SANTA FE – New Mexico’s homeless population has surged by 48% over the last year, a trend complicated by a steep decline in affordable rental housing statewide since 2020.
While state lawmakers appropriated $84 million this year for housing and homeless programs, a report presented Tuesday to a key legislative panel found some market-driven forces could be difficult to reverse.
For instance, rent costs in New Mexico have increased by 70% since 2017, while average wage levels during the same time period grew by just 15%, according to the Legislative Finance Committee report.
“We do not have enough affordable housing to systematically move people out of homelessness,” LFC program evaluator Kathleen Gygi said during a hearing Tuesday at the state Capitol.
The findings were released on the same day Gov. Michelle Lujan Grisham issued an executive order creating a new housing council that will be led by former House Speaker Brian Egolf of Santa Fe.
The governor said the council, which includes legislators, homebuilders and nonprofit leaders, will be tasked with coming up with recommendations on how to spend the appropriated housing funds and other initiatives that could be proposed during next year’s 30-day legislative session.
“I think this could be the most important work we do in the next couple of years,” Lujan Grisham said while signing the order Tuesday, adding some staffers in the Governor’s Office have searched for years for affordable housing in Santa Fe.
But she acknowledged the issues are complex, due to the layering of involved state, federal and local agencies in housing issues.
Amy Whitfield, the governor’s housing and homelessness adviser, said New Mexico’s current lack of affordable housing compromises economic development efforts in the state and forces some state residents to commute long distances to work.
She also said the administration’s efforts would focus on home ownership — not rentals — and be targeted at housing stability for state residents.
“For the people who really need help, New Mexico needs to be that family for them,” Whitfield said during the legislative hearing.
In response to questions from lawmakers, Whitfield said the idea of rent control would likely not be part of the housing council’s plan, after a bill that would have limited how much landlords can raise rents stalled during this year’s session.
“I’m not going to say it’s off the table,” Whitfield said. “It’s on the table, but hasn’t been looked at.”
Several lawmakers spoke in opposition to rent control, with Sen. George Muñoz, D-Gallup, the LFC’s chairman, saying it would lead to big jumps in insurance costs and other expenses.
Homelessness surges
The report presented Tuesday is a follow-up to a January report that found New Mexico’s emergency homeless shelter capacity had more than doubled since 2016, especially in the Albuquerque area, even as the supply of affordable housing across the state dropped.
The previous report also indicated the state’s homeless population had declined over the last decade.
But the new report said that decline abruptly ended last year, and might have been partially misleading since some people avoided homeless shelters during the early stages of the COVID-19 pandemic.
In any case, a count conducted in January indicated a 48% increase — from about 2,600 people to nearly 4,000 people — driven primarily by an uptick in unsheltered individuals in the Albuquerque area.
While New Mexico has enough emergency shelter beds to accommodate the state’s homeless population on a temporary basis, according to the report, at least some of those shelters are difficult to access, such as the Westside shelter in Albuquerque that is roughly 18 miles from downtown.
In addition, the report found the state lacks enough transitional and permanent housing to help people exit homelessness, as the legislative report cited the need for an estimated 859 additional housing units for the state’s homeless population.
That would cost an estimated $11.4 million annually to accomplish.
Meanwhile, the state stands to lose an estimated 5% of its roughly 29,000 publicly assisted rental units over the next five years due to expiring affordability commitments or deterioration, according to the report.
Sen. Siah Correa Hemphill, D-Silver City, asked if the proliferation of vacation rentals in some New Mexico cities and towns is contributing to the affordable housing shortage.
“As soon as a house comes on the market, someone from California will come and buy it and convert it into a vacation rental,” she said.
In response, state housing officials said the issue does appear to be contributing to the state’s housing problem, but is not the sole factor.
State takes larger role
The creation of the governor’s new housing council represents the latest sign of New Mexico’s state government taking a more active role in an issue long governed by local and federal governments.
Egolf, an attorney who did not seek reelection to the state House last year, said he believes local governments should have a lesser say on permitting for new housing developments, after several proposed projects in Santa Fe were recently stymied amid neighborhood opposition.
But he also said a greater state involvement in housing issues, perhaps by issuing loans or other incentives to developers, could bolster New Mexico’s affordable housing supply.
“I think there are opportunities to shift some of that risk off the private sector onto the government,” Egolf said.
At least some lawmakers appeared to agree, with Rep. Jack Chatfield, R-Mosquero, saying the large number of federal, state and local agencies involved with administering housing programs makes it difficult to effectively provide services.
“I think as a state we need to take better control of coordination of these resources to make sure we’re getting them out there,” Chatfield said.
Rep. Tara Lujan, D-Santa Fe, cited the issue of gentrification in the state’s expensive capital city, which prompted legislation in 2000 aimed at minimizing annual property tax increases for homeowners.
“I can’t afford to buy a house in my own district in Santa Fe,” Lujan said during Tuesday’s hearing.
