THE HOUSING MARKET:
A BUYERS NIGHTMARE
Intro
Buying a home in the Greater Albuquerque Area has been
increasingly difficult over the past two years. New Mexico,
specifically, the Albuquerque area, is an ever-growing area,
with thousands of jobs entering the state, we are seeing more
and more people make New Mexico their home. However, it
has become increasingly difficult for these home buyers to find
and buy a home, the past two year in the Southwest Multiple
Listing Service, further recognized as the SWMLS, we have
been sitting with a standing inventory that is 25% of what it
had been in years prior. This has been in part to the growth of
the area, the ongoing pandemic and the lack of new homes
being built. Throughout this report, you will see how I
collected my data, along with the way I interpreted the data.
Then you will see what conclusions were drawn from this data
in order to find the best possible solutions. This report is for
anyone currently interested or involved in the housing market,
that may be having trouble, or are interested in my findings.
Methodology
Step 1
My first step was to do simple online research, in order to find
out if any cities or states have implemented any rules or laws to
help control and contain their market. Also, to search for other
solutions for buyers that someone else may have come across.
However, not much information was found.
Step 2
The second step I took in this project was to collect raw data and
statistics. I gathered my data from the Greater Albuquerque Area
of Realtors (GAAR) which pulls its statistics directly from the
SWMLS. The goal was to find data that directly correlated to the
negative buyer experiences that many have been facing in the
past two years.
Step 3
My last step involved creating a short questionnaire in which I
asked five realtors to complete, only four of which did. These
realtors all work for Coldwell Banker Legacy, however, that
should not affect data as realtors are independent contractors,
everyone has their own separate and independent work and style.
Of my participants, I surveyed one realtor who did 10+ million in
sales in 2021, this person represents a top tier realtor. Two
realtors did between 2 and 6 million in sales, they represent the
majority of realtors. Lastly, one realtor that did less than 2
million in sales and is new to the business.
For more information on this study, please ask for a copy of the full report
Data
This chart is a summary of what buyers have had to deal with in the market
recently. In 2021, there were 25% or less homes on the market compared to
2015. This has made it very difficult for buyers to find a home. In response to
the low inventory, prices have also driven up. As seen in the third section. This
combination of low inventory and high prices has made a nightmare for
anyone trying to buy a home in the Greater Albuquerque Area.
It has not become uncommon for listings to receive multiple offers in a short
amount of time, often, homes can sell in less than 24 hours and well over list
price. The figure above shows that the average percent of list price a house
sold for was more than 100% this last January for the entire city of
Albuquerque. It used to be rare for a house to sell over list price, however, it is
now expected in the current market.
Data Cont.
As shown below, the average price of a detached home in
the Greater Albuquerque Area has drastically increased
over the last couple years. In 2021 there was a $50,000
increase in the average price. Making it much more
difficult for buyers as they now have even less buying
power than they did from the prior year where your
average price was still up more than $25,000.
Lastly, results from the questionnaire were pretty straight
forward. All of our realtors, had troubling experiences
helping buyers find homes. They did not have many
solutions besides encouraging buyers, but when asked if
they thought new builds were a good option, 3 of the 4
said they would be, the only one who did not was our new
realtor.
Solution
Buyers should search for
new homes.
After research and collection of data, including taking in
what other Realtors had to say. The best option for buyers
now is to look for new or undeveloped homes. While it may
take some time for a house to be built and a new house may
cost a little more than an aged home. Buying new would
eliminate buyers from getting involved in bidding wars and
ultimately overpaying for a home anyways. From our
research, the production of newly built homes is starting to
pick back up, making this a much more viable option for
buyers in the market than it was a year ago when very few
newly built homes were going up. Otherwise, buyers will be
stuck with low inventory and battling in bidding wars, as
they have been for the past two years.
homesbysethpayson@gmail.com