Innovative Housing Solutions in Albuquerque and Santa Fe: Comparing Strategies to Address the Shortage

November 1, 2025

Santa Fe and Albuquerque, New Mexico, are each implementing distinct strategies to combat a deepening housing shortage, reflecting a nationwide struggle with affordability. These initiatives range from targeting high-end properties with new taxes to exploring cutting-edge construction methods.

Santa Fe’s “Mansion Tax” Initiative

Santa Fe is confronting the issue of escalating housing costs through a novel approach – a tax levied on high-value property sales. Officially known as a real estate excise tax, the measure aims to generate revenue for affordable housing programs by targeting those who can most afford to contribute.

According to New Mexico Representative Andrea Romero, the tax is designed to capture funds from affluent buyers acquiring luxury properties. “Many people want to live here and can afford to bring their money from elsewhere and buy up these very expensive properties,” romero stated. “We think, great, let’s attach a tax to it so that you can help others thrive here in looking for housing.”

The tax adds a 3% charge to homes sold for over $1 million, with revenue allocated to rental assistance, down payment support, and homelessness prevention efforts. This policy, approved by a important majority of voters, reflects a growing trend of cities seeking to leverage luxury real estate transactions to fund affordable housing solutions.

Realtor Opposition and Legal Challenges

Though,the policy has faced opposition from the Santa Fe Realtors Association,which contends that the tax is legally unsound. Beth Caldarello, president of the institution, expressed concerns about homeowner’s rights and the potential for legal ramifications. “The intent behind the tax is good, right? Affordable housing is very crucial,” Caldarello remarked. “That is not the issue. The issue is that we also protect homeowner’s rights. And when you have a tax that is unlawful, you know that’s where we have the problem.”

Despite these challenges, Representative Romero maintains that the tax has been legally validated. “Seventy-three percent of voters agreed that this was a tax on housing that they agreed with,” Romero asserted. “The appeals court just saeid that it was [lawful].”

Albuquerque’s 3D-Printed Casitas

In a different vein, albuquerque is embracing innovation with a program offering free, 3D-printable plans for “casitas” – small, independent homes. These structures, ranging in size from 450 to 750 square feet, are intended to increase housing density and provide options for multigenerational living.

University of New Mexico Law Professor Serge Martinez emphasizes that casitas should be viewed as one component of a broader strategy. “Casitas shouldn’t be seen as or relied on as a silver bullet that will bring affordability to a really tough housing market in Albuquerque,” Martinez explained. “If we think making it easier to build casitas is going to solve all the problems we see, we’ll absolutely be disappointed, but we should think of it as a step in the right direction, one that should be followed by many more.”

City	Approach	target	Funding Source
Santa Fe	“Mansion Tax”	High-end properties ($1M+)	Tax revenue from property sales
Albuquerque	3D-printable Casitas	increased housing density	N/A (plans are free)

Did You Know? The national median home price reached $431,000 in October 2023, according to the National association of Realtors, up 5.4% year-over-year.

Pro Tip: Explore local government websites for information on housing assistance programs and incentives in your area.

These contrasting approaches in New Mexico underscore the diverse strategies being explored to address the pervasive challenge of housing affordability. Both initiatives highlight the need for creative solutions to ensure access to safe and affordable homes for all residents.

What other innovative housing solutions should cities consider? Do you think “mansion taxes” are a fair way to fund affordable housing programs?

Understanding the Affordable Housing Crisis

The lack of affordable housing is a complex issue driven by factors like rising construction costs, limited land availability, and increasing demand. According to the U.S. Department of Housing and Urban Growth (HUD), over 12 million households are considered “housing cost-burdened,” spending more then 30% of their income on housing. This issue disproportionately affects low-income families, seniors, and people of color.

Addressing the crisis requires a multifaceted approach involving government policies, private sector investment, and community-based initiatives. Strategies like incentivizing density, streamlining permitting processes, and exploring choice building technologies are crucial for increasing the supply of affordable housing.

Frequently Asked Questions About Affordable Housing

• What is considered affordable housing? Affordable housing is generally defined as housing that costs no more than 30% of a household’s gross income.
• What are casitas? Casitas are small, detached homes frequently enough built in the backyard of a primary residence, providing additional housing units.
• Is a “mansion tax” a common practice? While not yet widespread,”mansion taxes” are gaining traction in cities facing severe housing affordability challenges.
• How can cities encourage affordable housing development? Cities can offer tax incentives,reduce regulatory barriers,and provide direct subsidies to developers.
• What role does 3D printing play in affordable housing? 3D printing offers a potentially faster and more cost-effective way to construct homes, reducing building costs.

Share your thoughts on these innovative housing initiatives in the comments below! And be sure to share this article with your network.

How do Albuquerque’s form-based zoning codes differ from customary land-use restrictions?

Albuquerque’s Approach: Density & Adaptive Reuse

Albuquerque, facing a growing demand for affordable housing, is increasingly focusing on strategies that maximize land use and repurpose existing structures. The city’s zoning regulations are undergoing revisions to encourage higher-density progress, especially along major transit corridors. This push for urban infill aims to reduce urban sprawl and provide more housing options within existing infrastructure.

* Form-Based Zoning: Albuquerque is piloting form-based codes in several neighborhoods. these codes prioritize the physical form of buildings – their height,placement,and relationship to the street – over traditional land-use restrictions. this allows for greater flexibility and encourages mixed-use developments.

* Accessory Dwelling Units (ADUs): The city has streamlined the permitting process for ADUs, often called “casitas,” making it easier for homeowners to add small, independent living spaces on their properties. This is a key component of missing middle housing strategies.

* adaptive Reuse Projects: Old commercial buildings and warehouses are being converted into residential units. A notable example is the renovation of the former albuquerque Public Schools management building into affordable apartments. This historic preservation coupled with housing development offers a unique solution.

* Community Land Trusts (CLTs): Albuquerque has seen growth in CLTs, which acquire land and maintain affordability in perpetuity. This model is particularly effective in preserving long-term affordability for low-income residents.

Santa Fe’s Focus: Innovative Building Techniques & Regulation Reform

Santa Fe, with its unique architectural character and stringent building codes, is tackling the housing shortage with a different set of tools. While density is also a consideration, the emphasis is on innovative construction methods and regulatory changes to lower building costs.

* Prefabricated & Modular Housing: Santa Fe is actively exploring the use of prefab homes and modular construction to accelerate building timelines and reduce construction costs. Several pilot projects are underway, demonstrating the feasibility of these methods in the region.

* Reduced Parking Requirements: Recognizing that parking mandates drive up housing costs, Santa Fe has begun to reduce or eliminate parking requirements in certain areas, particularly near public transit. This encourages more efficient land use and supports transit-oriented development.

* Tiny Home Villages: Santa Fe has cautiously embraced the concept of tiny home villages as a potential solution for individuals experiencing homelessness and those seeking affordable housing options. Zoning regulations are being adjusted to accommodate these communities.

* Streamlined Permitting: the city is working to streamline its permitting process, which has historically been a significant barrier to housing development.Online permitting systems and reduced review times are key priorities.

* Material Innovation: Utilizing locally sourced and sustainable building materials, like adobe and rammed earth, is a long-standing tradition in Santa Fe. Modern adaptations of these techniques, combined with new materials, are being explored to create affordable and environmentally pleasant housing.

comparing Strategies: A Side-by-Side Look

Feature	Albuquerque	Santa Fe
Primary Focus	Density & Adaptive Reuse	Innovative Building & Regulation Reform
Zoning Approach	Form-Based Zoning, ADU Expansion	Reduced Parking, Zoning for Tiny Homes
Construction Methods	Traditional, with some modular projects	Prefabricated/Modular, Sustainable Materials
Affordability Tools	CLTs, Historic Tax Credits	Streamlined Permitting, Material Cost Reduction
Key Challenges	Balancing density with neighborhood character	Maintaining architectural integrity while lowering costs

The Role of State & Federal Funding

Both Albuquerque and santa Fe are leveraging state and federal funding to support their housing initiatives.programs like the Low-Income housing Tax Credit (LIHTC) and the HOME Investment Partnerships program are crucial for financing affordable housing developments. New Mexico’s Housing Trust Fund also provides a significant source of funding for local projects. The recent Infrastructure Investment and Jobs Act offers potential funding opportunities for infrastructure improvements that support housing development, such as water and sewer upgrades.

Benefits of Innovative Housing Solutions

Implementing these innovative strategies offers numerous benefits:

* Increased Housing Supply: Addressing the core issue of housing scarcity.

* Improved Affordability: lowering housing costs for residents.

* Reduced Urban Sprawl: Promoting compact, walkable communities.

* Environmental Sustainability: Utilizing sustainable building practices and reducing transportation emissions.

* Economic Development: Creating jobs in the construction and related industries.

Practical Tips for Developers & Homeowners

* Developers: Explore opportunities for adaptive reuse and consider incorporating prefabricated or modular construction techniques. Engage with local community groups early in the planning process.

* Homeowners: Investigate the possibility of adding an ADU to your property. Consider participating in CLT programs to secure long-term affordability.

* Advocates: Support policies that promote density, streamline permitting, and incentivize affordable housing development.