The Greater Albuquerque Association of REALTORS® November Market Statistics report shows home prices are stabilizing, inventory is up and fewer homes are going under contract compared to this time last year.
The trend tends to favor homebuyers who are seeing an increase in supply and less demand in the greater Albuquerque area. Increased supply and lower demand drives home prices down, but overall market activity also tends to slow.
“As we enter the holiday season, we’re starting to see less activity in the local housing market,” 2022 GAAR President Bridget Gilbert said in a Dec. 10 press release. “Home buyers will benefit the most as there is less competition for homes right now.”
The housing market typically slows over the holidays when fewer people are moving and looking to purchase a home, but higher mortgage rates also play a role in the number of people taking out loans. According to Freddie Mac, the average 30-year fixed-rate mortgage was hovering around 7% from late October to mid-November.
Over the summer, the average rate was 5-6%, which compared to 7% is a difference of hundreds of dollars on a monthly payment and tens of thousands of dollars over the life of the loan. Homebuyers are in luck, though. Albuquerque is not only seeing an increase in inventory and less demand, but mortgage rates are also trending downward.
“Over the last four weeks, mortgage rates have declined three-quarters of a point, the largest decline since 2008,” Freddie Mac reported on Dec. 8. “While the decline in rates has been large, homebuyer sentiment remains low with no major positive reaction in purchase demand to these lower rates.”
According to the Consumer Financial Protection Bureau, lenders were offering rates as low as 5.625% and as high as 7.75% on a 30-year fixed rate mortgage for a $330,00 home in New Mexico with 20% down and a credit score between 700-719. At the 5.625% rate, a borrower will pay $283,104 in interest over 30 years. At the 7.75% rate, a borrower will pay $416,878 in interest over 30 years, a difference of $133,774.
November numbers for the greater Albuquerque area
According to GAAR’s November report, the number of single-family detached homes going under contract decreased 29.7% compared to November of last year. Inventory increased by 52.9%, but only 701 new listings were added to the market last month, representing a 17.6% decrease compared to November of last year.
Last month the median sales price of single-family detached homes was $328,000, a 5.8% increase from November of last year, but a decrease from the October 2022 median price of $335,000. Homes are also staying on the market longer compared to November of last year. GAAR reports detached homes were selling in 28 days on average last month, which is 75% slower compared to the same time last year.
Condos and townhomes are also staying on the market longer, but only selling 7.7% slower compared to the same time last year. The median sales price for condos and townhomes increased 8.9% to $245,000 compared to November 2021. In October of this year the median price of single-family attached homes was $229,000.
A comparison of the market in four northeast Albuquerque zip codes
Market trends in the northeast part of the city reflect what’s going on in the greater Albuquerque area with the exception of a few differences. The median price of single-family detached homes decreased in two of the four zip codes identified in northeast Albuquerque compared to the same time last year. Median prices for single-family detached homes increased for year-to-date comparisons in all four zip codes, however. The year-to-date increases from 2021 to 2022 include the median prices of detached homes through November for both years.
Inventory of homes for sale in November 2022 increased in three of the four zip codes compared to the same time last year. New listings increased in one zip code, decreased in two and stayed the same in one. See the chart below to compare inventory and new listings in the 87109, 87111, 87113 and 87122 zip codes.