First Half of Year 2025

Unit sales and dollar volume are both up.

For the first half of 2025, the number of closed sales was 112 this year vs. 101 last year, an increase of 11 sales (+10.9%). Dollar sales were up by 13.5%. Median price is exactly the same as last year ($550,000), and average price is up 2.3% at $593,700.

In 2024, the steady downturn that started after the market surge of 2020-2022 may have bottomed out. It’s looking as if 2025 will continue to show a slight increase in unit sales, with prices not changing much. Inventory is increasing but the number of buyers is not; therefore the large imbalance in supply and demand that existed for the past 4-5 years is moderating. People are not as gung-ho about buying, and those who are seriously looking are being more selective about homes and pricing. Buyers are finding some room to negotiate price and terms. During the boom almost everything in reasonably good condition was selling at full asking price–or higher. These days, we are seeing many listings go through one or more price reductions before they sell.

Median and Average Prices

The median price (midpoint in the range of sales prices from lowest to highest) for the first half is $550,00—exactly the same as last year at this point in time. The year-to-date median is 3% higher than the 2024 full-year median of $532,500.

The average (mean) for the six months is $593,700 this year vs. $580,100 last year, an increase of $13,600 (+2.3%). Here is how median and average prices have changed since 2016:

Since 2020, when the market surge started, median price has increased 60%; the average is up 49%. In addition to the overall price level rising, there has been an increase in the proportion of sales of higher-priced homes. Buyers coming to Taos who sold a home in more expensive markets (e.g., California), or who had big gains in the stock market, could afford pricier homes here. Just looking at the $1 million+ segment, the number of sales increased from 4 in 2019 to 33 in 2022 before coming down to 21 in 2023, and 17 in 2024. The highest sale price in 2024 was $2,575,000 for a home at Taos Ski Valley. So far in 2025, there have been 9 sales over $1 million.

Price Discounting

Through the first six months of the year, actual sales price averaged 5.7% less than the asking price when the home when under contract; it was 11.6% less then the initial asking price when the home was first listed. For the full year 2024, these discounts were 3.6% and 9.4%, respectively. The chart below shows that the discounts were lowest in 2022 at the height of the boom, and have been trending higher since then. This year’s jump to 11.6% is a clear indicator that the market has softened, and that buyers have leverage to negotiate. Sellers who are pricing homes as if the market is as strong as it was in 2020-2022 are finding out that this is not a good strategy.

Days On Market

For the first 6 months of 2025, the average number of days from the start of a listing to when the house went under contract is 131. For the full year 2024, average DOM was 127. DOM dropped dramatically from 2013 through 2022 as demand outstripped supply. It started creeping upwards in 2023. With inventory starting to increase, and with people less eager to buy, this metric will probably continue to go up. Note that in Taos, average time to sell has always been much higher than in many parts of the country—where homes typically sell in 30-45 days.

Inventory

At the time this report was prepared, there were 283 homes listed for sale, up 65 houses (+30%) from three months ago, and up 86 houses (+44%) from a year ago, when inventory was at a low point. It appears that more homeowners are deciding that it is time to sell. They have either decided that they really want to move, or they are are afraid that if the market weakens they won’t be able to sell–at least not at a price they want.

Current inventory of 283 is still way below what was typical before the inventory starting shrinking in 2009. (In September of 2008 there were 518 homes on the market!) Taos inventory consists of a wide variety of size, price, style, location, and condition — everything from mobile homes to luxury homes, spread out over a large geographic area. With listings increasing, it is becoming a little easier to find more than just a few homes to show a buyer that meet most of his/her criteria.

Home Purchase Financing

Please Note: These data do not include any condominiums developed or offered for sale by Taos Ski Valley Resort; those condos are not listed in the Taos MLS.

Condo sales are the same as last year.

For the first six months of 2025, unit sales were equal to the same period in 2024, at 24 condos sold. Dollar sales were down 5.5%. Whereas the inventory of single-family homes is growing, condo inventory remains very limited; this will constrain sales. We expect this year’s sales to continue to track the same as last year.

2006 was the high-water mark for condo sales, when 149 units sold. There was much more inventory for buyers to choose from back in the early 2000’s.

Median price for the first 6 months was $400,000 vs. $385,800 in 2024, an increase of $14,200 (+3.7%).  Average price was $433,500 vs. $458,600, a drop of $25,100 (-5.5%).  In a small data set with only 24 transactions, a few sales can skew the average price dramatically. The median is a more reliable indicator of price trend. As the year unfolds, we expect the median to show that prices are not falling from last year, and they may increase slightly; the average will probably get more in line with last year.

Price Discounting

Through the first half of this year, final sales price averaged 3.4% less than the last asking price when the property went under contract, and 4.6% below the initial price when the property was first listed. Full-year 2024 discounts were 3.0% and 4.7%, respectively. Condo discounts are less than those for single-family homes (which were 6.2% and 10.4%, respectively, in Q1), reflecting an even tighter inventory for condos than for homes.

Days On Market – For the first half of this year, DOM averaged 95 vs. 108 for the same time frame in 2024, a decrease of 13 days (-12%).

Inventory

The number of condos listed for sale at the time of this report was 38, up 9 from three months ago, and up 4 a year ago. Of the 38 condos currently listed for sale, 7 are at Taos Ski Valley; 31 are in and near central Taos, with one of those under contract. Those 30 available condos range in price from $289,000 for a 1-bedroom/1-bath, 538-square foot unit in central Taos to $899,000 for a 3BR/2BA, 2189-sq. ft unit with a 2-car garage also close to Town center.

In 2005-2006, when condo development was at its peak, there were often approximately 200 condos on the market at any given time, with the majority in or near central Taos. There were 149 condos sold in 2006. The table below shows a steady decrease in average inventory for each year from 2013 to 2023, and not much increase since then

Foreclosure Sales

There have been no foreclosure sales of condos so far in 2025. There were none in 2024, 2023, 2022 or 2021.

Multi-family sales are down substantially so far in 2025.

Multi-family sales have fallen off a cliff! For the first half of this year, there has been only one multi-family sale, whereas last year there were 8 during the same time period. No doubt this is due to higher interest rates affecting investors’ ability to achieve a satisfactory rate of return.

In an economy of higher interest rates, investors normally require higher “capitalization rates” to evaluate real estate investments. Investors divide a property’s Net Operating Income by their desired cap rate to calculate the price they will pay for the property to achieve the target rate of return. The higher the cap rate, the lower the value of a property. Although rents had been trending higher for years—due to an acute lack of inventory of long-term rental properties— rent increases appear to be moderating, despite the fact that very little new supply of rental properties has come on the market.

There is huge need for affordable housing—i.e., apartments—but “making the numbers work” in Taos has always been a challenge. For new construction, the high cost of land in suitable locations combined with high costs for materials and labor, make it difficult to achieve a reasonable rate of return.

Multi-family has always been a very small segment of the Taos real estate market; it will remain so.

Currently, there are 9 multi-family properties listed for sale; two have sales pending.

The land market is weak.

Land sales continue to decline. For the year through June, the number of sales was 67 compared to 97 for the same time period in 2024, a decrease of 30 tracts (-30.9%). Total dollar sales were up 12.2%, but that was due to one sale this year: 11.47 acres on the main commercial thoroughfare sold for $3 million. Excluding that sale, this year’s total dollar sales were 12.5% less than last year.

The primary constraints on land sales are very high building costs and the long lead time to start and complete construction of a home. There aren’t a lot of really good builders in Taos, and they are booked up for about two years. It costs at least $400 per square foot for the hard dollars of construction; this doesn’t include the land purchase, possible well drilling, septic system installation, and landscaping. It generally costs more to build a new home than to buy an existing home. The potential for costs to rise more, due to tariffs, could further impede land sales.

Land sales were relatively strong in 2021 after years of weakness following the Great Financial Crisis of 2007-2008. Unit sales in 2021 were up 69% over 2020–although the number of sales was still 27% fewer than peak year 2005. In 2021, during the Covid pandemic influx, some buyers who were frustrated in their search for an existing home to buy (due to the low inventory and intense competition with other buyers) decided to buy land and build. 

Then In 2022, the sales pace slowed as buyers realized how long it would take and what it would cost to get a home built. Total closed sales for 2022 were up just 6 units over 2021 (258 vs. 252). In 2023, land sales decreased, along with all the other segments of the real estate market. In the full year 2023, 210 tracts sold, a decrease of 51 units (-20%) from 2022. The down trend continued in 2024 with just 186 sales. We don’t expect much of an increase in 2025. Building costs certainly haven’t come down, and inflation seems to be sticky at current levels.

Back in peak year 2005, in the boom leading up to the GFC, there were 339 land sales, with a total dollar value of $46 million. Whereas sales of single-family homes had got back to the peak level of 2005 by 2021-2022, land sales are still way below the levels of 2004-2006.

Price Level – This year’s So the following data on median and average price should not be taken as valid indicators of the price level. We think that prices are flat or dropping moderately.

Median price so far this year is $95,000 vs. $75,000 last year, an increase of $20,000 (+26.7%). Average (mean) price this year is $202,800 compared to $124,800 last year. Obviously, the $3 million sale noted above skewed the average. Excluding that sale, this year’s average was $160,400—still up 29%. The sales “mix” may include relatively more sales in the higher price brackets this year. It is hard to make a case that land prices are rising.

Current inventory of 386 tracts listed for sale is up 43 (+13%) from the beginning of the year, and up 21 (6%) from a year ago. Land inventory has fluctuated over time, but it has consistently been in the 350-450 range. That is much more supply than there is demand for.

Price Discounting

For January – June, actual selling price averaged 5.7% below the last asking price when the property went under contract; the discount from original price when the land was first listed 10.7%. For full year 2024, these discounts were 8.0% and 10.9%, respectively. In 2023, they were 8.8% and 12.9%. Whereas in the market for homes and condos there is much more demand than supply, in the land market the reverse is true. Land buyers have a lot of listings to choose from. The Land market is a buyer’s market.

Days On Market

The average days on the market for the first half of 2025 was 426, down from 595 for the same time frame in 2024. As the chart below illustrates, DOM for land has varied from a low of 332 to a high of 605 over the past 12 years; the average is 441.  

How Land Purchases Were Financed

The commercial market has dried up.

During the first six months of 2025, there was only one closed commercial transaction; that is down four sales from 2024 for the same time period. In the full year 2024, there were eight commercial sales compared to six in 2023. After a boomlet in 2022—when there were 18 closed sales— the commercial market has come down to a more typical level for Taos. The chart below shows that 6-8 commercial transactions per year has been the norm in our small market. At this point, it looks as if 2025 will fall short of that norm. Higher interest rates have had a negative impact. Additionally, misgivings about the direction of the economy, and an ongoing shortage of labor, have made commercial investments less attractive.

The Taos retail sector was severely impacted by the road improvement project for the main commercial thoroughfare through town. This project dragged on for years, snarling traffic and discouraging shoppers. New higher parking fees in the Central Business District have added to merchants’ woes, although after push-back from businesses the Town rescinded them temporarily.

Nevertheless, there is some commercial development happening along the main corridor through town: two gas stations, a new tire store, and an expansion of the Town’s only car dealership, to name several.