New Mexico Housing Market

Learn more about the housing market in New Mexico

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New Mexico Housing Market Trends & Forecast

July 3, 2024

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Every state is unique when it comes to the real estate market. That’s why it’s critical to understand the market you live or operate in. Whether you’re renting, buying, or selling, it will impact many aspects of your life.  

New Mexico Housing Market Overview 

New Mexico is a unique southwestern U.S. state. From the state’s cold alpine climate in the northeast to the Rocky Mountains and warmer, arid climate in the southwest, New Mexico has a varied climate and geography. “The Land of Enchantment” is also home to ample tourism around several UNESCO World Heritage sites, especially at the ‘Four Corners’ region. 

Culturally, New Mexico is a blend of Hispanic, Indigenous, and North American influences. Economically, New Mexico focuses on cattle, agriculture, lumber, oil/gas tourism, and aerospace. The state also has a well-known military presence, including several federal research centers and the White Sands Missile Range.  

When it comes to the housing market, New Mexico is unique in that is has some of the cheapest land in the U.S. This is because over 48% of New Mexico is owned by the federal government, meaning that a lot of land in the state is available at much lower prices. New Mexico also has a relatively low population density, isolated from other population centers due to its challenging geography and remote towns. This makes New Mexico’s housing market substantially less competitive compared to cities in nearby states like Phoenix, Dallas, and Colorado Springs.  

However, cheaper prices do not entirely insulate New Mexico from the real estate challenges currently faced by the rest of the U.S. Although homes in New Mexico stay on the market longer than average, the state’s housing market is still considered seller-dominated due to low inventory. That inventory is improving, however, with the state’s housing supply at approximately 3.4 months, up 21.4% since May 2023. Home values in New Mexico have also increased by more than 5% since last year, contributing to the current nationwide housing crises fueled by higher demand, prices, and interest rates. 

The second half of 2024 could see New Mexico homeowners—and Americans more generally— getting some relief. Last year, one expert predicted that interest rates could drop as low as the 5% range, although we have yet to see signs of such a substantial drop. When rates do drop, as they are anticipated to later this year, sellers in New Mexico are anticipated to list more homes, meeting more buyer demand and easing inventory strain. 

New Mexico Housing Market Trends 

To understand the New Mexico real estate market, it’s important to keep up with trends. Let’s look at some key ones in New Mexico: 

Note: These statistics are based on Redfin’s monthly housing data from April 2024. 

Median Home Price 

The median sale price for a home in New Mexico is $358,800, up 5.1% since last year according to Redfin’s monthly housing data from April 2024. However, prices vary across the state depending on whether you’re looking at rural areas or more dense urban markets. In Santa Fe, for example, the median home price is much higher at $552,500. That being said, in New Mexico’s largest city, Albuquerque, the median price is actually slightly lower than the state median at $352K. 

Number of Homes Sold in April 2024 

Only 856 homes sold in New Mexico in April of 2024, up 16% since April of last year. New Mexico has one of the lowest home sales volumes in the U.S., in part because of its low population density. New Mexico is the 15th least populated state. 

Median Days on Market (DOM) 

Days on market (DOM) is a measure of the average length of time a home remains listed on the market before being put under contract. A lower DOM signals a highly competitive seller’s market with more pressure on buyers to make higher offers and remove contingencies. A higher DOM signals a buyer’s market as sales are slower and sellers have less leverage. 

The current median DOM in New Mexico is 43 days. This means homes in New Mexico spend, on average, more than a month listed before they go under contract, indicating a less competitive market. 

New Supply Statistics 

On average, there were about 3.66 new residential construction permits per 1,000 people in New Mexico in 2021. New inventory is growing more slowly in New Mexico compared to some of its southwestern neighbors, like Arizona, Utah, and Texas. An increase in overall housing inventory is expected to contribute to lowering home prices and demand across the U.S. in 2024. 

Property Tax Rate 

The average property tax rate in New Mexico is 0.67%, according to Rocket Mortgage. This places New Mexico’s average property tax rate as the 17th lowest in the U.S., with the average property tax bill in the state being around $2,880.87. However, keep in mind that property taxes vary widely depending on the specific county of New Mexico and the value of the home. 

Foreclosure Rate in Q1 of 2024 

In the first quarter of 2024, 1 in every 2,649 homes in New Mexico experienced a foreclosure filing (according to recent data from ATTOM). Based on this data, New Mexico foreclosure rate is below average compared to other states. 

Hottest Local Markets in New Mexico 

Below are a few of New Mexico’s hottest real estate markets in 2024: 

  1. Santa Fe

Santa Fe is home to arts attractions, cultural heritage sites, and year-round tourism. This city is a great place for vacation properties and other short-term rentals. It’s also an ideal city for appreciation, with a median sales price over $550,000 and significant growth in prices demonstrated over the past year. 

  1. Rio Rancho

Rio Rancho, an up-and-coming suburb outside Albuquerque, is one of the fastest growing areas in New Mexico. The area’s lower cost of living attracts both homeowners and real estate investors, making it an ideal spot for long-term real estate investing. Rio Rancho is also known for its colorful events and attractions as well as rich historical and cultural sites. 

  1. Albuquerque

New Mexico’s largest city features diverse nightlife, festivals, and cultural events, demonstrating its developing tourism industry and potential for short-term rental investing. Albuquerque is also a robust place for long-term rentals, with a relatively affordable cost of living and a median home sale price of 352K. 

Factors Impacting the New Mexico Housing Market 

A holistic view of New Mexico’s housing market requires a basic understanding of the main economic drivers affecting the market. Let’s look at a few critical ones below: 

Mortgage Rates 

High mortgage rates are a continuing challenge for would-be homeowners in the U.S. New Mexico’s average rate for 30-year mortgages in June of 2024 is 7.04%, almost the same as the current national average. Higher interest rates deter borrowing and discourage those who already own homes from putting their homes on the market. Many homeowners report feeling “locked in” to their current homes, as it is unlikely they will secure a mortgage rate as low as their current one on their next property. Prospective buyers in New Mexico should monitor mortgage rates in the coming months for a better understanding of how they impact the housing market. 

Inflation and Cost of Living 

Mortgage rates are tied to inflation, another massive contributing factor to the affordability of housing and the state of housing markets in general. Inflation has increased the cost of living for many across the U.S., including in New Mexico. This means fewer people can truly afford to limit housing costs to less than 30% of their monthly income. 

Population Changes and Demographics 

Population, employment, and migration all affect the housing market. New Mexico’s population is aging, with its senior population expected to increase by over 200,000 during the next 20 years. New Mexico also has a negative net domestic migration, meaning that more Americans are seeking to move out of New Mexico than to. The state has lost nearly 6,000 people since 2020. These population shifts will doubtlessly affect the prices and availability of homes, as properties will be sought by older generations rather than an influx of younger residents. 

Other Factors for New Mexico: Wildfires and Water Scarcity 

New Mexico’s housing market also faces climate and ecological challenges. Many New Mexico homeowners are struggling to secure homeowners insurance due to increasing risk of wildfires, especially in the northern part of the state. This problem echos similar wildfire concerns across the Western U.S., especially in California, where unthinkable losses have been suffered due to wildfires in the past several years. 

New Mexico also suffers from water scarcity. The state’s government is already taking steps to increase water security for its residents, but resource management will only become more critical if housing development in New Mexico is to continue at pace. Permits for new construction, which are important in increasing inventory and meeting buyer demand, will not be approved unless sustainable water supply can be accounted for. 

New Mexico Housing Market Forecast 

New Mexico’s housing market will likely remain stable in the rest of the year. As mentioned above, New Mexicans anxiously await interest rate cuts, as is the rest of the country, so that sellers are more willing to list their properties to meet buyer demand. Until then, prices will likely remain higher, although New Mexico homes are considerably cheaper than other states’ due to the large percentage of federally owned land. 

Likelihood of New Mexico Housing Market Crash  

A housing market crash is unlikely to occur in New Mexico this year. When demand is high and inventory is low, as currently is the case in New Mexico, conditions are not right for a housing market crash. Although the housing market certainly has other challenges, investors and homeowners in New Mexico can rest easy that a major crash is probably not in the cards for 2024. 

Forecast for The U.S. Housing Market 

Now that we’ve looked at New Mexico’s housing market, let’s zoom out a little bit. What about the U.S. housing market? What do you need to keep an eye on in the coming years? 

The United States’s current median existing-home sale price is around $384,500 per the National Association of Realtors. The inventory, though, remains low. A balanced market typically has a 5-to-6-month supply, but the current figure is 2.9. 

We’re currently in a seller’s market with buyers looking at continued rising house prices. The same trend can be seen with renters. Housing continues to appreciate, in general.  

Dr. Lawrence Yun, Chief Economist and Senior Vice President of Research, National Association of Realtors, believes the housing market will appreciate 15 to 25% over the next five years. He thinks that the seller’s market will continue because housing inventory will remain low. In five years, however, he predicts a more balanced market, in which neither party has a built-in advantage. Thus, the market will shift to a case-by-case basis to determine what kinds of deals people can get. 

Hybrid work also impacts the housing market. This shift in work culture means suburbia will continue to grow. States like Texas, the Carolinas, Tennessee, and Florida should see continual growth. 

The number of single-family homes built decreased over the past couple years while the number of multi-family homes increased due to lower prices and a demand for affordable housing. Higher mortgage rates and inflation (affecting price of materials) were the main causes.  

Lower income households continue to struggle in the current housing market. This trend appears likely to continue into the foreseeable future. Without enhanced supply or helpful subsidies, the outlook is that many Americans will still wrestle with housing affordability in the years to come.  

New Mexico Rental Market 

The rental and buying market are obviously closely linked. When home prices fall, landlords are more likely to buy properties to rent out. Home prices and rental prices are correlated as well because a hot market means prices rise.  

Rents were more unaffordable than ever in 2021 and 2022. In 2022, 22.4 million households paying rent said it was unaffordable, which is the highest that figure has ever been, according to a January report from the Joint Center for Housing Studies at Harvard University. The study found that half of all renters in the United States spent over 30% of their income on rent and utilities.  

The markets cooled in 2023, though, due to new units and decelerating demand. But a serious problem persists: Rent increases are still outpacing income gains.  

Moreover, high interest rates are keeping borrowing and transaction activity down. Over half the banks surveyed by the Federal Reserve reported that demand for multifamily loans decreased year-over-year. 

The pandemic caused a housing disparity that isn’t going away anytime soon. Unaffordable housing is a serious issue across America. Whether high rents or low income is the main cause doesn’t change the fact that this problem is widespread.  

This short summary leads directly into New Mexico’s current rental market, as informed by recent metrics from Zillow: 

New Mexico Rental Market Key Trends 

  • Median rent: $1,675 
  • Month-over-month rent change: -$75 
  • Year-over-year rent change: +75 
  • Available rentals: 1,924 


The New Mexico housing market in 2024 is marked by a blend of stability and challenges, making it crucial for potential buyers and sellers to stay informed about market trends. Whether you’re looking to purchase a home soon or sell your property in New Mexico, the macro- and micro- economic trends outlined above will affect your decision-making. Market dynamics like changes in home prices, inventory levels, and interest rates will continue to be critical for stakeholders in New Mexico real estate.

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