Supply and Demand: What are the Challenges That’s Happening in Albuquerque’s Real Estate Market

Supply and Demand: What are the Challenges That’s Happening in Albuquerque’s Real Estate Market

Transcript Snippet: “Tego:
So I wanted to talk about, so, so we, we, we keep talking about the, the what’s going on in our market and this whole, the challenges between supply and demand, let’s bring it back to Albuquerque and what’s happening, uh, feed on the street as we speak here today, right on May 21st, 20, 22. And, and right now we have, um, more homes coming on the market in the last two weeks than we’ve seen in a long time. And that’s good news. That is not bad news. That is good news. We’re the, the it’s very common. And I’ve been talking about this for a few months now that the number of homes that come on the market, we generally get a surge this time of year and it’s happening again, of course, in, uh, 2020, we did not get that surge of new homes coming on the market.
Tego:
And, and that really set us back, but we’re starting to see more homes come in the market. So that is good news for home buyers. Uh, interesting thing that’s happening is, uh, home prices continually are getting pushed up higher and higher and higher, uh, something that’s happened just in the last few weeks though, is a number of homes, uh, taken a price reduction, not selling immediately. Like they, they were and taking a price reduction has gone down, but that’s like saying, um, you know, it’s like the jewelry store, the everything’s 50% off. Well, yeah, I mean, everything’s been marked up so high that maybe some people are getting ahead of themselves on home pricing. So if you’re thinking of selling or you’re getting ready to list your home for sale, think about the pricing and make sure you’re getting the right strategy, uh, in, in place for that price.
Tego:
So you’re not getting ahead of the market. If you will, on your price. Obviously you want to get the most you can for your home. You know, Eddie, there’s a lot of different strategies in that. Some people, uh, think it’s better to, you know, come in on the market, maybe right at the market, you know, what the, what the data’s telling us, or, or maybe a little bit below the market based on what the da data’s telling us and let, let the market push it up, you know, create the auction effect. And, and we’ve had that auction effect now here for the last couple years in our real estate market, uh, where, where homes are going over, list price, you know, last time I looked, um, 50% of the home. Well, in fact, yeah, no, that was the April data. 50% of the homes sold for over what the listing price was. But like, like I just said, there, there have been some price reductions recently, and I think that’s just, you know, you can’t keep pushing it up and up and up and up. Um, not saying that prices are gonna slide backwards. It’s just, you know, everybody wants to get the most they can for their home. I understand that. So, yeah.
Eddie:
Yeah. Yeah. I think there’s a, there’s this is a, a complicated adventure. Um, but the last thing you wanna do, uh, folks out there as a home buyer, uh, without expertise. Um, so Hey, you know, yeah. I’ve made a lot of money in my time in real estate. Like I got this, no, I don’t need a realtor. I’m gonna F for by owner this all say, I’m gonna time the market, the right. So am I made another six months? Like they start talking themselves into all this, you know, psycho psycho in real echo BBA in real estate like, oh, whoa, bro. Uh, you might wanna look at stats, there’s actual facts and numbers in history. And, uh, we can go back, you know, 12 quarters, 12 years, 12 months, whatever we need to do. But I think you need to pay attention to the data that will be indicate. Plus at the very same time, you need to be with people who are actually transacting stuff. And I won’t tell
Tego:
You, so I got, let me, let me just interject something right in there. Cuz you were talking about that. I can’t tell you how many times I’ve heard over the last couple years since the pandemic. Right. And all the, the fear and you know, everything we went through, right. I don’t wanna rehash that, but you know, there was a lot of fear. Um, how many people said, I’m gonna wait for the housing crash before I buy a home and those people are still sitting on the sideline. Yep. And, and the, the thing is the people that bought a home a year ago, a year and a half ago, there was an analysis done and they did a whole bunch of cities. And what they’re they’re looking at is how much home prices have gone up, how much interest rates have gone up over the last year.
Tego:
And we’re seeing numbers like 60% higher, your, your monthly payment is 40 to 60% higher than it would’ve been just a year ago because of the, the surge interest rates and the surge in home prices. So, uh, unfortunately people that were, have been on the sideline, um, I’m sorry. and if you’re waiting for the, the, the next surge of, of foreclosures, I, I just wanna address that cuz people still think that’s a thing. They still think there’s gonna be this surge of, of distressed homes coming on the market. It it’s not happening. They’re they’re not there. They’re not in the pipeline. I mean, there’s a few, there’s always gonna be foreclosure, but the number of homes in a, a delinquency status, which means, you know, 30 days past due or, or more is at an all time low right now, now nationwide.
Eddie:
Um, on that, I’m gonna add to what Tego is saying is cause there’s a company called BlackRock. Yes. And, um, people need to understand, you
Tego:
Know, well it’s more than just them, but yes, go ahead. I’m sorry. But they’re, they’re the poster child. Yeah.
Eddie:
Well you can get into Zillow and you get in and they’re literally just picking up and buying neighborhoods. Right? They’re doing one offs they understand. And what they understand is exactly the very thing that struck us back in eight. It’s not a bubble. It’s something that’s entirely different. It’s marked it’s market to market. It’s only in places that are right for this type of thing where you can almost have a CCNRs, um, of an entire city, which is what’s gonna happen in Boise or what’s gonna happen in a place like queen Creek. Well, that culture will be homogenized, but they’ll also basically keep all hard to say it all the same prices because they’re not gonna allow each other’s prices to go down. So if you wanna end up living that neighborhood, it’s gonna be that much and you’re paying for it, which is why you see, uh, such a, a big price discrepancy.
Eddie:
Here’s how BlackRock plays into this. As they remember what the home builders did like to brothers and KB homes and all the rest of what happened back in remember clear day, I was living in the midst, this guy, Eddie, he’d say, yeah, I’m gonna buy this, uh, track of a hundred home, which you could do. He did it. And it was all stated income stuff. And then he got blown up. It was kinda crazy. Well, prevented that from happening more stated, incomes, people just go and homes like any longer. So what KB and brothers and the rest of decided that we’re not gonna let this happen again. Cuz you’ve seen home builders or stocks. They’re barely going up. They’re playing on the little margin. Tell me if I’m wrong on any of this go, correct?
Tego:
Nope. You’re right on. You’re right on track. Yep.
Eddie:
It’s like this or we’re not gonna go ahead and expose it. We got hurt. We got our asses handed to us. This was not fun. It took us X amount of years to, to recover, which I don’t even think they had. None of them turned a profit until 2016. That’s how much money they lost. And they got escorted by, uh, Countrywide, et cetera.
Tego:
Now we, we, without a doubt in, in, in, I just wanna address that because it’s a really important point. We overbuilt in oh 5 0 6 0 7. We overbuilt in, in Albuquerque, in the entire country. And now we’ve underbuilt for the last ever since 2009 mm-hmm . And, and even now in the last few years, or let’s say last year, there’s been a surge in, in permits, but um, completions are still really low because of all the other challenges, supply chain, labor, cost materials, name it on and on and on mm-hmm so if we think we’re gonna build ourselves out of this housing shortage, it’s gonna take a long time
Eddie:
A generation.
Tego:
Yeah.
Eddie:
I think, I think we’re looking at during the time from oh seven to right now, which is 15 years, it’s gonna take probably another three years for it to all even out, uh, from under overbuilt to underbuilt to even, and that brings up my next point.