Albuquerque’s luxury Real Estate market: Things you should know

Albuquerques’s luxury Real Estate market: Things you should know

(Transcript Snippet): ” Tracy:

Say that not every house with a pool is luxury. We just in the last couple of weeks, we’ve had two transactions going where the houses were under 300,000, had a pool. I went to an inspection on behalf of one of our agents, who’s out of town for the holiday and I happened to go and meet her clients and let them in their house. And it’s a $250,000 house with an in-ground pool with an automatic cover. And it was two 50. So, you know, you think of a pool as a very high end luxury item, but there are pools on, on homes around not, we’re not like some markets, right. Pools are not common here. The high desert, it gets cool at night. Yeah,

Tego:

It’s not like Phoenix. When you look at a Phoenix, satellite aerial and you look down and every other house, or maybe every, maybe two to two out of three. Yeah. Obviously depends on the neighborhood.

Tracy:

Most of them have pools the majority. Yeah. Yeah. So

Tego:

One of the stories I saw last week and I was sitting there reading it when you walked into my office the other day tracing it. And I think the headline was, I might not get this just right. But it was basically, you know, the new status symbol in the country is, you know, outdoor living spaces, you know, glamorous, outdoor backyards or outdoor spaces, you know, and of course here in New Mexico, it’s great. Cause we do have, you know, almost really almost four seasons, but let’s say three seasons where you can really, where you can be outside if you do it. Right. Yeah.

Tracy:

And you know, I also saw an article. So you were, I walked in on you with an article and I had just read one in a, in a travel magazine. And they were talking about all the movie stars and actors and actresses doing outdoor living. And that was a huge thing. And how over the top they were. And it was kind of interesting, but we see a lot of beautiful outdoor spaces here in New Mexico. One of my favorite outdoor spaces in New Mexico is at the Hyatt, Tom. I

Tego:

Yes, it’s pretty nice. That’s such a great, if you haven’t been out there, it’s like going to a different world. You know, you just go a little bit north of, of the city here and you’re kind of in a different place and you’ve got that beautiful view out there. I

Tracy:

Follow them obviously on Twitter and Facebook and things got the horse rehab out there. So if you ever looking for someplace to donate to the bales of hay have gotten very expensive and feeding those horses costs a lot, but you can go out there and go for a trail ride through the Boskey or up on the Mesa, just spectacular. And they also have day use. So you can go out there and just pay a small fee and use their swimming pools. So speaking of living in luxury, speaking of luxury,

Tego:

It’s a luxury, Tracy. I just want to bring some data into this. So the luxury housing market, we’ve seen a 65% increase in close sales of homes, over $500,000 in the Albuquerque market in the last year, 12 months, rolling 12 months. And in, you know, we’ve, we’ve seen literally bidding wars on million dollar houses in the Albuquerque market. That was unheard of just, you know, a year or two years

Tracy:

Ago. Right. I’ve seen several bidding wars for million dollar houses.

Tego:

And so it all goes back to this whole conversation about swimming pools and luggage, you know, outdoor living spaces, home offices, right. You know, COVID and the pandemic has changed the way people look at homes. And I think what happened, and this is, I don’t have any good data to back this up, but tell me what you think. I think COVID a lot of people just started rethinking the whole idea of their home, what they want in their home. All of a sudden we had 3% interest rates, I may say, well, shoot, I’m going to be home more often. I want what I want. I can afford it. I can do, you know, get the 3% interest rate on that, that higher end luxury type home, and really get what I want. And, and you’re, you’re shaking your head. They can’t see you on the radio, but you’re, you’re agreeing with me?

Tracy:

I am agreeing with you. And you know, one of the things that just dawned on me is I’ve noticed, and a lot of the luxury clients are people who, because of COVID, aren’t traveling for work as much as they used to. I can think of probably five, just like that, of people like Brenda, who used to travel for work almost every weekday. Yeah.

Tego:

Yeah. High, high power executive with a national big Corp, you know, company you would recognize. Yeah. Yeah. And,

Tracy:

You know, decided to move and get that dream home and is working from that home now because the travel is down and she’s working from home. She hasn’t, well, she’s just starting to do some travel again, but it’s never going to look like what it was before. And she recognized that and she went, okay, everybody’s online. Now. I can actually live where I want to live. She doesn’t have to be at a major airport that can go international. Like she used to have to be. Yeah.

Tego:

And I think that’s really driven the luxury market for sure. It’s just people wanting what they want and recognizing they can get it

Tracy:

Right. And with the interest rates and made it so much more affordable. And they’re locking in that rate for a long time, you know, people aren’t using adjustable rate mortgages right now because they’re not a better deal. Right. We have this conversation with a client moving here, moving back to New Mexico who grew up in New Mexico. Right. And you know, they they’re locking in 3% or something because they’re doing 15 year and they looked at adjustable rate because they figured they might not be here more than a few years because of what’s bringing them here. And it really wasn’t a better deal, but obviously the lenders know better. I’m just saying there’s lots of options. So, so

Tego:

I want to tie something into that exact, except my my computer just stopped working here. So I’ve got a little, so can you just kinda like talk while I’m

Speaker 3:

Trying to figure this out yeah.

Tracy:

In our market. So there’s a lot of different types of luxury, right? You’ve got all the stats on how much luxury has gone up. We think of luxury is like 500,000 and above here really is the top 10% of the homes sold price. And we know it’s probably more like five 50 or 600 and upright now because prices have gone up. But let’s think about where those houses are. Right. It’s everywhere. Right. We have luxury in Rio Rancho. We have luxury in Los Lunas in Berlin, all along the river. We’ve got Santa Fe. But when we say

Tego:

Luxury means different things. When we talk about luxury in, let’s say Los Lunas, for example, it could be a 10 acre parcel.

Speaker 3:

Yeah. Okay. Got it. Thank you. Yeah. I jumped ahead. I stole

Tego:

Your thunder. Yeah, no, no. I think it’s true. I mean, and then you’ve got the $2 million house or $3 million house on the open space or, you know, on, on Elena, in north Albuquerque acres or yeah. So it’s a variety or you’ve got the old hostage NDAA down in north valley or maybe corral us. Right. So it’s a whole variety when you talk about it

Tracy:

Is, and it could be, you know, 160 acres out in Edgewood with a really fine property and horse barn. And you know, so it, and water rights can play into value here too. So the price point for luxury could also include whether they have ancient water rights, right. Pre 1907, those water rights can be bought and sold, but there’s so many different home styles, so many different sizes of properties and so many different amenities that make it luxury in addition to price, back to luxury. Ah, okay. Some of the other things, yeah. You were listening to a couple of different podcasts other things that might be important to know about luxury. I know one of them is loans. So we have loan limits in New Mexico that are different than other parts of the country for what we call a jumbo loan and a jumbo loan is you know, over a certain lending over a certain dollar amount

Tego:

Right now. Sorry, it’s changed a lot lately. So I don’t remember for sure, but I think it’s around five and a quarter.

Tracy:

Yeah. I don’t know. But I just had somebody that you know, was, was looking at it and jumbo loans are different. Your credit score needs to be better to get a loan for a property over as you know, a loan over a certain year. Yeah.

Tego:

Loan over it. Yeah. Not, not the value of the property. It’s the loan, the loan amount. Yes.

Tracy:

Right. It’s in the low fives here in New Mexico. It varies at Santa Fe. It’ll be different because home prices are higher. Right. It’s not statewide community-wide so loans are different. But for for a loan that’s over a certain dollar amount, your credit score needs to be better. And the interest rate might be a little bit higher than what we’re seeing on a lower dollar loan. Right. To get that money and take it out of circulation from a banker.