New Mexico Real Estate Picture Uncertain

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New Mexico Real Estate Picture Uncertain

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New Mexico is, according to their motto, "The Land of Enchantment". Proving that point, the state has not seen quite as many problems from the economic melt down as other states. Unemployment is currently almost 1.5 percent below the national average, due in large part to over 20 percent of New Mexico jobs held by government employees.

The states housing market, aided by the federal government's tax credit, is doing slightly better than other states. The first time buyer tax credits along with lower mortgage rates, has fueled a recent increase in home sales. Even with the incentives, inventories remain at relatively high levels as more foreclosures continue to come on the market.

However, without continued government incentives and assistance, New Mexico's inventory of homes will likely see further price erosion. In the Albuquerque area, the forecast is for home prices to decline around 9 percent this year. The Albuquerque metro saw huge growth during the boom and now has a bulging inventory of distressed properties.

In the southern part of the state, Las Cruces is not out of the woods either. Due to foreclosures, Las Cruces also has a large inventory of homes with prices that are now reaching bargain levels. Buyers have a wide variety of properties to choose from and prices will remain low even though sales volume is expected to increase.

Santa Fe has suffered the worst of the housing collapse. Prices have dropped like a rock as vacation property owners are simply walking away from homes. The good news, due to the federal tax credit, is sales are improving in the lower range of the market. Sales of high-end homes are dismal at best.

In New Mexico approximately 1 of every 5 mortgage holders are behind on their payments. As prices continue to erode and homeowners see their equity evaporating, many will choose to simply give up the fight. With homeowners relinquishing and giving up their properties, New Mexico real estate has a long way to go to reach a point of stabilization.

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Tags: • equity • homeowners • payments • albuquerque • foreclosures • mortgage • property owners • vacation property • las cruces • distressed properties • home prices • home sales • mortgage rates • tax credit • housing market • real estate • new mexico • first time buyer • mexico real estate •

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