New Mexico housing market on pace for record year

Real estate agents say 2017 could be a record-setting year for New Mexico's housing market.

The Realtors Association of New Mexico reports that 1,760 properties were sold in March, representing an increase of more than 6 percent over the same period last year.

The figures also show that 19 counties across the state reported an increase in sales for the first quarter over the first three months of 2016.

That's the case in Dona Ana County, where the Las Cruces Association of Realtors reports an increase of more than 9 percent in that time period. Area Realtors sold 356 new and existing homes, townhomes and condominiums between Jan. 1 and March 31. Last year, over the same time period, 326 homes were sold.

Josie James of Exit Realty said retirees are helping drive the increase in sales, again turning to Las Cruces as a place to settle away from colder and more crowded locations. They are joined by increasing numbers of buyers looking to purchase their first home.

"Between $160,000 and $200,000, I can sell those (homes) all day long," James said. "I feel 80 percent of our first-time buyers are in that price range."

Prices are beginning to edge upward as the supply of available homes for sales begins to shrink, she said. And it certainly looks like a sellers' market.

"As far as the supply, we are starting to see more people getting multiple offers on property," Jones said. "It's driving the prices up. The market is definitely shifting. It's turning around. We're starting to see the sellers' market come back."

Steve Montanez, an associate broker with Steinborn & Associates, said a lack of available homes is starting to affect the market. Montanez said he has had to urge potential buyers who would normally shop in the $100,000 range to consider looking in the $110,000 to $120,00 neighborhood instead. He said he used to be able to tell potential buyers there was a pool of 1,100 homes (not including manufactured homes or bank foreclosures), but now can draw only on a pool of 650 or so homes.

"We are significantly lower in choices," Montanez said. "Our market would be faster if there were more options."

As the price of low-end homes rises, homes in other price ranges rise accordingly. Homes valued over $200,000 are usually purchased by professionals with incomes above $75,000 annually, he said.

"That's a reflection of the job market here," Montanez said. "We're not offering higher paying jobs right now, so home sales are going to stay in the $150,000 to $170,000 range. But it is still a very optimistic market for sellers. Sellers now know inventory is so low so they can ask more for their homes. They aren't going to be too unreasonable but they are not afraid to ask a little more because the options are so low."

This year's increased production in the Las Cruces area is less dramatic than the gains posted between the first quarters of 2015 and 2016, when 38 additional home sales represented a 13.2 percent year-over-year increase.

Statewide, association officials say inventory is still tight in many areas and homes that are priced right are going quickly and sometimes getting multiple offers. Median prices are also on the rise, up 4 percent statewide from last year at this time.

The group says property sales contributed over $1 billion to New Mexico's economy during the first quarter.

Tribune Content Agency
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