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Santa Fe home sales decline, but could rebound

Copyright © 2020 Albuquerque Journal

Max Keltz had many reasons to move to Santa Fe with his family: the good weather, the art, the magic his kids felt toward the city on their first visit.

But there was one main reason he decided to make the cross-country move from Tennessee once the COVID-19 pandemic started.

“We decided to keep on our path forward during the pandemic, due to the fact that it was being taken more seriously out here,” Keltz told the Journal.

He’s not the only one.

Initially, the pandemic wreaked havoc on the Santa Fe housing market. In the second quarter of 2020, home sales in the city declined 33% compared to 2019, especially during the months of April and May when many more COVID-related restrictions were in place, according to a report by the Santa Fe Association of Realtors (SFAR).

However, real estate brokers in Santa Fe said once Gov. Michelle Lujan Grisham eased some restrictions, more people began trying to purchase homes in the area.

“July looks like it’s going to be a strong month,” said Gregory Antonsen, senior vice president of Sotheby’s International Realty Santa Fe.

Sotheby’s unit sales in June actually eclipsed those of last year, he said.

And like Keltz, many new homeowners are coming from outside New Mexico. California, New York and Texas were among the top states agents said people were moving from, with many driving from outside New Mexico to view homes.

It’s a trend occurring in many Mountain West areas, as more people move away from crowded cities where COVID-19 is deemed more of a threat. Realtors said Santa Fe’s comparatively low number of cases makes it an attractive destination.

“We can now call it the beginning of a trend of people wanting to move out of densely-populated cities to areas that have more wide open spaces,” Antonsen said.

As a result, demand for homes in Santa Fe – especially those worth between $1 million and $2 million – has soared since the start of June, multiple brokers said.

“There’s a lot of high-end homes being sold right now,” said Darlene Streit, a real estate broker in Santa Fe, who added many people are purchasing second homes.

Adding fuel to the competitive fire of buying homes in Santa Fe is a historically low inventory of available houses in the area.

Currently, Santa Fe has a little more than two month’s supply of houses, the SFAR study states. That lack of availability has, in part, led to a small rise in housing prices even as sales declined through much of 2020. Antonsen said the number of homes in inventory was “one of the lowest that I can remember.”

While much of the sales have been on higher-end homes, Antonsen said lower-priced homes are selling almost as quickly, especially those bought by investors to later be leased. He cited an increase in 1031 Exchanges, a process for an investor to defer taxes on an investment property.

“We’re seeing it in larger numbers than we have before,” he said.

Home sales in Santa Fe may be seeing a rebound, but how long it will last amid an unpredictable pandemic is anybody’s guess. Streit said Lujan Grisham’s recent order requiring all out-of-state visitors to quarantine for 14 days might have an adverse affect on the number of sales.

And although demand continues to increase in a limited market, Antonsen said it is uncertain if housing prices will rise as a result.

“It’s really hard to know what the future holds,” he said.

Julia Gelbart, a broker for Santa Fe Properties, said she was surprised by the speed with which some people are purchasing new homes in New Mexico’s capital city.

“People are being very decisive and that’s very interesting in a time when we don’t have much control over anything,” she said.


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