You May Be Busier Than Ever As New Mexico’s Real Estate Market Heats Up
Despite the onset of the COVID-19 pandemic last year, the New Mexico real estate industry has remained strong. In 2021, markets across the state are forecasted to continue that momentum. With high demand, limited inventory, and rapidly rising home sale prices, real estate agents all across New Mexico should gear up for another booming year.
2021 New Mexico Real Estate Outlook: Heating Up
In November 2020, the average home in New Mexico was priced at $224,374, a 9.2% increase year-over-year. There’s little sign of prices stalling, though, as Zillow predicts this figure will rise another 10.5% within the next year. Rising prices echo the gradual healing of the economy statewide, signaling that this year could be profitable for agents and sellers alike, while low-interest rates maintain some degree of affordability for buyers.
Along with rising home prices, home sales statewide grew 15.5% year-over-year in December 2020. With inventory also falling, the average days on market dropped from 71 to 54, or by -23.9%. This momentum illustrates a departure from the typical seasonality of home buying and is a good sign for the coming winter months. Buyers are still eager to commit, even in historically slower months. Between lasting low-interest rates bolstering demand and a consistently low supply, New Mexico is a seller’s market as 2021 unfolds.
After the economic tribulations of 2020 and as more and more people flock to the Land of Enchantment, rent prices increased only 0.2% statewide but a whopping 8.4% in the Albuquerque metro area. Meanwhile, only 0.6% of New Mexico homeowners fell delinquent on their mortgage, and equity slipped into the negative on only 2.4% of homes statewide. So, while new renters and buyers alike make the move to New Mexico, current homeowners continue to thrive as well.
2020 New Mexico Real Estate Market Data
|Zillow Home Value Index||$224,374|
|1-Year Change on Home Values||+9.2%|
|1-Year Change on Rent Prices||+0.2%|
|Homes With Negative Equity||2.4%|
|Delinquent on Mortgages||0.6%|
|Buyer’s or Seller’s Market||Seller’s|
Market Insights for New Mexico
In November 2020, the statewide unemployment rate dropped from 8.1% to 7.5%. While this rate is still higher than the national average, the decrease illustrates the localized view of a larger trend, with more people returning to work and the economy gradually healing. As strong economic activity often correlates with growth in the real estate industry, falling unemployment rates are a promising sign for agents in the year ahead.
While New Mexico’s economy was particularly hard hit by COVID-19, the resilient housing market is a bright spot in the new year. Initiatives, such as free financial guidance and increased funding for job training, designed to support New Mexico residents as well as a gradual return to air travel could further help mitigate some of the economic damage. Federal assistance may also bolster economic growth and compound success in real estate. As we march deeper into 2021, New Mexico’s many unique attractions and rankings are sure to draw visitors and stimulate the local economy:
- Second in number of days of sunshine per year
- Third in total number of National Monuments
- Sixth in total acreage of public lands
With a strong 2021 forecast, New Mexico real estate agents will need to be at the top of their game. From buyers battling rising prices to sellers fielding multiple offers, there has never been a better time to serve your fellow New Mexicans. This year, agents can expect to benefit from and help contribute to a booming local and national economy as the New Mexico real estate market heats up.
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