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THE MARKET FOR AFFORDABLE HOUSING IN TAOS

This study analyzes the housing market in Taos, identifying causes of crisis and proposing solutions. Recommendations include economic development for higher paying jobs, land supply increase, and infrastructure extension.

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THE MARKET FOR AFFORDABLE HOUSING IN TAOS

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  1. THE MARKET FOR AFFORDABLE HOUSING IN TAOS Funded by: Town of Taos University of New Mexico – Taos Jeffrey Mitchell, Ph.D. July 12, 2011 Bureau of Business & Economic Research

  2. Housing Costs • The majority of those in the workforce are unable to afford market-priced housing in Taos County. • About 12% of households could afford the median price of a market home (about $300 thousand). • Only about 5% of households employed in Taos County could afford the median price of a market home. UNM Bureau of Business & Economic Research

  3. Capacity to Pay vs. Cost of Housing Gap between two lines represents shortage of affordable housing. UNM Bureau of Business & Economic Research

  4. Causes of Housing Crisis • Two underlying causes: • Demand for housing by seasonal residents drive up property (esp. land) values. • Supply of land is constrained by state regulations and limited development of services (water & sewer). • Slowdown in the market is NOT a cause. UNM Bureau of Business & Economic Research

  5. Household Responses to Housing Crisis • Households respond to high cost of housing in three ways. • Publicly subsidized housing • Substandard housing (esp. trailers) • Subdivision of family land • These strategies are not sustainable. • Without effective, intervention high cost of housing will limit labor supply and long term economic growth. UNM Bureau of Business & Economic Research

  6. Future demand for affordable housing • Optimistic scenario – growth of middle income employment base (professional & business, healthcare and education services) • Est. demand for 250 low-income units (monthly costs <$850) by 2018 and strong demand of affordable owner-occupied units ($160k-$200k). • Pessimistic scenario – continued growth of low income employment in hospitality & construction. • Estimated demand for 1,500 low income units by 2018. UNM Bureau of Business & Economic Research

  7. Recommendations • Economic development that emphasizes higher paying jobs, increasing the capacity of workforce to affordable available housing. • Increase the supply of land available for residential development. • Extend water & sewer infrastructure. • Encourage higher density residential development on serviced land. • Town & County collaboration. UNM Bureau of Business & Economic Research

  8. THE MARKET FOR AFFORDABLE HOUSING IN TAOS Funded by: University of New Mexico – Taos Town of Taos Jeffrey Mitchell, Ph.D. July 12, 2011 Bureau of Business & Economic Research

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