On average, the cost of rental property insurance in New Mexico is about $1,250 per year. However, insurance costs vary based on several factors, including property type, property location, and specific coverages.

In New Mexico, a written rental agreement is required for leases one year or longer. For leases shorter than one year, the lease may be oral, although it is generally recommended to use written agreements regardless of lease duration. 

In general, lease agreements in New Mexico must include:

• Description of the leased property
• Identifying information of all the parties involved, including names and addresses
• Rent conditions (cost, late fees, grace periods, etc.)
• Party responsible for repairs and utility bills
• Smoking policy
• Subleasing terms (if applicable)

Landlords can utilize criminal background checks during the application and tenant screening process. However, they can only look back seven years.

Real estate investors in New Mexico, and every other state, must abide by federal Fair Housing Laws. In addition to federally protected classes, New Mexico adds protection against ancestry discrimination, which occurs when an applicant is treated unfairly because of the country, nation, tribe, or other identifiable group of people from which they descend.

Since New Mexico prohibits rent control on both state and local levels, landlords are able to charge whatever they deem reasonable for rent. In 2023, the median rent for 2 bedroom properties in New Mexico is $1,313. While there are no limits for raising rent, landlords must notify month-to-month and other fixed-term tenants at least 30 days in advance of a rent increase taking effect. Week-to-week tenants require a seven-day notice.

For leases one year or less, landlords can charge up to one month of rent as a security deposit. For longer-term leases, there is no limit to the security deposit amount as long as it’s “reasonable.” Under 47-8-18 (A) (1), if a landlord requires a security deposit greater than one months’ rent, the owner has to pay the tenant interest on the deposit each year. Security deposits must be returned within 30 days after a tenant’s move-out date.

Rental property owners can charge up to a 10% late fee on any rent due. However, all late fees must be disclosed in the lease agreement.

Landlords must provide a 24-hour notice to tenants before entering a rental property, unless it’s an emergency.

Repairs that affect the habitability of a unit or the health and safety of occupants must be made within seven days of being notified of an issue by a tenant. If a landlord fails to complete repairs in this window of time, tenants may legally withhold rent until repairs are completed.

New Mexico landlord-tenant laws allow landlords to evict tenants for the following three reasons:

• Breach in lease: For a first-offense lease violation, a seven-day notice to cure or quit is required. If a tenant breaches the lease agreement a second time within the next six months, the landlord can file a seven-day notice to quit with no option to cure.
• Nonpayment of rent: If a tenant fails to pay rent, the landlord must give a three-day written notice to pay or quit and three days to make the payment.‍
• Criminal activity: For illegal acts, an unconditional three-day notice to quit is required.