First Quarter 2024

Taos Real Estate Market Report

January – March 2024 (3 months)

The market is mixed–some segments are down, some are up.

Through the first three months of 2024, sales of homes and land are down, but condos, multi-family and commercial are up. 2023 was a year of retrenching and stabilizing after the red-hot market of 2020-2022. 2023 sales were down vs. 2022 in all categories of property. Some slowdown was inevitable after two years of explosive growth fueled by ultra-low interest rates and the work-from-home shift caused by the Covid-19 pandemic. The market has cooled: buyers are not as plentiful, nor are they as zealously determined to buy as they were. Prices of homes and condos rose 20%-25% per year for two years, and they reached levels that are too high for some buyers today. Home loan interest rates have climbed from around 3% to slightly above 7%.

The outlook for the rest of 2024 is unclear. A number of factors are weighing on buyer psychology and buyer ability to invest in real estate. Expected cuts in interest rates by the Federal Reserve have not materialized; it now seems likely that the Fed will not lower rates much if at all this year. Although the Fed does not directly control mortgage rates—those are a function of bond yields in the market for long-term Treasury bonds— there is generally some correlation. At present, it looks as if mortgage rates are going to stay at around 7%. Inflation has persisted above the Fed’s target. And although many economists are predicting that the economy will actually have a “soft landing” in which inflation comes down without a recession, there is growing concern that government and consumer debt burdens will in fact cause a “hard landing” or at least some slowdown. Add to that a lot of angst about geopolitical tensions, escalating warfare in the Middle East, and ugly U.S. politics with elections looming in November, and you have the ingredients for another year of slower activity in real estate.

However– The inventory shortage of homes and condos that has plagued the market will continue; there is still more demand than supply, with no sign that they will get back to some sort of balance; therefore, prices should remain relatively buoyant. We believe that the long-term trend for Taos remains upward. This community will continue to draw people for whom the climate, natural beauty, lifestyle and culture here are attractive.

Click each title below to view the discussion and data for that property type.

Taos Real Estate Market Report

Home sales are tracking below last year’s pace.

For the first quarter January – March, unit sales were 49 this year vs. 59 last year, a decrease of 10 sales (-16.9%). Dollar sales were down 8.1%, from $30.2 million in 2023 to $27.7 million in 2024. The fall-off can be attributed to a change in buyer psychology. Buyers are fewer, and they are not as impulsive. The market sentiment has reverted to more normal behavior: these days, if a buyer doesn’t really like a house, he/she won’t buy it, whereas during 2020-2022, buyers were so determined to get a house here that they were not very picky.

Median and Average Prices

The median price (midpoint in the range of prices from low to high) for Q1 was $554,600 this year vs. $470,000 last year, a gain of 18.0%. The average (mean) was $555,700 vs. $511,300, an increase of $54,400 (10.6%). Although prices aren’t rising as rapidly as they were during 2020-2022, the lack of inventory of homes listed for sale has kept prices going up. Here is how median and average prices have changed since 2016:

Price2016201720182019202020212022 2023 2024 YTD
Median and average price trends since 2016

Since 2020, when the market surge started, median price has jumped 61%; the average has gained 42%. In addition to the overall price level rising, there has been an increase in sales of higher-priced homes. Just looking at the $1 million+ segment, the number of sales increased from 4 in 2019 to 34 in 2022 before coming down to 21 in 2023. The chart below showing sales by price segment illustrates the increases in sales of homes in the higher range.

Price Discounting

For the first three months this year, actual sales price averaged 7.1% below the last asking price when the home went under contract; the discount from original asking price was 12.7%.  These average discounts are much higher than what occurred during the market surge. In 2021 the discount from original price was only 4.5%; in 2022 it was 3.8%. Back then, multiple offers were common, and homes usually sold at full asking price–or higher. In 2023 and even in this year, some sellers listed homes as if the market were as hot as it was during 2020-2022. That hasn’t been working very well. We are seeing more reductions in asking price.

201320142015201620172018201920202021 2022 2023 2024
18.4%16.9%13.9%13.3%9.4%10.3%7.8%7.2%4.5% 3.8%8.4%12.7%
Discounts from original asking price 2013 – 2024 year-to-date
Days On Market

For 2024 Q1, the average days on market was 126, a 13.5% increase from 111 in 2023 for the same time period. Due to the steadily declining inventory of homes available for purchase, average DOM dropped dramatically from 2013 through 2022. Even so, the Taos average is much higher than in many parts of the country, where homes typically sell in 30-45 days. However, good homes in Taos in preferred neighborhoods are selling much faster than the average, which consists of a large diversity of types and locations of homes, some of which take much longer to sell.

201320142015201620172018201920202021 2022 2023 2024
DOM from 2013 through 2024 year-to-date
Apr 2024Apr 2023Sep 2008
Up to $200k 3 8190
$200k – $300k10 8109
$300k – $400k182469
$400k – $500k152739
$500k – $650k333035
$650k – $800k222227
$800k – $1mil231336
Over $1mil372713
Inventory by price segment
202020212022 2023 2024 YTD
$0 – $200k624426 16 4
$200k – $300k704947 21 2
$300k – $400k836472 45 7
$400k – $500k455562 49 8
$500k – $650k425366 37 13
$650k – $800k153443 26 5
$800k – $1mil152222 14 8
Over $1mil62933 15 2
TOTAL338350371 223 49
Unit sales by price segment

At the time this report was prepared, there were 161 homes listed for sale, up 12 (8.1%) from the start of the year, and up 2 (1.2%) from a year ago, when there were 159 homes for sale. The low point in 2023 was the 159 in April; the high point was 187 in July, which was not even a third of the number of available homes in September 2008, when there were 518 homes listed for sale! Taos inventory consists of a wide variety of size, price, style, location, and condition — everything from mobile homes to luxury homes. With only 150 – 190 listings on the market, it is difficult to find more than a few homes to show a buyer that might meet most of his/her criteria.

2013201420152016201720182019202020212022 2023 2024 YTD
Average inventory 2013 – 2024

There are no indications that inventory will increase substantially any time in the near future. Although there is some “spec” building going on, it’s nowhere near enough to satisfy the demand. Additionally, many current home owners are reluctant to list because they don’t want to give up ultra-low interest rates on their home loans. Therefore, the inventory will remain inadequate relative to demand. Unlike some markets in the U.S. where prices are actually falling (e.g., Austin, Texas) in Taos prices should continue rising, albeit at a slower rate than during the boom years

Home Purchase Financing
201120202021202220232024 YTD
Cash65 43%103 31%139 40% 132 36% 127 48%22 (45%)
Conventional loan66 44%200 59%180 52% 208 56% 112 42%25 (51%)
FHA loan8 5%11 3%14 4% 7 2% 8 3%0 ( 0%)
VA loan1 1%13 4%11 3% 13 4% 6 2%1 ( 2%)
Seller financing8 5%4 1%2 1% 8 2% 9 3%0 ( 0%)
Other2 1%6 2%3 1% 1 0% 2 1%1 ( 2%)
    Total150100%337 100%349 100% 369100% 264 100%49 (100%)
How Home Purchases Were Financed
Interest Rates

As soon as the Federal Reserve started its anti-inflation program of raising short-term interest rates in 2022, the rates on home loans increased dramatically. The average 30-year fixed rate loan rose steadily from around 3% in late 2021 to a peak of 7.76% in November 2023. Rates then trended down to a low of 6.6% in January 2024. Since then, they have climbed back up to a current average rate of 7.2%. There has been a lot of volatility in the market prices for US Treasury notes and bonds, which directly affects mortgage rates. Recent data on stubborn US inflation suggest that the Federal Reserve may not start lowering short-term rates until June at the earliest; and there may only be two cuts this year. Although mortgage rates are almost certainly never going to get back to the low levels of 2020-2021, if they were to stabilize around 6%, that should bring some buyers back into the market who have been on the sidelines; and it might also entice some homeowners who have been reluctant to give up their very low loan rate to list and sell their home.

Conventional 30-year fixed 7.17% 
Conventional 15-year fixed6.44%
Average rates as of Jan. 18, 2024 from Freddie Mac

Note: Interest rates are impacted by occupancy, credit score, and down payment.
Foreclosure Sales
20122013201420152016201720182019202020212022 2023 2024
5550493434292517950 4 2
28%21%22%13%14%10%9%6%3%1%0% 1% 4%
Foreclosure Sales: Number and % of total Single-Family Homes sales 2012 – 2024 year-to-date

Through the first three months of 2024, there have been 2 foreclosure sales. In the full year 2023 there were 4; in 2022 there were none. The number of foreclosures diminished steadily from a peak of 55 in 2012 during the aftermath of the Great Financial Crisis of 2008-2009. Currently, there is just one bank-owned house listed for sale. The one listed at $3.5 million in our last market report did not sell and has been withdrawn.

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 off to a strong start

Condo sales last year in 2023 were down sharply compared to 2022 (58 vs 92 units sold). In the first quarter this year, the trend is reversing: unit sales are up from 6 in 2023 to 10 in 2024, a gain of 66.7%. Dollar sales are up from $3.1 million to $4.6 million (48.5%). The inventory of condos listed for sale is extremely limited, which has been a limiting factor on the number of sales. As is the case with homes, there are no signs that inventory will increase significantly any time soon.

Median price for Q1 was $323,500 this year vs. $517,600 last year, a decrease of $193,500 (-37.4%).  Average price was $458,400 vs. $514,500, a drop of $56,100 (-10.9%).  The big decreases are due to the fact that last year’s 6 sales included three at Taos Ski Valley (where prices are much higher), whereas this year’s 10 sales included only one at TSV. As this year progresses, the proportion of sales at TSV should diminish, and therefore we should expect to see 2024 averages more in line with 2023—or higher.

Price Discounting

For the first quarter this year, final sales price averaged 1.1% less than the last asking price when the condo went under contract, and 1.8% below original listed price. These discounts are much less than those for single-family homes, reflecting an even tighter inventory for condos than for homes.

20142015201620172018201920202021 2022 2023 2024
12.7%8.6%11.8%6.7%6.5%5.5%3.2%3.3% 2.1% 6.6%1.8%
Discounts from original asking price 2014 – 2024 year-to-date

Days On Market – For the quarter, DOM averaged 105 in 2024 vs. 153 in 2023, a decrease of 48 days (-31.4%). Again, last year had 50% of the sales at Taos Ski Valley, where it generally takes somewhat longer to sell.

201320142015201620172018201920202021 2022 2023 2024
559237324259195125178111152122 109105
DOM from 2013 through 2024 year-to-date

The number of condos listed for sale at the time of this report was a scant 23, down from from 31 two months ago, down from 26 at the beginning of the year, although up from 17 at this time a year ago.

In 2006, when condo development was at its peak, there were often around 200 condos on the market at any given time, with the majority in or near central Taos. There were 149 condos sold that year.

20132014201520162017201820192020202120222023 2024
1078178655859564948 39 2326
Steady average inventory decrease 2013 – 2024 year-to-date
CurrentYear AgoSept 2008
Up to $150k 0 040
$150k – $250k 1 050
$250k – $350k6151
$350k – $500k5956
Over $500k11 729
Inventory by price segment
20202021 2022 2023 2024
Up to $150k108 1 0 0
$150k – $250k2116 13 8 1
$250k – $350k1830 33 14 5
$350k – $500k2222 31 15 2
Over $500k36 14 21 2
     TOTAL7482 92 58 10
Unit sales by price segment
How Financed2016202020212022 20232024
Cash34 51%43 58%36 44% 45 49% 3866% 6 60%
Conventional loan32 48%30 41%45 55% 47 51% 2034% 4 40%
Seller financing1 1%1 1%0 0% 0 0% 0 0% 0 0%
Other0 0%0 0%1 1% 0 0% 0 0% 0 0%
    Total67100%74 100%82100% 92100% 58100%10100%
How Condo Purchases Were Financed
Foreclosure Sales

There have been were no foreclosure sales through the first three months in 2024. There were none in 2023, 2022 and 2021.

Multi-family sales starting to gain!

We are only three months into the year, and already there have been 7 sales vs. none in the first quarter of last year. For the full year 2022, there were only 6 multi-family sales; in 2021 there were 5. In peak year 2005, when the overall real estate market was strong before the Great Financial Crisis, there were only 8 sales. Multi-family has always been a very small segment of the Taos real estate market.

This year’s fast start is surprising, especially in the current environment of much higher interest rates. Higher interest rates mean that investors should be demanding higher capitalization rates, which reduce the value of the income stream of a property. Although rents have been trending higher for years—due to an acute lack of inventory of long-term rental properties— rent increases appear to be moderating. The sale of seven investment properties in only three months is indeed unexpected!

Currently, there are 11 multi-family properties listed for sale; only one has a sale pending. So it remains to be seen if the early momentum continues.

The Land market is down vs. last year, but not by a lot.

Through the first quarter, unit sales are down by 5 tracts (47 tracts sold this year vs. 52 last year), a drop of 9.6%. Dollar sales are actually up slightly at $5.157 million vs. $5.149 million (+0.1%).

In the full year 2023, 207 tracts sold compared to 258 in 2022, a decrease of 51 units (-19.8%). Dollar sales were down 21.3%, from $31.6 million to $24.9 million.

So far this year, median price is down 6.2%, but average price is up 10.8%.

The primary constraints on land sales are very high building costs and the long lead time to start and complete construction of a home. Good builders are quoting $400 per square foot (or more) for the hard dollars of construction; this doesn’t include the land purchase, possible well drilling, septic system installation, landscaping. It generally costs more to build a new home than to buy an existing home. However, this is not a deterrent for some people: good builders are booked up for at least two years!

Land sales were very strong in 2021 after languishing for years 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.

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 peak level of 2005.

Median price for the 2024 Q1 was $68,000, a drop of $7,600 (-6.2%) from 2023 Q1. For the full year 2023, the median was $72,000; in 2022 it was $75,600. You can see that the median is fairly stable.Average (mean) price was down $2,300 (-1.9%), from $122,500 to $120,200. 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. In other words, the Land market is more of a buyer’s market.

Price2016201720182019202020212022 2023 2024
Median and average price trends 2016 through 2024 year-to-date

Current inventory of 350 tracts listed for sale is down 3 from the start of the year, and down 31 from a year ago. Note the huge decrease in the number of lots listed up to $50,000.

Current MonthSame Month last year
Up to $50k2776
$50k – $100k 112115
$100k – $150k4953
$150k – $200k53 45
$200k – $250k2422
$250k – $300k12 13
Over $300k7357
Comparative inventory by price segment
201720202021 2022 2023 2024 YTD
465386 715316
345784 978616
161726 31 24 4
151623 18 14 4
3414 12 8 1
207 6 12 2
2412 23 13 4
118147252 258 210 47
Yearly unit sales by price segment
Price Discounting

For the first quarter of 2024, actual sales price averaged 5.6% less than the last listing price; the discount from original listing price was 9.5%. For the full year 2023, the discounts were 8.8% and 12.9%, respectively.

Days On Market

The average days on the market for the first quarter of 2024 was 670 vs. 346 for the same quarter in 2023. This year’s DOM was skewed by three sales in the Servilleta Subdivision out in Tres Piedras: those three sales had an average DOM of 7,170 days each! As the chart below illustrates, DOM for land has been up and down over the years.  

2013 2014 2015 2016 2017 2018 2019 2020 2021 20222023
465 390 605 464 472 388 332 471 351 437 421
Average Days On Market 2013 – 2023
How Land Purchases Were Financed
202220222023202320242024 YTD
# of sales% of total# of sales% of total# of sales% of total
Cash 188 75%168 80%37 79%
Conventional loan 35 14% 24 12% 7 15%
Seller financing 28 11% 18 8% 2 4%
Other 1 0% 0 0% 1 2%
    Total 252100%210100%47100%
Land Purchase Financing

The commercial market is up so far this year.

For 2024 Q1, there have been two commercial sales compared to none during the same time period in 2023. Last year was a very weak year, after a robust 2022: 2023 had just 6 sales compared to 18 in 2022, a drop of 12 sales (-66.7%). Total dollar sales were down 82.3%, from $14.5 million to $2.6 million. Six of 2022’s sales were $1 million or more.

Higher interest rates no doubt are affecting the feasibility of some commercial opportunities. Currently, there are 30 active commercial listings, with just one pending sale.

With the growing number of people moving to Taos (for either full-time or extended-stay living), the demand for commercial services — and therefore for commercial real estate — should increase over time. However, given higher interest rates and the possibility that there might yet be a recession, 2024 may be another quiet year in this sector of the market. As the chart below indicates, since 2011 there have only been a few years with more than ten commercial sales.

2011201220132014201520162017201820192020 20212022 2023
2793177514 12 8618 6
Commercial Sales 2011 – 2023