Median home prices in Santa Fe, N.M., soared to $412,000 in the fourth quarter of 2018, a 27% increase from a year earlier, according to the Santa Fe Association of Realtors.
While the median price climbed, exceeding the $394,000 figure reported in the third quarter of 2018, the number of sales reported through the association’s Multiple Listing Service dropped by nearly 5% from the fourth quarter of 2017.
“With record low inventories, Santa Fe’s housing market is experiencing a strong uptick in median home prices similar to those during the overheated housing market of 2007,” the association’s president, Beth Stephens, said in announcing the latest data.
She also said an increase in land and real estate sales in the area “may be the result of investors wanting to diversify their holdings as stocks take a bumpy ride entering 2019.”
While higher sale prices might make homeowners feel wealthier, it provides little comfort for people looking to buy in Santa Fe’s housing market.
The association noted in a news release: “With median prices rising, low inventory and another recent increase in interest rates, housing affordability fell to an index of 71% of what is necessary to qualify for a median-priced home under prevailing interest rates.”
Median price means half the properties sold for a higher price and half sold for a lower price.
The inventory of homes for sale in Santa Fe decreased by 14%, to 1,015, in the fourth quarter.
“We’re short of inventory on the bottom end of the market,” said Stephens, defining bottom end of the market as $250,000 or lower, edging closer to $300,000. “I would say this is a stable market. It is on the rise [but] it is hard to get a real indication for the long term.”
Median prices in southwest Santa Fe, where more homes sell than in other sections of the city combined, increased 15.4% to $298,245 after increasing 10.4% in the third quarter.
Homes prices outside city limits in Santa Fe County dipped 1.2% in the fourth quarter from $505,000 to $499,000.
“Santa Fe is a very high-priced market,” said Laura Altomare, chief communications officer at Homewise, which builds and sells homes and assists people to achieve home ownership. “It can be very difficult for low- and moderate-income people to afford home ownership in Santa Fe.”
Homewise has a grant to offer $20,000 in down payment assistance to 350 new homeowners across the state, she said.
“We have upped our real estate activities,” Altomare said.
In past years, Homewise built 40 to 45 homes a year.
“This year we intend to build 60 homes,” she said. “Next calendar year, we intend to increase that.”
Homewise is about to break ground on condos priced at about $200,000 at El Camino Crossing on Agua Fria Road near Siler Road.
The Santa Fe Association of Realtors did not have statistics immediately available regarding the record high quarterly home price in Santa Fe.
“We’ve taken a look at some of our historical data and it appears that this figure is close to a historical high,” Donna Reynolds, the association’s government affairs director, said.
The association cautioned that not all sales are reported in its database. The median sales price is determined from only those sales listed on the Multiple Listing Service, which does not include every sale but has been used historically to track trends in the home buying market.
Tribune Content Agency