Housing authority outlines changes to affordable-home pricing and developer incentives

At the June 30 meeting, Santa Fe County housing staff and commissioners discussed how recent changes in Area Median Income (AMI) calculations and mortgage rates are reshaping the county’s affordable-home pricing and program responses.

Denise (affordable housing staff) explained that the FY2027 maximum target pricing matrix — which the board approved — relies on HUD data and average mortgage interest rates used in the prior year’s calculations. "If the market rate goes down, the affordable home price goes up; if it goes up, then the affordable home price goes down," Denise said, describing how interest-rate shifts influence what clients pay on their first mortgage and therefore the affordable-sale price developers can charge.

Staff told the board that Housing New Mexico’s change to allow affordable eligibility up to 150% of AMI complicated the market this year, pushing some affordable prices higher. Commissioners and staff discussed a set of program and code responses: introducing a county down-payment assistance program (to be brought to the Board of County Commissioners for approval), soft-second mortgages for certain buyers, enabling developers to buy down mortgage rates, adjusting origination-fee policies and pursuing code changes to allow more one- and two-bedroom units on smaller lots.

Commissioner Bamonte and others raised options to use existing housing stock and mobile homes as affordable supply; staff said they are evaluating grants from Housing New Mexico to purchase, refurbish and sell dilapidated properties as affordable units. Staff also reported meeting with public works to identify small county-owned parcels suitable for infill workforce housing and said they will pursue an infill ordinance to enable smaller-lot development.

Clifford Burke (affordable housing administrator) briefed the board on development-assistance NOFO responses and said award recommendations will be presented at the board’s first July meeting. Staff said finalized affordable housing agreements for UNO Moss LLC and LVIDA Estates are in place and that they will refine an interactive application map to display pipeline units by district.

What’s next: staff will distribute the approved MAX pricing matrix to mortgage partners and developers, present a down-payment assistance proposal to the Board of County Commissioners, and continue code and program work to encourage one- and two-bedroom units to better match demonstrated local demand.