It’s no secret that the Albuquerque housing market has been downright grueling last year. The demand for housing in the Albuquerque metropolitan area has skyrocketed since the pandemic began. A highly competitive housing market is not just limited to Albuquerque. Medium and small cities in the US are experiencing similar trends as their markets as people try to escape the less desirable living conditions in overcrowded metropolitan areas on the coast. Albuquerque’s affordable housing and abundance of recreational opportunities have drawn buyers from across the country.
Nob Hill has particularly felt the rise in real estate demand. Nob Hill’s housing market includes portions of zip codes 87106, 87108, 87110; and aside from new homes near Central Avenue, not many new homes are being built. “There are simply more buyers than houses in the market,” said Belinda Franco, president of the Greater Albuquerque Real Estate Association, of the state of the market in one of Albuquerque’s most desirable neighborhoods.
What makes Nob Hill such a in-demand place to lay your head? The proximity to restaurants, shops, bars and the pedestrian zone have created a hub of activity in the heart of the city. It is also close to the university, creating a demand for housing for those who want to live close to their place of work. Several Nob Hill neighborhoods, such as the Monte Vista and College View subdivisions, are listed on the National Register of Historic Places.
According to the latest figures from the MLS real estate database, the average home value in Nob Hill has increased 13.3 percent since 2020 to an estimated $ 345,000. As with other markets of similar size to Albuquerque, the rise in home values has been driven by a lack of available homes versus increasing demand. However, the recent boom in the market is unique because of its sheer competitiveness. The average Nob Hill three-bedroom home sales price in June has been over $ 380,000 so far. The market has practically turned into an all-out bidding war, with the average number of days for a home on the market being only three days.
When asked about out-of-state buyers, Franco said that many buyers from California and other areas with competitive real estate markets have an advantage over New Mexico residents because their properties are sold at much higher prices. “We’re seeing a lot more multiple offers and cash offers,” she said. Demand for Albuquerque’s relatively cheap housing market is also not helping state buyers, as the sale of their properties cannot compete with those selling in more competitive markets.
Comparison of the Albuquerque Market
According to GAAR, the price of a single-family home in Albuquerque rose 26.3 percent from May 2020 to May 2021. At the start of the pandemic, the price of a three-bedroom single-family home was $ 290,000 compared to $ 333,448 in the most recent figures are from May 2021. Franco believes the pandemic made many people want to rethink what they want and need in a home. The pandemic has also forced more people to work from home, and many, especially those with families, saw the need to move to larger rooms with home offices. “People have re-evaluated their way of life,” said Franco.
The busy market has also drastically cut the time a property is listed. According to GAAR, “single-family homes sold on average in 13 days, 43.5 percent faster than in May 2020”. As a result, not only are Albuquerque residents facing competition from foreign buyers, but finding a property that meets a buyer’s needs has become significantly more difficult.
Franco predicts that demand for Albuquerque real estate is likely to continue well into 2021. Given past trends, she expects the traditional seasons for selling a home, spring and summer, to keep the market busy. Sellers are eager to list their properties, especially because of record market demand, she noted in an interview.
Although it is a chore to find a home, the boom in the housing market is also a boom for other industries in the city. “For every house sold in Albuquerque, it pumps $ 72,000 back into our local economy,” said Franco. The demand for houses leads to a demand for services like construction, cement, and a handful of other related industries. The motivations for shoppers to move in the first place are the same motivations that pump money and investment back into the community. The pandemic has inspired many buyers to customize their living space to suit their needs, leading to increased demand for services in other industries.
At the national level, rising house prices have raised the question of whether the real estate market is on the way to replicating the infamous real estate bubble that contributed to the Great Recession in 2007. Much like other experts around the country, Franco is confident that this is not a bubble. “It feels very different. It doesn’t feel like the real estate bubble before, ”she said. She noted that the factors driving demand are different than they were in the early 2000s. Record-low mortgage rates and a generation of millennials reaching prime age for home buying were the main reasons behind the nationwide boom.
GAAR predicts that Albuquerque’s hypercompetitive real estate market is likely to last well into 2022 and that there should be no warning of a real estate bubble. Franco believes there is still a lot of competition and room for growth in the city.
Nob Hill at a glance:
- Average Rent: $ 1244 (* softens real estate)
- Average Home Price: $ 345,000 (* ml)
- Median Income: $ 51,867 (* softens realty)
- Business Drivers: Education, Retail, Food & Beverage
- Transit Score: 47 (* WALKSCORE.COM)
- Accessibility rating: 82 (* WALKSCORE.COM)
- Jobs Nearby: UNM / CNM, Government, Retail, Food & Beverage