Out of Reach

Santa Fe home prices still rising while inventory plummeted last year

Santa Feans continue to face an increasingly costly and competitive housing market, a quarterly report from the Santa Fe Association of Realtors shows, with the median price for single-family homes shooting well over half a million dollars.

Median single-family home prices in last year’s fourth quarter rose 13% from the same period in 2020, up to $607,500 in Santa Fe County and city combined. For condos and townhouses, the median price rose 5.5% to $398,296.

In the city alone, the median single-family price is $535,000, while in the county alone, it’s $746,000.

It’s clear that at those prices, home ownership isn’t an option for many residents.

The housing affordability index was at 49 last quarter, meaning that the median household income is 49% of what is necessary to qualify for median-priced homes. The index decreased by 14% from the same period the previous year.

Meanwhile, the number of single-family homes available for sale dropped by nearly 50% and available condos and townhouses dropped a staggering 73%. Inventory of both types of homes has been declining since early 2020, but those are the steepest declines reported over the past two years.

The average number of days between when properties were listed and when offers were accepted decreased by 41.5%.

Santa Fe’s already elevated housing landscape is in line with a trend being seen across the country.

Nationally, the median home sales price was $353,900 as of November, the latest data available from the National Association of Realtors. That figure represents a roughly 14% increase from the previous year, accompanied by a 13.3% decline in inventory.

“If inventory is low, it can cause an increase in price, but I also think that the housing market has been so busy in the last couple years that people may not be ready to sell their houses right now because they just recently bought them,” says Andrea Dobyns, the new president of SFAR.

Dobyns tells SFR the association is still seeing first-time buyers have success in purchasing homes, but with high prices and low inventory, Santa Fe’s housing market is straining an already tight rental market.

“A lot of working-age people are unable to afford homes, so they’re forced to stay put [in rentals] longer,” Billy Eagle, senior vice president at real estate group CBRE, told SFR in October. “So the supply stays relatively the same but the demand increases substantially for rental units.”

There’s an estimated shortage of about 7,343 rental units in the Santa Fe Metropolitan Statistical Area, according to SFAR’s 2021 State of Housing Report.

Over the past four years, the average monthly rent for one-bedroom apartments has increased by 40%, up to $1,358, reports CBRE.

Several affordable housing developments, funded by both public and private money, have sprung up over the past year as part of an effort to make a dent in the longstanding crisis.

The Lamplighter Inn on Cerrillos Road is slated for conversion into 58 units for people at or below 80% of the area median income, as well as special needs tenants including unhoused people. In late 2020, the city of Santa Fe and co-developer Community Solutions Group purchased Santa Fe Suites and converted the hotel into studio apartments.

Last July, the Santa Fe County Commission approved an architectural contract for the development of about 100 mixed-income units in its first public housing construction in a generation.

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