New D.R. Horton homes are under construction in the Milagro Mesa subdivision in Rio Rancho. (Greg Sorber/Journal)
ALBUQUERQUE, N.M. — The spring home buying season in the Albuquerque metro area could be described this way: Fewer house listings, higher prices and faster deals.
It wasn’t just the weather that was heating up in Central New Mexico as April ended and May began. As the summer months approach, experts say home buyers should be prepared to face one of the most competitive selling seasons in years.
They say based on the number of single-family home transactions in April, demand will be intense. And that’s in an environment of rising home prices, mortgage rates and changes in the tax law that limit mortgage deductions.
While closed and pending sales were up in April from the previous year, there were fewer single-family homes to choose from, according to figures released this week by the Greater Albuquerque Association of Realtors.
The inventory of existing single-family homes for sale in the Albuquerque metro area shrunk more than 17 percent from last year in the GAAR coverage area, a region that includes Bernalillo, Valencia, Sandoval, Torrance and parts of Socorro and Santa Fe counties.
Even the number of condos and townhomes on offer saw an inventory decline of 16.5 percent from April 2017, according to GAAR.
With more buyers vying for fewer single-family residences, prices continued to climb higher. The average sales price in this category rose 2.5 percent from April 2017 to $242,037. Also during this period, detached homes moved four days faster than last year, selling in 47 days.
Still, rising home prices have yet to squelch demand, especially for those on the first rung of the property ladder, said GAAR’s president in a recent interview with the Journal. Being quick with an offer is still the rule of the day in most metro area submarkets, said Danny Wm. Vigil, GAAR president. “The Greater Albuquerque market has proven to be a strong seller’s market for 2018 so far,” he said. Year to date, sellers are getting 98 percent of the list price, according to GAAR.
But buyers are still hungry, Vigil said, and competition for homes that show well and that are still on the market continues unabated.
Meanwhile, an indicator of new-home construction in the metro area saw its best month so far this year. According to DataTraq, 203 residential building permits were issued in April. Volume rose 55 percent from last April’s figure of 131 permits.
One industry observer said the April number is a “nice bump” in activity but he isn’t sure it means the beginning of an upward trend.
“I think (April’s permit activity) is more of a case of builders like D.R. Horton, Pulte and LGI trying to close existing subdivisons out,” said John Garcia, executive vice president of the Home Builders of Central New Mexico.
In the past year, hot spots for new-home buyers were the Mirehaven, Desert Sands, Saltillo and Los Diamantes sudvisions. These communities were issued the most residential building permits.