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Published 27 August 2022
Media outlets of all shapes and sizes have been consistently reporting on the effects the current economy is having our nation’s real estate markets. An Aug. 24 CNBC headline read “Home prices fell for the first time in three years last month — and it was the biggest decline since 2011.” Bloomberg topped an Aug. 22 article with “House prices are being slashed in former pandemic boomtowns.” And, if that’s not depressing enough, the National Association of Realtors declared on Aug. 23 that “New home sales plummet as the housing recession gains steam.”
While the prognoses for residential real estate in general ranges from troublesome to dire, conditions differ depending on where in the country one lives. While cities such as San Jose, California and Seattle, Washington, which have experienced price declines of 10.0 and 7.7 percent, respectively, over the past few months, the median price of a Las Cruces home has held steady for the past two months at around $290,000, according to an Aug. 24 report from the Las Cruces Association of Realtors.
The prospect of a decline in our median price going forward is dependent upon the number of buyers in the marketplace in relation to the number of homes for sale. While our local inventory of new and existing homes, townhomes and condominiums has doubled over the past few months, from around 160 to approximately 320, the number of pending sales in line to close over the next two months remains strong at just under 300 units.
Another indicator of change occurring in Las Cruces is the rate of appreciation. The median price of all new and existing homes, townhomes and condominiums sold in March of this year was 28.6 percent higher than the median price reported in March 2021. Fast-forward to last month when the year-over-year rate of appreciation declined to just 5.1 percent, indicating that buyers are beginning to gain an advantage over some sellers. I say some sellers because there are still not a sufficient number of “best homes for the money” to satisfy the number of buyers wishing to purchase them, perpetuating a seller’s market in that category.
So, what’s ahead for Las Cruces-area buyers and sellers? Until two years ago, local Realtors typically booked 56 percent of their sales in the spring and summer “selling season”. The high demand for properties over the past two years perpetuated strong sales as if the fall and winter never existed. Given the economic clouds ahead, this may be the year sales statistics return to their former pattern. Should that be the case, it is entirely possible that values could decline a bit over the winter.
See you at closing.
Gary Sandler is a full-time Realtor and president of Gary Sandler Inc., Realtors in Las Cruces. He loves to answer questions and can be reached at 575-642-2292 or Gary@GarySandler.com.
About author
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About Author
Gary Sandler
