rent increases without deterring tenants, especially those who rely on government assistance.
Based on the data signature, ZIP 87935 appears to be in a transitional phase. While the median income is moderate, the high median home value suggests a growing interest in homeownership, possibly driven by the natural beauty and recreational opportunities of Elephant Butte Lake. The disparity between the FMR and market rent rates further supports the idea of a transitioning market, where the government aims to support affordable housing through higher voucher amounts. For landlords and small-portfolio investors, this ZIP code offers a mix of challenges and opportunities. They must balance the potential benefits of higher rental income from Section 8 vouchers against the needs of a community where many residents may depend on such assistance to afford housing.
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.