After a long winter of cold, snow, and gray days it’s refreshing that spring has finally settled in. After several false starts, fruit trees and flowering shrubs have blossomed, mountain snow is melting away, and jackets are shed once the sun comes out.

While nationally there are cautious signs of an economic spring emerging, the Santa Fe’s real estate market is still somewhat frozen. Inventory levels are about even with 3rd quarter ’08 while average days on the market have risen from 164 to 185 days and absorption rates have inched higher. Given the economic climate, residential sales, however, fell 35% this quarter as compared with 1st quarter ’08.

Other noticeable changes since 1st quarter ’08 include a widening of the spread between asking and sales prices and a dropping of the average price/sqft. Of course, the statistics of each specific neighborhood may vary from the average somewhat but here is a snapshot of two popular areas to give a flavor of what has been transpiring:

We recently began tracking a new parameter that provides perspective on sales momentum by following the number of listings taken vs listings sold within the time period. It is sobering from a seller’s view point as only 27.20% of listings taken in the quarter have sold. It speaks for the need for sellers to price their properties very attractively relative to competing inventory as well as making their home’s aesthetics shine. (It is important to note that historically sales are slower in the 1st quarter relative to later quarters and subsequently this parameter should improve as the year progresses).

Continuing the trend of previous quarters, land sales continue to suffer far more than the residential market. Inventory remains high at 1020 parcels with only 25 sales year to date.

Everyday we are exposed to a wide variety of opinions as to where real estate markets are headed in 2009:

Home Price Outlook Clouded by Disagreement

• Source: The Wall Street Journal (4/24/09)

Housing Analysts Predict the Bottom Is Near

• Source: The Wall Street Journal, June Fletcher (04/24/2009)

National Housing Picture Tough to Determine

• Source: The Wall Street Journal, Dawn Wotapka (04/23/2009)

While Santa Fe has weathered the storm fairly well overall, its clear that our market now offers the most attractive buying opportunities seen in years. If the current government stimulus plan results in high inflation a year or two out, real estate, especially if financed at historically low interest rates, could prove to be a positive hedge. In the interim, we will be tracking the market and continue to keep you informed each quarter on where things are going.

As always, please don’t hesitate to contact us should you like to discuss the market and/or how it might specifically affect your property or any potential buying decisions.