Real estate boom: how sweet it is - Residential Real Estate

New Mexico Business Journal, Dec, 1993 by Peter Eichstaedt

New Mexico is in a real estate boom. Realtors in every corner of the state report that the state is enjoying an unprecedented push in the business.

In Las Cruces, former agricultural lands are rapidly being graded into subdivision lots and cul-de-sacs; in Albuquerque, finding enough construction workers to meet demands turns out to be a sweet, but enjoyable task.

Santa Fe is thriving; an influx of new employees in a variety of small businesses in Roswell is buying up available houses; in Farmington and Gallup, some people have had to turn down jobs because housing is unavailable.

New Mexico, like many other western states from the Mexican border north to Montana, is reaping the real estate benefits propelled by a popularity that equates to the Great Western Gold Rush of yesteryear.

Hundreds of thousands of people are fleeing major urban areas of the East and West Coasts where crime rates are high, the air and water is polluted, unemployment surges and economics are generally depressed.

The result is that people are "trading down" in terms of dollars, but "trading up" for a higher quality of life where the pace is slower and where sunshine, clean air and the great outdoors are just beyond the back yard, not just some pretty scenery on the television set.

"We are part of the golden corridor," says Charlotte Gorbitz, a Las Cruces Realtor.

In the last two years, the largest single source of newcomers has been California, says Gorbitz. Most have come to Las Cruces because they landed a job in the area; another 30 percent came to retire; and a lot of those retirees came from New York or New Jersey.

Reasons for the move are understandable. The dry climate and low cost of living are major, followed by a low crime rate, ease of transportation and the small town atmosphere.

Home sales seem to be on an endless upward spiral, says Gorbitz. For the past eight years, there has been an increase in home sales -- and 1992 was the best ever in Las Cruces.

"It topped everything by leaping up 18 percent, with the largest market share going to residential sales.

"There's a lot of new construction," Gorbitz says. "In the outlying areas, there are new subdivisions going up every week." Most of the new homes are directly between home builders and buyers, she says, with just 30 percent through Realtors.

Gorbitz attributes the Las Cruces boom to a steadily growing economy with a variety of job opportunities, including activities at White Sands Missile Range, New Mexico State University, vast agricultural lands and growing retail sales since the city is the commercial center for southern New Mexico.

Low interest rates for home mortgages have helped, she says, particularly among first time home buyers.

But many, such as retirees, have bought homes before and are attracted to Las Cruces over such famous retirement centers as Tucson and Phoenix.

In Roswell, a similar housing market surge is being reported, according to Paula Grieves of the Grieves Group Realtors Inc. of Roswell.

"We've been a retirement community for 20 years," she says.

Statistics reveal that 111 retirement couples moved to Roswell in 1993; 66 of those couples purchased homes.

These couples say they visited Roswell and then other places in New Mexico and the region and came back to what they liked best. "Many feel that Roswell has what they wanted," says Grieves.

But retirees are not the only buyers fueling the Roswell market. The oil and gas industry is beginning to improve and this former staple of the Roswell economy is on the comeback.

More importantly, Roswell real estate is benefiting from a steady effort to expand and diversify its economy.

Already a center in the Southwest for the dairy industry, hundreds of jobs have been added with the expansion of a mozzarella cheese factory and the growth of Renown Aviation.

Future projections are optimistic and call for at least 110 new jobs every year for the next five years, Grieves says.

"We're feeling the effects right now," she says.

Besides a growing job market, Grieves says low interest rates have helped home sales, freeing up a pent-up demand.

In Farmington, Nancy Eaves of Dimmick Realty described a similar demand for new housing.

"We've had no rentals available for two years," she says, referring to single-family homes. Because some have been forced to buy houses instead of rent, they've chosen to leave the job and the community in search of more agreeable circumstances.

The result has been a steady growth in annual home sales in Farmington. Sales increased by $7 million in 1992 and the average home sale was $67,500.

The average home sale was up to about $80,000 this year, she says. "Our prices are going up. And we have no inventory."

Until this year, says Eaves, she's never had buyers without anything to sell them.

Recently Farmington saw a $1.4 million house built, the biggest and most expensive of its kind in the community's history, according to Eaves. "That's unheard of in Farmington," she says.

Eaves says the real estate growth is constricted by tight money availability in the community and the fact that a small percentage of the land in the region is privately owned.