The median home price across Santa Fe County surged to another record in the second quarter of 2021, rising nearly 35 percent from the same period last year to $600,000, the Santa Fe Association of Realtors announced Friday.

The combined city and county median price didn’t top $500,000 until the third quarter of 2020.

Outside Santa Fe city limits, the median price rose over 26 percent from last year to $647,000, while the median inside the city increased to $495,000, a 29.6 percent jump from a year ago.

And homes are flying off the market, keeping real estate agents busy.

“I have to get going again,” Keller Williams associate broker Craig Huitfeldt said during an interview. “My next person just drove into the driveway.”

Record prices and fewer homes on the market is a trend that has continued in the city and county for several years. Santa Fe has had less than a two-month supply of homes for nine months

“The model of equilibrium is six months,” said Roger Carson, president of the Santa Fe Association of Realtors. “Above is a buyer’s market, below is a seller’s market. We are so far below that I don’t even put it in a seller’s market. I put it in an auction market.”

What might be most notable for Santa Fe’s working class is the $391,750 median price for homes sold in neighborhoods west of St. Francis Drive, between Alameda Street and Interstate 25, and across the city’s entire south side in the second quarter of the year. That number is up more than 18 percent from spring 2020 and nearly 36 percent from spring 2018, when the median price was $288,272.

“We look at the MLS [multiple listing service], and they come in at $450,000 and $500,000 on Airport Road,” Carson said. “That is the heartbeat of Santa Fe, right there.”

Single-family homes were on the market for an average of only only 35 days, the shortest span since the Realtors association started keeping records in 2005. The last four quarters had homes on the market for around 50 days — the fewest until now.

Homes often get numerous offers, even in the double digits. Still, some potential buyers hesitate, Keller Williams associate broker Beth Berry said.

“I’m trying to get buyers to realize interest rates are not going to stay this low forever,” Berry said. “Now is the right time to do it.”

The number of homes on the market at the end of the second quarter was 227 — a few more than the record low of 203 in the first quarter of the year but less than half the number available in the same period last year and a third of the homes on the market in spring 2019, according to the association’s statistics.

Santa Fe recorded 470 closed home sales in the second quarter, just below the 499 sold in the second quarter of 2019.

The city has become hugely appealing amid the pandemic, with many people continuing to work remotely, and as Californians flee wildfires and seek more affordable housing elsewhere.

“It’s a change of work lifestyle,” Berry said.

Not that long ago, Californians sold homes and upgraded to larger homes in neighboring states.

“Now they are buying the same home here that they sold for three times as much and they pocket the rest,” Huitfeldt said. “I have multiple deals with Californians right now. They started coming when the pandemic started, and they have been coming ever since.”

The Santa Fe Association of Realtors has not yet done an analysis of how large the California market has grown, but Huitfeldt estimates Californians are 30 percent of the buyers he’s involved with, compared to 10 percent two years ago.

He said half his buyers will work remotely from Santa Fe.

How can nearly as many homes sell now as in 2019 with only one-third the inventory?

“Back in 2019, not every home sold,” Carson said.

The market is so tight that anything can sell. Many buyers don’t care about the condition of a home because they plan to remodel or rebuild the dwelling. They just want into the market.

“People are buying houses that normally would not be sold,” Huitfeldt said. “They would sit on the market for a long time. There’s obvious flaws. This home should be fixed.”

And it likely will sell for more than the buyer is asking.

(50) comments

Stefanie Beninato

In case you all are unfamiliar with NM water law (priority rights), agriculture particularly acequia associations, pueblos and possibly other indigneous communities will have priority rights. The OSE can do a priority call-thus denying water to those with lesser priority (judged by initial use of water and amount historically) which will be cities. We are in trouble. Please stop pretending that residential use will get priority in this state.

Khal Spencer

Water law, presumably, can be amended by a further act of law unless you are saying that water rights are enshrined in the state constitution. Given the fact that far more people live in cities than in the hinterlands, I suspect that can and will be done, albeit with considerable pain and litigation.

For that matter, only fifty percent plus one vote is needed to amend the state constitution.

Paul Davis

My thoughts precisely Khal. Yes, current law is clear. But I think that anyone who thinks that the residential population will accept notable water restrictions/shortages while fields of alfalfa get flood irrigation is probably wrong.

Khal Spencer

Hi Paul. I'm not familiar with water law. I don't know what is protected by compact and assume water treaties with First Nations (i.e. Aamodt) must be honored. But I suspect some stuff is up for negotiation or revision of law. Probably something worth my study.

https://www.santafenewmexican.com/news/local_news/aamodt-water-rights-case-the-long-road-to-a-resolution/article_a1044c80-fc52-5087-881e-403192a2ef3b.html

Stefanie Beninato

I believe it is in the state constitution. It would require an amendment in the legislature and then a majority vote by citizens. I would think that those with priority rights would not be happy with such an outcome. Also my understanding is that pueblos, for example, have agreed to temporary water sharing/saving to avoid a priority call because everyone realizes what a disaster it would be. I do not know if you can take away these priority rights at this point--even by constitutional amendment--it would be an ex post facto law.

Khal Spencer

I imagine any agreement with the Pueblos might be adjudicated in Federal court as it is an agreement with a sovereign nation. Is that correct?

Richard Reinders

Khal it is called "Taking" and once they take the water it sets them up to take your home or anything else the Government wants like Venezuela, Chili, Russia, you really want this, no legislature will vote this in. Heck Egolf owns water rights I would not expect this kind of un American talk out of you but nothing surprises me anymore these days, I think they should first take all your guns under Taking all though I don't think they have a right, but open that door and see what you get.

Richard Reinders

PS Khal Acequia law is the oldest law in the country, so if your going to do research make sure you look at their laws as well.

Rachel Thompson

A friend asked me why Californians are moving to Santa Fe out of fear of forest fires, when Santa Fe is going through its worst stretch ever in terms of vulnerability to forest fires. Especially folks who are buying up in the hills.

Moses Townsend

Now the data shows what we’ve all been experiencing…Californians are coming here in droves. Not unique to Santa Fe, but you can already see the Californication going on in parts of downtown and whatnot. Plenty of them are cool, but as a whole they don’t have a good track record of moving elsewhere and trying to assimilate. Unfortunately, pompous personalities are brought in and high maintenance demeanors.

marc LaLane

@ Moses: I only know of 1 couple that relocated from San Bernardino, CA few months ago. They are not pompous. In fact, quite personable and kind. So I am uncertain where you hang out out with all these arrogant Californians who have difficulty assimilating. Keep in mind, most pay lots of property taxes to live here, so they have just as much right to NM as you an I.

Denise Jimenez

As a former Californian, I assure you not a lot of " pompous" people living in San Bernardino, a city where the majority receives public assistance. It's not palm trees, beaches and movie stars. More like liquor stores, gangs, and stifling heat. Bet they are happy to be here !

What I worry about is most Californians never met a new law or tax hike they didn't like. When the crime, loss of freedoms and cost of living becomes intolerabe, they move on to another State and start the process again.

marc LaLane

@ Denise: Huh? Your generalization is myopic. FYI, these folks from San Bernardino own a small chain of restaurants and are not affiliated with gangs and poverty. They can reside anywhere they select because they have ample money, if that is your concern. Despite all this, they are wonderful people. Sorry to disappoint you.

marc LaLane

@ Denise: just for the record, not a lot of Californians who are movie stars, living among palm trees currently are anxious to purchase a 3 BR 2 BA home off Airport Road for 415K...trust me on this one.

LEE HAI

'KOYAANISQATSI' so much ado about nothing.

Paul Davis

Welcome to your capitalist free market folks! This is what you get (worldwide, not just here in Santa Fe) when the cost of housing is determined by the highest bidder, and when sellers are free to seek the highest possible price.

Do I have a better approach? Not really, or at least, not one that would fit in with most of ours ideas about buying, selling and owning property in 21st century USA. I don't imagine that building lots more new (affordable) housing would do much to affect the upward price drift of existing housing stock, although it would certainly help the situation for people with lower incomes.

There is an unanswered (and unasked) question in the article: is the rising median price being driven because of the ratio of buyers to sellers, or because of the (relatively) outsize financial resources of those doing the buying? Of course, "both" is a fine answer.

If you believe that buyers and sellers should be able to decide on the price of a piece of property without government involvement, then I'm sorry, but this is what you get, at least if you live in an area judged to be attractive by people elsewhere. If you don't like it, you've got 3 possible policy options;

(1) government involvement (2) make the place less attractive in some way (3) isolate from other places. While there might be a few people in Santa Fe who like one of these options, I don't believe there's a mandate here (or anywhere else in the US) to actually do any of these. There's really no legal framework for (3).

Some people feel that the water situation in the southwest (lowest soil moisture levels in 1200 years) might accomplish (2) by itself. This isn't ridiculous on the face of it, but the current water situation began 21 years ago, and somewhat like Miami's rising sea level issue, it doesn't seem to have had much impact on people's willingness or desire to consider moving here.

marc LaLane

@ Paul Davis: you mention 3 policy options. I disagree. I think it comes down to personal choice an preference. There is no reason for government involvement due to high price housing in SFe. That's nonsense when the solution is simple: don't live where you can't afford to live. And it makes no difference how many generations your family has been established in SFe. No one cares.

Paul Davis

So you feel that it's reasonable for those can afford to live in Santa Fe to expect those who provide them with services (cashiering, haircuts, landscaping, teaching, cleaning, and so, so much more) to just "find somewhere else to live" ? Or do you actually plan on paying $100 for a regular men's haircut in order for your hairdresser to be able to afford to live here?

You think it's appropriate for our first responders to all commute up from Rio Rancho or down from Espanola?

I do not.

Barry Rabkin

I feel it is absolutely appropriate for the government to never interfere in Free Enterprise. The US is run by a capitalist engine. That reality will persist for as long as there is a United States.

marc LaLane

@ Paul Davis: If first responder can only afford Rio Arriba or San Miguel counties, why not? What's your point? Not everyone can live in the foothills of SFe. Common sense: live where you can afford to live, then commute. SFe is not unique in this manner. State of NM employees do this daily for an entire career. They too can't afford foothills of SFe or Eldorado. Your logic is skewed.

Paul Davis

Marc, I don't believe that "live where you can afford it and commute" is a viable, sustainable or humane way to design, construct and develop communities. Good communities should not require people to drive 35-70 miles to get to a job. Good communities should contain housing appropriate to all those who participate in the community. Good communities recognize that the quality of life there is always enhanced by well-catered-for socio-economic diversity.

I lived in cities that became completely exclusionary to their lower-income workforce. Things don't stop working when that happens, but they definitely lose something that in my experience most people are sensitive to and aware of. Geographically separate communities of rich(er) people and poor(er) people are an important ingredient in social division and unrest.

Nobody is suggesting that every cashier in Santa Fe should be able to afford a house (or rental) in the foothills. But shouldn't they be able to afford a house (or rental) somewhere in Santa Fe? I am suggesting that their inability to do so harms all of us, even those who can afford homes in the foothills.

Rachel Thompson

I agree that a huge gap in wealth in a community’s population is not good for the social fabric. it breeds too great a consciousness of material wealth and creates resentment. And differences in opportunity. Such as schools. Not that it would make anyone feel better, but it’s not only in Santa Fe that this is happening. It’s happening in cities and towns all over the country, large and small. And I think for people who moved away and want to move back, or who never moved, It can be really painful. I have seen/heard this firsthand.

Stefanie Beninato

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Khal Spencer

Paul, the water situation is a slow moving disaster that has not hit home yet. I've been following John Fleck's blog for some time now*. I think at some point the chickens will come home to roost.

* www.inkstain.net/fleck/2021/07/reverence-or-pragmatism-the-upper-colorado-river-basins-compact-dilemma/

Paul Davis

Khal, I'm writing a short series of very short pieces for our local Galisteo newsletter about water. Based on my reading (hard to call it research), I currently have three overall conclusions: (1) there's likely to be enough water here for residential purposes more or less no matter what, because of our access to groundwater (2) whether there is enough water to support the current level of commercial agriculture in NM is a different question, and if the current drought continues (e.g. like the ones in 1210 and 1140), then the answer is probably no (3) our access to groundwater has been/is being abused, and even so this will end eventually because of the depletion rate.

Agriculture uses > 50% of all the water used in NM, and here as in CA, AZ and NV, huge quantities are being (a) used for indefensible purposes (e.g. Almonds and pistachios that are exported to Asia, alfalfa for cattle grown in the desert) and (b) wasted by using inefficient (but cheap) irrigation techniques.

Agriculture is culturally important to NM, but not particularly significant as part of our food supply (6-8%) and of only middling value economically to the state overall. If the water situation gets worse (and in terms of surface water, it is already as bad as any time in the last 1200 years), I expect conflicts between residential demand and agricultural demand to become a focal point of discussion. Nobody wants to see agriculture diminish here (I think), but realistically its current form is predicated on the pipedreams of the 1940s Bureau of Reclamation and the notion of an endlessly watered sunny farmscape, in the desert, a dream fostered by the elevated moisture levels in the first few decades of the 20th century.

Richard Reinders

The water is owned like real estate, if you tell people how to use their owned water that is open game to say your yard is to big let’s put a affordable housing high rise in you back yard. Paul I don’t believe your ok with taking deeded property away from the owner, water is a deeded right if it goes back before a set date established in the basin, for example prior to Nov 1956 in the Ammodt area it is aright of ownership after it is a privilege given by the state. The farms are slowly selling out so the cities will eventually own it for apt.s or? The other side of the coin is California grows a lot of food consumed in NM. They are slowly drying so farmers will flip crops to human food if the market offers more than for hay. Water and economies are a touchy subject sometimes years later , we say what did we do.

Khal Spencer

Spot on. There is enough for residential use but if this keeps up, something will have to give and that will be a political issue of major significance.

Paul Davis

Richard - water is owned like real estate in New Mexico, that's definitely true. But it wasn't owned that way before the US arrived here, and it isn't owned that way in most of the rest of the country (though to be fair, must of the inter-mountain west ended up with the same legal structure).

Back east, riparian rights provide access to water, but not ownership, and local authorities can actively make decisions on how to allocate the use of water based on need in a given circumstance. That's not possible here in NM, because of the ownership concept that the US set up to replace the community-owned model used by indigenous and Spanish communities.

So the question becomes: what does ownership of water mean if that water doesn't exist? If you have the property rights on 300 acre feet of water, but you don't actually have 300 acre feet of water, what precisely does that "property" really mean?

I'm not going to become an advocate for an end to "traditional" (i.e. post-US) water rights, but speaking, ahem, as an outsider, the whole concept is woefully misaligned with the likely water situation we face going into the future.

If nothing else, the entire "use it or lose it" model that farmers face is incomprehensibly dumb, particularly in the way it (a) encourages wasteful irrigation (b) prevents efficient and useful leasing of water to others.

Something has to give there, I don't know when or where, but this is not a model that serves anyone well at this point in the 21st century.

Richard Reinders

Paul I understand the historical use tell how much you can pull, the use it or lose it took another turn in the Ammodt before the state engineer would have to notify you after 4 years of non use that you could lose your water if you went a 5th year of non use but you could irrigate and stop the clock . Now you just receive a notice you have lost your water no warning.

Khal Spencer

I guess folks can all move to Michigan when housing is absolutely unaffordable here.

marc LaLane

@ Khal Spencer: perhaps not Michigan, but Las Vegas, Espanola, and Bernalillo, NM are all more affordable alternatives than SFe. Or, simply rent an apartment in SFe. There are many units being erected at the present time all over SFe. There is no law that states you have to own a home.

Khal Spencer

One word about the future. Water.

Richard Reinders

Marc ,I agree but Española draws from the same water supply as everyone down stream. Places like Ruidoso that has a completely different mountain supply same with along the Pecos.

marc LaLane

@ Richard: I have only lived in SFe 20 years, but in this entire time, the issue of water has come up every single year. Yet I see more an more development. So I don't think anyone cares. My next-door neighbor has a dumb pond that operates 24/7--she obviously does not care either.

Devin Bent

Agree with Barry Rabkin -- Santa Fe is a place where people want to live and that demand drives up prices. The lack of jobs was a limiting factor but now with people working in their homes, that becomes less important. Plus, supply is constrained. The feds, including the Pueblos, own huge masses of land that are not available for private housing development. Add those areas where wells won't work and we have severe limits on supply. Demand goes up, supply is limited -- yes, we will have price increases.

LEE HAI

Yep, as you stated ('the Feds and Pueblos, own huge masses of land not available for

private housing developement') It is one of the bleesings that is keeping northern NM

from becoming an endless urban suburb sprawl between Taos and Alburquerque as

LA/southern California has become.....Too, there is that eccential ingreediant called

'water' to consider......

Barry Rabkin

Supply and Demand ... Santa Fe is not an island onto itself. But Santa Fe continues to be a desirable location for people to move to whether for remote work or retirement. Our 'super mean governor' [I'm being sarcastic because she did the exact right thing] who closed the State during the pandemic did not nullify the economic law of supply and demand ... nor did she negate the beauty of - and around - Santa Fe nor the reasons that Santa Fe continues to remain the cultural heart of New Mexico. Supply and Demand + the many attractions of Santa Fe = more people coming here to live.

Cheryl Odom

One word: water.

marc LaLane

This is not a "ridiculous housing bubble" as stated by Kim Griego-Kiel. This is Santa Fe, folks. Discounted housing can be located in Rio Rancho (yuk) or Rio Arriba county. I have no issues with high cost of SFe housing, none at all. I think it precludes many from living in SFe county, enhancing quality of life for those who don't mind paying $550,000 for a 1600 square foot home off Airport Road. I have lived in SFe for 2 decades, an as long as I have been here, housing prices have [only] gone in 1 direction...you guess it, UP.

Nicholas Lerek

You must have slept through the bust that started in 2008 and drove down prices dramatically for years.

marc LaLane

@ Lerek: You must be referring to the junk homes in SFe, the real dives. Decent homes just remained flat pricing. SFE did not experience the "bust" most areas of USA experienced, just a flattening of local market. Ask any local agent and confirm, please, not your anecdotal evidence.

Donald Apodaca

IDEA: Add a 1% tax to home sales in Santa Fe for housing the poor and homeless. Right now Santa Fe has the premiere non-profit that is providing services and housing to those that need it most. St. E's has been doing it right for decades. Now they are poised to HELP Santa Fean's prepare for INFLATION like we have never seen before.

Stefanie Beninato

Yeah, Donald, a tax on a sale of a home is going to increase the cost of any buyer--no matter what the income. IMHO it would make it even harder for first-time or lower-income buyers to become home owners.

Donald Apodaca

Stefanie, currently a single person making $50k a year is considered poor. In 5 years that WILL jump to $100k. Folks need to PREPARE for inflation to rise that high in such a short time.

Kim Griego-Kiel

This is a ridiculous housing bubble if I’ve ever seen one. Over priced and completely pricing out most of the people who actually need to live and work here. I’d say this falls on leaderships closed ears when we talk about it.

Richard Reinders

Just remember with printing trillions and giving it away the US Dollar is severely devaluated .What cost you $1.29 for gas now is $3.00 plus same with lumber, homes, cars, and chicken wings.

Ernest Green

To a degree you are pointing to imbalances in aggregate supply with aggregate demand. Much of this a direct result of the global pandemic and disruptions to the various supply chains. This is distinct and separate from inflationary pressures as a result of monetary policy, the closest example of which would apply is interestingly noted in the article >> the value of the dollar buys much more in northern NM than in California and Houston.

Richard Reinders

But the materials to build a house went up 140 plus % that is inflation

Rikki West

Santa Fe is experiencing what cities like Santa Cruz, Seattle, Denver, Boulder, Portland and Austin have been experiencing for decades. You’ve been discovered. It’s not going down anytime soon or ever. Building affordable housing is the right answer. The above mentioned cities did not build affordable housing in a timely manner and housing sky rocketed.

Santa Fe is smart to build up this housing now. No amount of complaining, hating on new arrivals or using localism as a banter will matter. Sad but true.

Donald Apodaca

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