Taos Real Estate Market Report
January – November 2022 (11 months)
The market has returned to more normal (pre-pandemic) conditions.
Through eleven months in 2022, the number of sales of Single-Family Homes is up 26 (8%) compared to 2021 for the same time period. Condo sales are up by 19 units (26%). Land is down by 1 sale (-.4%). Commercial sales are up hugely (17 this year vs. 4 last year). The market continues to cool from the semi-crazy conditions experienced from mid-2020 through the first half of 2022. There is still strong buyer interest in Taos, but higher interest rates, persistent inflation, the stock market decline, and fear of a recession are causing buyers to be a bit more cautious. The Taos market is not affected as much by these factors as are many other markets., but the buying frenzy of 2020-2021 has abated. And given the chronic shortage of homes and condos listed for sale here, a true market decline with falling prices is unlikely.
Click each title below to view the data for that property type.
2020 – 2021 saw a spurt in buying in the aftermath of the Covid pandemic. All over the country, there was a rush to work from home, with many persons looking to get out of crowded urban areas and into homes with more space. Additionally, historically low interest rates (3% and lower) further stoked home-buying. Like many other markets, Taos experienced something of a buying stampede, with homes selling much faster than had been typical for our market–sometimes in a day or two. There were numerous cases of multiple offers, “bidding wars”, and homes selling well above asking price. Prices rose at a rapid rate – over 20% per year in some cases. This kind of market behavior had been very uncommon in Taos – even during the boom years of the early 2000s.
In the first half of 2022, the market remained hot; but in the latter half of the year, the market started to cool. We are not seeing as many cases of multiple offers written as soon as a new listing comes on the market; bidding wars have subsided some. The market has become sort of split, with better homes in preferred neighborhoods still selling relatively fast and at full price, whereas less desirable homes are getting fewer showings, and are taking longer to sell. Total dollar sales are up, as prices continued to rise earlier in the year; however, prices now seem to be leveling off.
Through eleven months, unit sales are 347 this year vs. 321 last year, an increase of 26 sales (8.1%). Earlier this year, sales were only slightly above 2021’s pace; in the last few months, the gain in sales has accelerated. This is probably due to the fact that our title companies are closing escrows faster than they were last year. A new title company opened for business on August 28, and this has definitely speeded up escrows. Last year it was taking 4-5 months to close sales. Now the number of sales contracts languishing in escrow has diminished significantly: currently there are 26 pending sales, whereas earlier this year the number was in the 70’s. Additionally, with mortgage interest rates so much higher than they were a year ago, the number of persons re-financing is way down, which also reduces the workload at the title companies. Title insurance commitments are coming out much faster than they were!
Dollar sales year-to-date are up $30.0 million (+18.4%), from $163.0 million last year to $193.0 million this year. The first half of the year saw big increases in prices; going forward, the percentage gains in dollar sales may be more in line with the increases in unit sales.
Median and Average Prices
Through eleven months of 2022, the median price (midpoint in the range of prices from low to high) is $465,000 vs. $425,000 in 2021, an increase of $40,000 (+9.4%). The average (mean) is $556,100 vs $507,700 last year, a gain of $48,400 (+9.5%). Here is how median and average prices have changed over the past seven years:
For the year to November 30, actual sales price has averaged 2.0% below the last asking price when the home went under contract; the discount from original asking price is 3.7%. The trend of demand exceeding supply has caused the discount from original price to decrease steadily starting in 2013:
Days On Market
The average days on the market so far this year is 113 vs. 140 in 2021, a decrease of 27 days (-19%). Days on market averaged 250 during 2003 – 2016; since 2016, there has been a steady decrease, as the inventory of homes decreased but buyer demand increased. We may see this number start to climb some as the market cools.
|Dec 2022||Dec 2021||Sep 2008|
|Up to $200k||13||19||190|
|$200k – $300k||15||37||109|
|$300k – $400k||30||46||69|
|$400k – $500k||32||34||39|
|$500k – $650k||33||29||35|
|$650k – $800k||24||29||27|
|$800k – $1mil||22||15||36|
|Up to $200k||58||61||44||22|
|$200k – $300k||64||70||49||46|
|$300k – $400k||74||83||64||68|
|$400k – $500k||27||45||55||58|
|$500k – $650k||24||42||53||61|
|$650k – $800k||16||15||34||41|
|$800k – $1mil||4||15||21||22|
At the time this report was prepared, there were 196 homes listed for sale, down 17 (-8%) from 213 last month, and down 47 (-19%) from a year ago, when there were 243. The low point this year was 194 in April. The high point was 254 in August. In September 2008, there were 518 homes listed for sale. The average inventory decreased every year from 2013 to 2018; it went up in 2019, but decreased again in 2020 and 2021, and it is decreasing again this year. Taos inventory consists of a wide variety of size, price, style, location, and condition – everything from mobile to million-dollar homes. With only 252 listings (many of which are under contract), it is difficult to find more than a few homes to show a buyer that might meet most of his/her criteria.
With demand still strong — and with no significant increase in the building of new homes or the listing of existing homes expected — the inventory will remain inadequate relative to demand for the foreseeable future. This should keep prices fairly buoyant.
Home Purchase Financing
Since the Federal Reserve started its anti-inflation program of raising short-term interest rates earlier this year, the rates on home loans increased dramatically from the extremely low rates of 2020-2021: The 30-year fixed-rate loan is now averaging 6.5%, up almost 4 points from the lows in 2021 . However, there was a time not that long ago when mortgage rates of 6-7% were normal.
|Conventional 30-year fixed||6.47%|
|Conventional 15-year fixed||5.83%|
Note: Interest rates are impacted by occupancy, credit score, and down payment.
For the year through November, there have been no foreclosure sales. For the full year of 2021, there were just two foreclosure sales (2% of total sales). The number of foreclosures has diminished steadily over the past several years. Currently, there are just two bank-owned houses listed for sale.
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.
Year-to-date unit sales are 91 vs. 73 for the same time period in 2021, a gain of 18 units (25%). Dollar sales are up 52%. This is despite the fact that the condo inventory is even more limited than that for single-family homes. As with homes, there are no signs that inventory will increase significantly any time soon; therefore, prices should continue to increase; but, as with homes, the rate of price increase will be slower than during the post-pandemic surge.
Median price through the first eleven months is $350,000 vs. $315,000 last year, an increase of $35,000 (11.1%). Average price is also up, at $394,300 vs. $323,400, a gain of $70,900 (21.9%).
Year-to-date final sales price has averaged 2.0% less than the last asking price when the condo went under contract; sales have averaged 1.9% below original price.
Days On Market through 11 months is 122 vs. 161 for the same time frame in 2021, a decrease of 39 days (-24%)
The number of condos listed for sale at the time of this report is down to just 20, a decrease of 3 from a month ago, and down 44 (-69%) from 64 listings at this time a year ago. There are only five condos available that are priced under $400,000; there are seven between $400-$500K.
In 2006, there were often over 200 condos on the market at any given time, with the majority in or near central Taos; there were 149 condo sales that year.
|Dec 2022||Dec 2021||Sept 2008|
|Up to $150k||0||3||40|
|$150k – $250k||1||10||50|
|$250k – $350k||2||19||51|
|$350k – $500k||10||16||56|
|Up to $150k||16||10||8||1|
|$150k – $250k||8||21||16||13|
|$250k – $350k||3||18||30||33|
|$350k – $500k||1||22||22||31|
There have been no foreclosure sales so far in 2022. There were none in the full year 2021.
There have been 6 multi-family sales through the first eleven months of 2022, one fewer than in 2021 for the same time period.
Multi-family is and has always been a very small segment of the Taos real estate market. In peak year 2005, there were only 8 sales.
Rents have been trending higher for years, so multi-family income properties should yield fairly attractive returns on investment. However, with interest rates rising (i.e., cost of capital), buyers may start to require higher “capitalization rates.” Higher cap rates mean buyers would pay less for a given income stream (net operating income).
Currently, there are 8 multi-family listings. One of these is a motel that has been closed for years. It is suitable for conversion to rentals, and it has a sale pending.
Land sales have slowed from last year’s rapid pace.
Land sales really took off in 2021 after being in the doldrums ever since the recession that followed 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. Some home buyers were frustrated in their search for an existing home given the low inventory and intense competition, so they decided to buy land and build.
So far in 2022, there have been 235 closed sales, a decrease of 1 (0.4%) from 236 last year for the same time period. Dollar sales are up 15.9%, at $29.7 million this year vs. $25.6 million last year, an increase of $4.1 million.
Median price year-to-date is $78,600 vs. $70,800, an increase of $7,800 (11.0%). Average price is up $17,800 (16.4%), from $108,500 last year to $126,300 this year. Given that the supply of homes and condos listed for sale is not expected to increase much, interest in land should continue to grow, especially if building costs stabilize or come down some; therefore, prices should trend upward—but only gradually. Whereas in the market for homes and condos there is much more demand than supply, in the land market the reverse is true.
Current inventory of 415 tracts listed for sale is down 350 (7%) from 445 a year ago.
|Current Month||Same Month last year|
|Up to $50k||90||115|
|$50k – $100k||131||146|
|$100k – $150k||57||61|
|$150k – $200k||47||41|
|$200k – $250k||26||26|
|$250k – $300k||12||16|
For the year to date, actual sales price has averaged 8.3% below the last asking price when the home went under contract; the discount from original asking price is 11.7%.
Days On Market
The average days on the market so far this year is 453 vs. 358 in 2021 for the same time frame, an increase of 95 days (27%).
|2013||2014||2015||2016||2017||2018||2019||2020||2021 2022 YTD|
How Land Purchases Were Financed
The commercial market has seen a surge in activity in 2022!
So far this year, there have been 17 sales with a total dollar volume of $14.5 million. Six of these sales were $1 million or more: The Hacienda del Sol B&B sold for $2.9 million; the old San Geronimo Lodge changed hands again at a price of $2.4 million; a retail complex near the Plaza sold for $1,035,000; the old El Taoseno Restaurant sold for $1.6 million and has been converted to the new Taos Lifestyle store; a self-storage business sold for $1.25 million; and the Yucca Plaza retail complex just north of Taos Plaza sold for $1 million.
For the entire year 2021, there were only 6 sales, with a total dollar volume of $1.9 million. The lingering impacts of the Covid pandemic continued to affect the commercial sector in 2021. Confidence has improved in 2022. Additionally, the legalization of cannabis has added demand for retail space for cannabis dispensaries; probably five of this year’s sales were for this. With the growing number of people moving to Taos (for either full-time or extended stay living), the demand for commercial services — and therefore commercial real estate — should continue to increase.