First Time Home Buyers | Albuquerque Real Estate

Housing Affordability Issues in Albuquerque

Feb 10, 2024 | Albuquerque Home Values, Albuquerque Real Estate News, Albuquerque Real Estate Talk, First Time Home Buyers, Housing Market Updates, New Construction

Unpacking Albuquerque’s Housing Affordability Issues: ABQ Real Estate Talk February 10, 2024

Albuquerque Real Estate Talk 479 – February 10, 2024

As experienced Albuquerque Realtors, we aim to simplify the complex dynamics of the Albuquerque real estate market for our clients and listeners. In the latest episode of Albuquerque Real Estate Talk, Episode 479 – February 10, 2024, Tracy and I explore essential topics for anyone navigating the housing market, incorporating both local and national perspectives, and we take a deep dive into Albuquerque Housing Afforability.

The Reality of “Shrinkflation” in Housing

We delve into the phenomenon of “shrinkflation” affecting the Albuquerque housing market. Despite homes becoming slightly smaller, prices are not decreasing. I found a 10% drop in the MEDIAN price of new construction homes from 2022 to 2023; however, the cost per square foot remains constant due to the reduced size of these homes.

Affordable Housing Initiatives

We talked about a topic this week by a national builder in Texas, who has 600-square-foot new homes priced between $145,000 to $160,000, sparking a debate on social media because they are very small and not super attractive. Despite the criticism, we discuss the value of such homes in Albuquerque, where affordable, financeable homes are scarce.

Understanding the Full Cost of Homeownership

Since Townhomes and Condos can seem like a great value when looking at a price only, we emphasize the importance of considering all costs associated with purchasing a home, including interest rates and HOA fees, in particular since a $300/mo HOA fee is equal to $40-$45k home price.

Rental Trends and Co-living

A trend we have seen recently in Albuquerque is the shifting rental prices, with rent price decreases for smaller apartments and increases for larger ones, leading to more people co-living based on what we hear from property managers. We also introduce CoBuy, a company offering solutions for co-buying property, addressing the affordability challenge.

Land Development and Regional Comparisons

Discussing land development, we note that a ready-to-build lot in Albuquerque costs around $100,000; with land development times of 2-3 years, building new affordable homes is challenging.

Legislative Efforts and the Affordability Struggle

I like that New Mexico’s legislative is making efforts to improve housing affordability. Still, there is a need for comprehensive solutions beyond financial aid, including builder incentives and infrastructural support.

We Are Here to Help with Your Albuquerque Real Estate Needs

Despite the challenges discussed, the Venturi Realty Group remains dedicated to assisting clients through the buying or selling process. For those considering entering the Albuquerque real estate market, we invite you to reach out for expert guidance.

Great News About Housing Inventory [INFOGRAPHIC]

Jul 22, 2022 | First Time Home Buyers, For Buyers, Housing Market Updates, Infographics, Move-Up Buyers

Some Highlights

Experts say the number of homes for sale is growing this year, and that can have a big impact on your move.
If you’re planning to buy, additional options in today’s market may be just what you’ve been waiting for. More inventory means added opportunities to find the home of your dreams.
Let’s connect so you have the latest information on available homes in our area.

Why Pre-Approval Is a Game Changer for Homebuyers

Jul 19, 2022 | First Time Home Buyers, For Buyers, Move-Up Buyers

If you’re planning to buy a home this year, you might have heard that pre-approval is a necessary step to take before starting out on your journey. But why is that? And is it still important in today’s shifting market?

The truth is, getting a pre-approval letter from your lender is critical, and when it comes to your home search, it can be a game changer in so many ways.

To better understand why, it’s important to know what pre-approval is. Freddie Mac defines the process like this:

“A pre-approval is an indication from your lender that they are willing to lend you a certain amount of money to buy your future home. The lender you work with will provide you with a pre-approval letter, which is an official document that states the maximum amount they are willing to lend you, . . .”

Put simply, pre-approval from a lender helps you understand your true price range and how much money you can borrow for your loan. That can make it easier when you set out to search for homes. And since you’ll know what you’re approved for, it’ll also help once it’s time to submit an offer on the home of your dreams.

Another added benefit is that pre-approval lets the seller know you’re qualified to buy their house. Paul Centopani, Editor for the Mortgage Reports, explains:

“. . . most sellers won’t even consider an offer unless the buyer is pre-approved at the right price point. Sellers and their agents want to know you’re ready and able to finance your offer amount. So you’ll want to have your preapproval teed up as soon as you’re serious about bidding on a home you like.”

Every advantage you can gain as a buyer is crucial in a market that’s constantly changing. You’re going to need guidance to navigate these waters, so it’s important to have a team of professionals, such as a real estate advisor and trusted lender, on your side. They’ll help make sure you’re ready to put your best foot forward.

Bottom Line

Getting pre-approved for a mortgage helps you better understand what you can borrow and shows sellers you’re serious about purchasing their home. Let’s connect so you have the tools you need to succeed as a homebuyer in today’s shifting market.

Should I Rent or Should I Buy? [INFOGRAPHIC]

Jul 15, 2022 | First Time Home Buyers, For Buyers, Infographics, Rent vs. Buy

Some Highlights

It’s worth considering the many benefits of homeownership before you make the decision to rent or buy a home.
When you buy, you can stabilize your housing costs, own a tangible asset, and grow your net worth as you gain equity. When you rent, you face rising housing costs, won’t see a return on your investment, and limit your ability to save.
If you want to learn more about the benefits of homeownership, let’s connect today.

Should I Buy a Home Right Now?

Jul 13, 2022 | First Time Home Buyers, For Buyers, Housing Market Updates, Move-Up Buyers, Pricing

If you’ve been thinking about buying a home, you likely have one question on the top of your mind: should I buy right now, or should I wait? While no one can answer that question for you, here’s some information that could help you make your decision.

The Future of Home Price Appreciation

Each quarter, Pulsenomics surveys a national panel of over 100 economists, real estate experts, and investment and market strategists to compile projections for the future of home price appreciation. The output is the Home Price Expectation Survey. In the latest release, it forecasts home prices will continue appreciating over the next five years (see graph below):

As the graph shows, the rate of appreciation will moderate over the next few years as the market shifts away from the unsustainable pace it saw during the pandemic. After this year, experts project home price appreciation will continue, but at levels that are more typical for the market. As Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), says:

“People should not anticipate another double-digit price appreciation. Those days are over. . . . We may return to more normal price appreciation of 4%, 5% a year.”

For you, that ongoing appreciation should give you peace of mind your investment in homeownership is worthwhile because you’re buying an asset that’s projected to grow in value in the years ahead.

What Does That Mean for You?

To give you an idea of how this could impact your net worth, here’s how a typical home could grow in value over the next few years using the expert price appreciation projections from the Pulsenomics survey mentioned above (see graph below):

As the graph conveys, even at a more typical pace of appreciation, you still stand to make significant equity gains as your home grows in value. That’s what’s at stake if you delay your plans.

Bottom Line

If you’re ready to become a homeowner, know that buying today can set you up for long-term success as your asset’s value (and your own net worth) is projected to grow with the ongoing home price appreciation. Let’s connect to begin your homebuying process today.

The Drop in Mortgage Rates Brings Good News for Homebuyers

Jul 11, 2022 | First Time Home Buyers, For Buyers, Housing Market Updates, Interest Rates, Move-Up Buyers

Over the past few weeks, the average 30-year fixed mortgage rate from Freddie Mac fell by half a percent. The drop happened over concerns about a potential recession. And since mortgage rates have risen dramatically this year, homebuyers across the country should see this decline as welcome news.

Freddie Mac reports that the average 30-year rate was down to 5.30% from 5.81% two weeks prior (see graph below):

But why is this recent dip such good news for homebuyers? As Nadia Evangelou, Senior Economist and Director of Forecasting at the National Association of Realtors (NAR), explains:

“According to Freddie Mac, the 30-year fixed mortgage rate dropped sharply by 40 basis points to 5.3 percent. . . . As a result, home buying is about 5 percent more affordable than a week ago. This translates to about $100 less every month on a mortgage payment.”

That’s because when rates go up (as they have for the majority of this year), they impact how much you’ll pay in your monthly mortgage payment, which directly affects how much you can comfortably afford. The inverse is also true. A decrease in mortgage rates means an increase in your purchasing power.

The chart below shows how a half-point, or even a quarter-point, change in mortgage rates can impact your monthly payment:

Bottom Line

If your home doesn’t meet your needs, this may be the opportunity you’ve been waiting for. Let’s connect to see how you can benefit from the current drop in mortgage rates.

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