Location: Eddy County, NM | Metro: Chaves County, NM
| Unit Size | Monthly FMR |
|---|---|
| Studio | $980 |
| 1 Bedroom | $1,070 |
| 2 Bedrooms | $1,180 |
| 3 Bedrooms | $1,630 |
| 4 Bedrooms | $1,740 |
| 5 Bedrooms | $2,018 |
| 6 Bedrooms | $2,260 |
| 7 Bedrooms | $2,441 |
| 8 Bedrooms | $2,563 |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 88250 reveals some critical insights for landlords and small-portfolio investors. To begin, the Fair Market Rent (FMR) for a two-bedroom apartment in this area, as of fiscal year 2026, is set at $1,120 per month. This figure is based on the metropolitan guidelines and represents the government's assessment of what constitutes a fair rent for subsidized housing.
Given that the median home value in ZIP 88250 is not available, we must rely on other metrics to derive an understanding of the potential returns. The first scenario involves using the FMR as the basis for rental income. With an annualized rent of $13,440 ($1,120 x 12 months), the gross yield can be calculated if we assume a median home value. However, since the median home value is not provided, we cannot accurately calculate the gross yield under this scenario.
The second scenario would involve using the market rent as the basis for rental income. Unfortunately, the market rent for ZIP 88250 is also not available, which means we cannot compare it directly to the FMR to determine a more accurate gross yield. This lack of data makes it challenging to provide a precise comparison between the FMR-based gross yield and the market rent-based gross yield.
Despite these limitations, the 0.0% renter density indicates that very few residents in ZIP 88250 participate in the Section 8 program. This low participation rate suggests that landlords might face challenges in finding tenants who qualify for and are willing to use Section 8 vouchers. Additionally, the absence of data on the Days on Market (DOM) for rentals further complicates the analysis, as it would help gauge how quickly properties are leased out.
In conclusion, while the FMR of $1,120 per month provides a clear benchmark for rental income, the lack of specific data on median home values and market rents prevents a definitive calculation of the gross yield. The low renter density and missing DOM data imply that landlords should approach Section 8 investments in ZIP 88250 with caution, considering the potential difficulties in attracting and retaining tenants through the program.
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.