This article is syndicated from The New Mexican, click here for the original article.
By Bob Quick | The New Mexican
Posted: Wednesday, July 14, 2010
Lower prices and even lower mortgage rates propelled Santa Fe home sales in the second quarter of 2010, increasing 40 percent from depressed levels a year ago.
“It’s a nice little perfect storm for anyone who wants to get into the real estate market,” said Lois Sury, president of the Santa Fe Association of Realtors.
Sury spoke at Santa Fe Association of Realtors’ quarterly news conference to discuss residential and commercial real estate sales in the second quarter of 2010.
“Santa Fe homes are selling across all price ranges during the second quarter of 2010,” Sury said. “During April, homebuyers were still taking advantage of the federal fax credits, but sales remained strong in May and June.”
Alan Ball, a title company executive who publishes a newsletter about Santa Fe real estate, agrees the real estate market got a boost from the federal homebuyer tax credit, but it was not as popular here as elsewhere, where home prices are lower.
Ball’s concern is inventory. “We’re not making much progress. That’s because there’s so much inventory combined with very difficult conditions for lending approvals these days.”
At the same time the number of Santa Fe home sales was up, the median sales price of houses sold in the city dropped from $307,500 to $288,000 in the second quarter of 2010.
In Santa Fe County at the same time period, the median price of a home fell to $411,250 from $450,000.
In addition, the 2010 second-quarter home sales volume rose by $36 million when compared to the home-sales volume in 2009.
Total city/county condo/townhome sales numbered 58 in the second quarter of 2009, compared with 57 last year in the same time period.
And total city/county land sales showed some sluggishness, with 27 lots sold in the second quarter of 2010 compared with 32 for same period in 2009.
Overall, “everything appears to be selling,” Sury said, “The signs are all positive.”
For her part, Judy Balch, vice president and mortgage lending manager at First National Bank of Santa Fe, confirmed that residential rates are low, with a 30-year mortgage fixed at 4.5 percent with no points.
“That’s excellent,” Balch said, adding that the rate for a jumbo mortgage ($427,000) was just over 5 percent.
Balch said the bank expects rates to remain low for the rest of 2010.
Ball agrees that low rates are helpful, but he points out that buyers are nevertheless lethargic because they’re afraid homes they buy might drop in value.
“It doesn’t matter what a house is worth a year after they buy it,” Ball said. “They need to hold the house for seven to 12 years. It will be worth more then, but not six months or a year.”
Ball has some expectations as Santa Fe moves through the prime real estate season, which runs through October, that sales could pick up.
“It’s not just the three summer months” when the most Santa Fe residential real estate is bought and sold, he said. “It’s too early to pass judgment on the year, but I don’t see any big leaps forward. There will be some very small steps.”
As for commercial real estate, John Shepler, who has his own real estate firm, said sales and leasing “are still fairly slow. We’ve seen some small movement in the downtown corridor.”
Shepler expects the rest of the year to be much the same.