High-end houses: State of the Albuquerque luxury housing market

High-end houses: State of the Albuquerque luxury housing market

(Transcript Snippet): “Tego:

Talking about, you know, the state of the housing market. There was a story in the Albuquerque journal, local, you know, talking about what’s going on in a housing market. And they highlighted some of the stuff that, you know, we’ve been talking about for a long time. One of them is at the high end market is very, very strong in Albuquerque and there’s been very, very strong sales in what we call luxury market, which has probably 500,600,000 and above somewhere in that that’s been a moving target actually, because it’s moved so so much lately. One of the things I found interesting, there was a quote that said that the movie industry, a lot of movie industry buyers coming into our market and I’m thinking about our team and we’re the biggest team in Albuquerque

Tracy:

Selling the most homes. Anybody. Yeah.

Tego:

Yeah. And, and, and I’m like, I don’t, I don’t really see a lot of, you know, movie industry executives or, or high-end people coming here buying a home. That seems like a lot of the rental market is driven by the house by the, excuse me, the moving industry the movie industry. And so, I dunno, I just, I see those things and I go, you know, talking about high-end yeah, it’s like talking about the high end market and how busy it is and that, you know, we’ve got a lot of people moving here from, for the movie industry in tying those two things together. I just, I don’t know that that doesn’t exist, that I know of

Tracy:

To give a little perspective. We’ve helped over 375 people in the process of buying a home or already bought or sold a home. And I can think of one person that maybe was a tied to the movie industry of all of those. Now, I wouldn’t know everything because we’ve got a whole team, but nobody here resonates with that. Yeah,

Tego:

Yeah, yeah. Nor do I, and we don’t want to get Eddie started on the movie industry. That’s a whole nother conversation.

Tracy:

So the other thing is we hear all these people are coming from California. And again, you know, there’s, there’s no statistics to prove that and, and we don’t see it. And we would, we wouldn’t feel it,

Tego:

The biggest driver to the housing boom in, in the Albuquerque area. And it’s the same as everywhere else in the country for the most part is just people that live here that want to be homeowners that weren’t homeowners before. And, and then you’ve got the, those, you know, the, the move up buyers that are buying the bigger house. So we are seeing that, you know, some of, most of the luxury sales in Albuquerque are people that aren’t from here that live here that already had a house. Maybe, you know, their home prices have gone up 25% in the last three years. It’s like, shoot, let’s take that and move that into that dream house that we always wanted. Interest rates are at an all time low. Right. I want to, can I just say, I just want to make sure I don’t have any data to back that up. I’m just telling you that for the most part, it does appear most of the home sales are people from here.

Tracy:

So I will say there has been one segment that I have noticed a few, few transactions that are tied together and that’s Intel. We’ve seen, we’ve seen some people moving here for Intel and, and buying homes. I wouldn’t say they’re all luxury buyers. So we have, I haven’t seen at least one luxury Intel buyer. But the rest are buying what everyone else is buying our median price home in Albuquerque and Rio Rancho. So we have seen a few in an influx there more than I would say on the movie industry.

Tego:

Just a couple more things on the housing market, just overall in Albuquerque, the th the home prices this time of year, traditionally what we call flatten out, where they don’t continue to re rise quite as much in net. It has been true here in the last, let’s say eight weeks, it’s the home prices have somewhat flattened out.

Tracy:

So this topic is our home is our art. Is the demand pulling back. Are we seeing the change in our market?

Tego:

And I would answer that two ways. Yes, we are seeing a change and that’s normal,

Tracy:

Right? I’m like, this is a topic in and of itself. This is seasonally normal. We’ve got kids going back to school this week. We’ve got parents figuring out childcare. We’ve got people focused on what normally happens is time of year. So

Tego:

I saw a story that was, you know, buyer demand, you know, are we still in having bidding wars? And it’s like, well, are the bidding war slowing down? Yes. For, for, for homes. Are there still bidding wars? Absolutely. Are we getting, you know, five offers instead of 20 offers? Right? So yes, the market slowing, no, th th the traffic is strong. I have a stat that shows the number of showings. There are what we call foot traffic in the Albuquerque area. It’s just as strong as last year. It’s just as strong as 2019. You know, the, the, the home buyers are out there. The other stat that I watch is just talking about demand is loan applications, mortgage loan, applications, and mortgage loan applications have come down. So you might see some headlines that say, oh, mortgage applications are down well down versus last year where they were just off the hook, but historically they’re still above averages. Historically, we still have a lot of buyers out there. Buyer demand is not waning. And if anybody tells you otherwise, they’re the, I don’t know what they’re looking at, but they, that, that data is an out there. The other thing, if anybody, somebody

Tracy:

In the grocery store line or something, they didn’t, they don’t have the stats that you look at. I mean, the truth is there’s

Tego:

A lot of YouTube or prognosticators on all different things, you know, economy, whatever. And some of them get on there and talk about the, you know, the, the impending housing bubble and the bubble is going to pop. You gotta, you, you, if you’re listening to that, and you’re believing that you got to understand that they’re living, leaving something out. And usually the thing they’re leaving out is demographics. And that we have the largest population in the country are in the late twenties to early 30 ages age, and they don’t own homes,

Tracy:

And they’re going to be home buyers. And

Tego:

We’ve got a 13 year under building of homes in the whole country, 13 years, we’ve, we’ve under built the number of homes. I saw something just the other day, just on the Albuquerque market. They were saying like Rio Rancho, there’s like 7,000 homes, short integrator Albuquerque area could be as many as 15 to 20,000 homes short for, for a, you know, a healthy market. Right. And in the problem we have right now, the, the, the one problem we do have home prices are going up at a really fast pace. And that’s, that’s not good for anybody. I mean, I take that back. It’s great. If you’re a homeowner and, you know, you want to sell and you don’t have to buy anything. Right.

Tracy:

Or if you’re a homeowner and you need some resources because you have equity. Yeah, exactly, exactly.

Tego:

So, so anyway, just, you know, there, there is one story I said, there, there are some supply challenges or continues to be supply challenges in the housing world. And, you know, there’s actual just the building materials as a problem, but a new story I just saw, or a research, I just saw, they looked at the let me find this study here, but basically what they’re looking at as the supply of lots, that’s the finished lots that you can build a home on. It was like an all time low nationwide. It was down 35% versus last year, which was already down. And so, you know, if we think we’re going to build our way out of this housing supply shortage, it’s going to take a while to work out. Right. The one thing I will say, let me just leave, leave off with this is if we see mortgage rates go above 4%, let’s say maybe four and a half, 5%, that will slow down the housing market. But until we reach that, I don’t see it changing. Okay.