Affordable housing: Stopping the exodus

New study shows city loses $301 million annually because high costs force workers to find cheaper places to live

Anne Constable | The New Mexican

4/29/2008 - 4/30/08

Kate Campbell and her husband gave up on finding an affordable house in Santa Fe when the real-estate broker showed them a mobile home priced at $198,000.

"It wasn't even a nice mobile home," Campbell said, but the broker haughtily announced the owners, "will get their price."

A little later, while traveling to Albuquerque on an errand, the couple decided to stop at Rio Rancho to look at model homes. They were impressed by the low prices and high quality. In 2003, they bought a three-bedroom house on a half-acre for $142,000. The mortgage was about $900 a month and gas was only $1.89 a gallon back then.

Campbell, who works in the restaurant industry, and her then-husband earned their wages in Santa Fe but spent all their discretionary income in Rio Rancho or Albuquerque.

"When we finished work, we didn't want to stay in Santa Fe one extra moment," Campbell said. She did her grocery shopping in Rio Rancho. The restaurants and movie theaters they patronized were there. "We never even bought gas in Santa Fe. Every dime was spent somewhere else," Campbell said.

A new study by Homewise Inc., a nonprofit that has helped more than 1,200 low- and moderate-income people purchase homes, shows a migration of workers to more affordable communities is having a serious economic impact on Santa Fe.

About 9,000 Santa Fe workers have moved outside the county, but continue to commute to their jobs. But they don't spend their money here. Homewise estimates the city loses more than $301 million annually, based on the calculation that these homeowners spend about 63 percent of their annual incomes where they live, not where they work.

The study reports that in the last year alone, 640 workers moved outside the county, taking with them $21.4 million in annual spending.

The exodus is not news to Mike Loftin, executive director of Homewise, but the size of the economic loss surprised him. "We're losing that much money in our local economy simply because people can't afford a home here. l knew this, but it's like, wow, this is real money," Loftin said.

"I think Santa Fe is a community that understands that buying and spending money locally is good for the local economy, but you can't get people to buy local if they don't live local. That's the obvious place to start," he added.

Homewise is spearheading a home-ownership campaign in partnership with local businesses and government. The nonprofit has already helped more than 100 school staff and 12 hospital employees buy homes and has worked with 17 other local employers. Business leaders and public officials are invited to a meeting today to talk about how to help more workers buy their own homes.

"The most important thing an employer can do is to get word out to employees," Loftin said. "The biggest barrier is that people just don't think they can do it."

Lack of affordable housing in Santa Fe is a big impediment to attracting and keeping police officers, school teachers and nurses, the study said. It pointed to the 2007 City of Santa Fe Needs Assessment, which showed that 40 percent of employers surveyed had lost at least one employee in the last two years because of the cost of living here. Campbell said her husband's co-workers "all live in Rio Rancho and had to get out of Santa Fe to find an affordable home."

While homes are cheaper elsewhere, the Homewise report suggests other costs are higher. Lengthy commutes reduce family time, add to stress and, with gasoline heading toward $4 a gallon, wipe out much of the savings. The Homewise study says over a year's time, a person commuting from Albuquerque to work in Santa Fe incurs $24,123 more in time (at $20 per hour) and travel costs than local residents.

Campbell, general manager at Pranzo Italian Grill, said driving her sport-utility vehicle from Rio Rancho to Santa Fe to work cost close to $500 a month. Her husband, who had to commute separately, and drove a gas-efficient car, was spending nearly as much, $480 a month. Plus the commute was wearing. She'd often be stuck for hours in traffic, and she didn't have much time to enjoy her home.

In April 2007, after her divorce, Campbell, moved back to Santa Fe where she bought a two-bedroom house off Jaguar Drive for $207,000 with the help of Homewise. Her mortgage is $1,100 a month. But even at $3.65 a gallon, her fuel bill is a lot lower.

Contact Anne Constable at 986-3022 or aconstable@sfnewmexican.com.