Santa Fe is unaffordable, and most of our city’s population feels the strain. The 2022 median-priced home in our city was $608,700, which is considered unaffordable for 90% of Santa Fe City residents. This financial burden impacts essential members of the city’s workforce, preventing these working families from residing in the communities they contribute to and that Santa Fe relies on. Right now, the starting annual income of a Santa Fe teacher is around $50,000, a salary that puts owning a home in Santa Fe out of reach as prices exponentially increase. This homeownership crisis contributes to the widening racial wealth gap and climate change, while pricing out communities that make our city stronger.
What is Affordable Housing?
While we often think of affordable housing as subsidized rental units, homeownership is often more cost-effective than renting in the U.S. In two-thirds of American counties, the average monthly mortgage payment is less than average monthly rent. While affordable rental housing is essential, solely relying on rental strategies lacks foresight and doesn’t build wealth for the renter.
That’s why Homewise works with partners across the state to create affordable homeownership opportunities across New Mexico. But to do that, we rely on the generosity not just of private individuals, but of innovative funding mechanisms like the City of Santa Fe’s Affordable Housing Trust Fund, which has helped make more than 130 homes in the city considerable affordable to date (see “How is this Funded” below for more information).
One example of this in action is Casa Pacifica, a multi-unit affordable condominium complex. We took the former Airbnb rental property and converted the units into affordable housing that will be sold to households with incomes ranging from 50% to 120% of Santa Fe’s median income.
We priced these centrally located condos with various household sizes and incomes in mind (the larger the target household size for each unit, the higher the income limit). The pricing tiers include households with incomes of no more than 65%. 80%, 100%, and 120% of Santa Fe’s median income. Notably, one unit has no income limit, ensuring inclusivity and accessibility for all families seeking housing.
That means a teacher making $50,000 a year could afford our two-bedroom and two-bathroom unit priced at $209,750 – a steep decrease from the market value of $620,000. Or imagine a waiter who makes $32,800 annually, the average for a server in New Mexico (Bureau Labor Statistics, 2022). They could afford our one-bedroom, one bathroom condo at $141,250, which has a market value of $350,000. These two Santa Fe residents, who are currently priced out of the average home price in our city, would be able to have long-term, stable housing within their price range, contributing to our city for years to come.
How Is This Funded?
Affordable housing projects like Casa Pacifica are possible thanks to generosity of private donors, such as Sally Kuhn who contributed to this project, and from the net income of the market rate home (Unit #5).
But it’s also thanks to the City of Santa Fe’s Affordable Housing Trust Fund. This fund has played a vital role in supporting the construction and renovation of affordable housing units in our city.
The City Council recently approved a referendum that Santa Fe voters will have the chance to pass this November to make funding affordable housing possible for the long-term. This ballot measure would create a 3% excise tax on new home sales exceeding $1 million, but only on the increment above $1 million. For example, the buyer of a $1.5 million home would pay $15,000, which is 3% of $500,000. This would secure a consistent funding stream for the Affordable Housing Trust Fund, supporting affordable housing solutions for generations to come.
By creating a dependable funding source, the Affordable Housing Trust Fund can continue to provide crucial housing resources to the people of Santa Fe.
Residents can also get involved in community decision-making around affordable housing, like attending town halls, talking with neighbors, and sharing thoughts with community leaders. You can make your voice heard to create affordable housing, foster stronger neighborhoods, support local families, and improve our city.
Santa Fe may be unaffordable now, but with more funding for projects like Casa Pacifica, we can take steps toward building a Santa Fe for all.
For more information about Homewise and the services we offer, please visit: https://homewise.org/about-us/