Median home prices in the second quarter rose 5.1 percent over the same period a year ago in the city of Santa Fe, with the countywide median price up 7.4 percent, according to the Santa Fe Association of Realtors.
The relentless price increases since early 2016 continue, while the home inventory available to buyers has been dwindling since 2008, leading to a 20.7 percent year-to-year decrease in homes sold in the city in the second quarter.
The median price for a home in the city was $370,000. In the county it was $429,500.
Homes listed on the Santa Fe Multiple Listing Service have plummeted in the past 11 years, from nearly 4,000 to 1,131 at the end of the second quarter, SFAR statistics show.
Unincorporated areas, however, saw an 11.6 percent increase in home sales, with the northwest quadrant north of N.M. 599 seeing the biggest surge in sales at 36 percent in an area with the highest median home prices in the county at $849,250. Sales growth has been stoked by continual home construction in the Las Campanas development, Santa Fe Association of Realtors President Beth Stephens said.
“The lack of inventory in the city has people moving over the line and more out there,” Stephens said.
Soaring home prices and low availability are a nationwide plague caused by rising construction costs over the past three years and a shortage of qualified construction workers.
“The cost of building is detrimental to the market,” Stephens said. “By the time a home is built, it may not be affordable.”
The Association of Realtors calculated the Housing Affordability Index for Santa Fe at 78, which means the median income family has only 78 percent of the income to qualify to buy a median-priced home.
“I couldn’t qualify to buy my house today,” Stephens said.
Santa Fe by no means is alone in its struggle with housing affordability. ATTOM Data Solutions, an Irvine, Calif., property data provider, determined that in 74 percent of 480 counties analyzed, average wage earners could not afford a median-priced home in the second quarter.
Affordability for ATTOM is based on spending no more than 28 percent of income on the house payment, property taxes and insurance. ATTOM pegs Santa Fe at 51.6 percent of annualized income to buy a home.
Santa Fe’s lack of affordable housing has been a constant over decades, in contrast to many Western cities that have seen large increases in unaffordability in recent years. Santa Fe scores a 105 on ATTOM’s home affordability index, with under 100 being less affordable than the city’s historic average. Many cities across the the Rocky Mountain region and West Coast are in the 70s, 80s and 90s, indicating more drastic decreases in affordability.
“It’s a long-term and systemic problem,” said Laura Altomare, chief communications officer at Homewise, a Santa Fe homebuilder of affordable homes for people earning less than 120 percent of the area median income. “It’s never new news. It’s never a surprise to us that affordability is a serious issue in Santa Fe.”
Residential land sales in unincorporated Santa Fe County soared 46.9 percent in the second quarter, particularly in the southwest quadrant, including the N.M. 14 corridor to Madrid and the area between Santa Fe Regional Airport and Interstate 25. The Association of Realtors recorded 72 properties sold, while 49 properties sold the prior spring.
“Land sales were slow the last seven, eight years,” said Wolfgang Brandt, owner/broker at Brandt Distinct Properties outside Cerrillos. “Land is selling outside the city because the city is expensive again.”
Brandt said he is noticing Texans and Coloradans are back to buy after an absence of some years. He figures half the land sales in the southwest quadrant are to neighbors from the east and north.
“Within the last six, eight months land sales have picked up,” he said. “We are just starting to get back making land sales.”
Brandt said the wet winter has increased the desire for land at the foot of the Ortiz and Captain Davis mountains.
“We have never seen them as beautiful and green as this year,” he said. “It is just stunning.”