Life, food, events, and community in Albuquerque, NM

Albuquerque among good cities for first-time homebuyers

Something sort of reassuring in today's news: While we're not mentioned by name in the New York Times article about why it might be a good time to buy your first home, we are included by association. The article leans on a study, released in October, that lists Albuquerque as a place where home values (placed within the context of renting vs owning) are expected to appreciate between now and 2012.

Home owners in "bubble" cities (including, BTW, regional competitors Denver, Colorado Springs, Boise, and Salt Lake City) should expect a further decline in home values in the next four years, according to the study released by the Center for Economic Policy and Research and the National Low Income Housing Coalition.

According to the Times, "One study... tries to predict where today’s first-time buyers in the 100 biggest metropolitan areas may actually have less home equity by 2012 as a result of continued price declines. The verdict was that buyers in 33 of the markets could see a decline by 2012, including potential six-figure drops on an average home in the New York City, Los Angeles, San Francisco and Seattle metropolitan areas."

But, as New York Times journalist Ron Lieber points out, with prices in a slump and the federal government working to depress interest rates, this is probably a really good time to buy -- provided you don't also have to sell your old house and that you're living in one of the cities that can expect an increase in values. Decent credit helps too.

And while Albuquerque homeowners can anticipate modest positive gains compared to buyers in Dallas, TX, or Rochester, NY, the gains are still there. Whew.

New York Times: Maybe It’s Time to Buy That First House
CEPR & NLIHC: The Changing Prospects for Building Home Equity

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Comment by KG on December 7, 2008 at 12:24pm: Well that's a relief. I just bought.

Comment by Robert S. on December 8, 2008 at 1:26am: i'm getting lukewarm to house buying, I'm just holding out for the Albuquerque housing to bottom (a few more fake-development employers go belly up or move operations to greener pastures elsewhere and then we should match what the rest of the nation has for a housing market.).

Comment by Doug R on December 8, 2008 at 2:35pm: (on second thought, thought I would post something a bit different).

I've been predicting a mass exodus out of California for a few years now. Yes, I still get sneers and people laughing at the idea both in NM and California. But it's going to be a reality folks. Now, I do think many of my fellow Californians will pour through NM on I-40 on their way to other destinations. But some will stay and we're going to see an influx over the next 5 years.

It's simple, even during the good times (2005-2006) those getting into houses in the Bay Area were still stretched thin. Yeah sure they got an interest only loan but they still couldn't afford to save for their 401k's and other things. They were strapped even then.

Now we have tons of layoffs, a tech field that is going to see tons of mergers and acquisitions over the next few years and salaries declining. What is going to be so golden about the golden state? I'm seeing it today in the amount of people asking my wife and I about our move. It's on the minds of 38 million people out here. And it appears that the supply of workers for the amount of jobs could be way out of balance for years to come.

The question becomes will NM employers snap up ex-Californians for their expertise, skills, etc?

Comment by Doug R on December 8, 2008 at 2:55pm: A scoreboard for what is going on only 1100 miles west of Albuquerque. When I used to surf, my buddies and I used to go online and check out the data from one of our off shore buoys out here to see if the weekend was going to be good. I think this site is an off shore buoy for Albuquerque and the rest of the states east in terms of predicting alot of things like housing, jobs, etc. You may disagree but......

Comment by Brendan on December 8, 2008 at 2:56pm: Doug- The number of folks in California who will take the NM-Salary Buzzcut is going to be pretty low. Few people can see past the money they were making, even when their current income is $0.00. NM employers may be able to snatch up a few people, but will they be real talent or the less skilled persons who just happened to work for otherwise good companies?

Comment by Doug R on December 8, 2008 at 3:23pm: Brendan...this new crisis has helped people understand the difference between "economic buying power" and their salaries. For example, I can almost take a 50% pay cut in Albuquerque and maintain the same buying power that I have in California at this time. And the expectation levels of California employers (at least in tech) have been at "no life" levels for years. There is alot of burn out. The mantra was "so you work very hard and long but you get rich." Now you're just lucky to have a job? I'm telling you that people aren't going to stick around for those kinds of working conditions at the upcoming reduced pay. My wife and I are constantly hearing people bash the hectic lifestyle out here and how they wish they could leave. It think the charm of the state is diminishing quickly each week. And it won't be temporary.

This change that I predict is a complete change in image for California. Since the 1800's it has been the destination for all sorts of reasons. At 38 million people, another bad crisis only 5 years after the end of the last one and this HUGE decline in real estate values.........the party is over. But, we'll see. Don't confuse those who refuse to believe with those forced to believe. Out of a job, upside down in your house, credit cards at your limit (all four of my co-workers and more).......you'll be forced to do something.

Like I said in my original post, what may save NM is that we're still in between AZ and Texas in most Californians minds. 8 out of 10 may just drive through on their way to somewhere else back east.

Brendan - I look forward to meeting you once I'm in town. You're going to find with me that I do alot more research than the average Joe out there in the job market. It's a very bad sales habit I've picked up after 17 years of trying to close business in all types of economic climates and companies. I evaluate things differently than most folks. And so far it's paid off. Hey, my last gamble was to move to Software as a Service companies back in late 2005. Wasn't too popular with my traditional enterprise software friends. My two best years of earnings were in 2006 and 07. I jumped from hardware to software when it wasn't cool back in 2000. I take calculated risk and that takes research and looking at things differently, talking to people, etc.

For me...maybe not for others.....but for me New Mexico holds more promise over the next 20 years than the Silicon Valley. There are more people like me than you think out in NM - I've met several on my previous trips out.

Comment by Robert S. on December 9, 2008 at 2:11am: to me, fake development is all these companies moving call centers or factories or whatever to Albuquerque or New Mexico because of the tax breaks and incentives, not because those companies like the quality of life, the workforce quality, or other issues that make you want to be here and plant roots in the state.

When the companies go belly up, the tax incentives run out or other areas offer incentives (I hear Michigan is trying to offer better incentives than NM for the entertainment business), those companies lay off people, close factories/call centers, and if they are still in business they go to their greener pastures. Companies who care about NM will find ways to stay in the state unless something like higher than normal tax rates or tougher regulations make it so the company has no choice but to leave NM for more business-friendly states.

Comment by FOXP2 on December 9, 2008 at 8:44am: Doug R-
"For me...maybe not for others.....but for me New Mexico holds more promise over the next 20 years than the Silicon Valley. There are more people like me than you think out in NM - I've met several on my previous trips out."

Nice talk. Hope it works out.

I was thinking the same things back in 2003 when I took a 50% cut in pay to move from a high quality of life, high wage position in Minnesota to the Land of Disenchantment. Nice climate, arty, unque quality of life, all the faux intangibles that emigrants to the Land of Undermployment use to rationalize their move.

No single decision I have made has cost me as much in economic, professional, and eventually, personal costs.

Now I am stuck with an unsalable house in Sandi Heights and a brutal work schedule. I am still scrapping along at a 50% pay reduction, all while enjoying the corruption and patronage that is endemic to New Mexico.

When my friends ask me about moving to New Mexico, I tell them to bring their own money. They won't find any here.

FEIGHTNER
Would set a brick on the Chinaman button to get back to the Midwest.
Anybody want to buy a house?

Comment by Masshole in Fringecrest on December 9, 2008 at 9:34am: @FOXP2- how long has your house been on the market?

Comment by Masshole in Fringecrest on December 9, 2008 at 9:37am: Also- what's the origin of the phrase "set a brick on the Chinaman button"? Just curious.

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