If you picked up or were delivered a copy of The New Mexican on Oct. 11, perhaps you saw the Haciendas magazine promoting the annual Parade of Homes sponsored by the Santa Fe Area Home Builders Association.
The magazine has a new look. On the other hand, it’s the only thing remotely resembling any other Parade of Homes in the past. Unlike another parade going on an hour south of Santa Fe, ours is 100 percent virtual — and for good reason.
When Kurt Faust, a co-owner of Tierra Concepts, was association president in 1992 as a forward-thinking 30-something, he brought forward the first Haciendas — A Parade of Homes tour. Faust had help from a of slew of other young custom homebuilders.
They were determined to make the association something more than a monthly social gathering with drinks, dinner, and loud talk about bureaucracy and unfriendly inspectors. It was a time when another affordable housing crisis was upon us, and the young entrepreneurs of homebuilding sensed an opportunity.
Money was looser. Friendly local bankers could read the tea leaves of the market. They knew if the builder had a down payment on some land, that was enough. A loan could be made to take out the balance of the land payment and then finance the infrastructure and vertical construction. It’s called speculation. The word has a negative connotation, but it’s nothing more than guessing that if you build it, someone will buy it.
That youthful optimism and confidence had a good run. From 1992 until 2008, the parade was predicated on speculative homes constructed by hometown builders competing against one another for sales and recognition by their peers and the public.
It’s a small town. The friendly competition ratcheted up the quality and the “wow” with each passing year.
By 2008, the association was turning away builders because it reached its maximum capacity of 40 homes in the parade. The crash ended those halcyon days, and the parade has limped along ever since.
The competition didn’t decline after the crash of 2008, but the paradigm of participation shifted. No more speculative homes. No more local banks giving out construction loans that paid off the balance owed on land with the first draw. No more loans even if the builder owned it free and clear.
Since the crash, the parade has almost exclusively featured homes built under contract with homeowners. Clients have been calling the shots, and builders have had to beg them to let hundreds of strangers traipse through their homes. That’s a hard sell in a pandemic, which is why the 2020 version is virtual.
There are a few homes that started off as speculative, but with today’s historic low home inventory, they inevitably got purchased before completion. Back in the day, it was common to hear about paradegoers whipping out checkbooks and paying full price with no sales commission.
Current market demand is as strong or stronger than the ’90s. What’s different is the money, or lack thereof, for speculative construction. It’s true for a speculative home in Las Campanas, true for a local affordable home subdivision developer in Terra Contenta and true for everything in between.
Still, it’s a great opportunity to catch a glimpse of the outstanding homebuilding in Santa Fe. Miles Conway, executive officer of the association, has pulled off a virtual miracle that is likely to save the organization’s bacon for 2020.
The website featuring videos of 19 homes is live at www.santafeparadeofhomes.com.