Any contractor who has priced an apartment job lately knows the numbers are tough. Now the state has put a figure on just how tough.
Leaders of the New Mexico Office of Housing released a new analysis Wednesday, Oct. 14, showing how the state's housing supply shortchanges most low- and moderate-income residents. According to Source NM, they also laid out a plan to ask for roughly $97 million in the upcoming legislative session.
The Office of Housing has been attached to the New Mexico Department of Workforce Solutions since 2025. In that time, lawmakers have already given it more than $100 million for housing and homelessness programs.
The $73,000 gap
The number that matters most to builders came from Lisa Huval, the office's housing initiatives manager. She said building a single apartment in a multifamily development in Albuquerque now costs a developer about $348,000. That number has kept climbing because of rising construction, regulatory and capital costs.
For that apartment to be affordable to a renter earning 80% or less of the city's median income, it would need to cost about $275,000, Huval said.
"That difference between those two numbers is really what is driving our housing shortage," she said.
That's a gap of about $73,000 per unit. Multiply that by a 100-unit building, and it's easy to see why so many affordable projects can't get off the ground without help.
The 'mismatch'
The analysis also found that a lot of the state's lower-cost housing isn't going to the people who need it most. Overall, 65% of affordable housing across the state is owned by people who could afford something more expensive, officials said.
For example, New Mexico has 136,000 occupied homes that are affordable to people earning 50% or less of the area median income. But 36% of them, about 47,000 homes, are owned by people who earn more than the median.
Workforce Solutions Secretary Sarita Nair said the mismatch isn't anyone's fault. "This is not people doing bad things. This is the natural dynamic," she said. "I myself live in a unit that's affordable to a lower income than I make. And I own it, and I'm never moving."
The takeaway, she said, is that the state needs more housing overall, along with more types of housing across the income range.
Statewide, New Mexico is short at least 50,000 homes affordable to low- and moderate-income households, meaning those earning 30% to 150% of the area median income. For a two-person household, that's about $24,100 to $120,500 a year. About 60% of households in that range are cost-burdened, spending about a third or more of their income on housing.
Most of the roughly $97 million request would go to "gap financing" for affordable housing construction, including $50 million in grants to developers and $30 million in capital outlay. Together, those two pieces make up about $80 million of the total.
"For now, we believe we need to continue to invest in or deploy grants that close that gap between what it takes to build housing and then what a low-moderate income household can afford to pay," Huval said.
The office's seven policy priorities also include building up local capacity and updating local zoning codes to speed up permitting, preserving existing affordable housing, and collecting more data.
Why it matters for Contractors
The $348,000 figure is the headline for anyone in the trades. It shows that the cost to build, driven up by construction, regulatory and capital costs, sits at the center of the state's housing problem. When a unit costs $73,000 more to build than renters can support, projects either get subsidies or don't get built.
That's why the $50 million in developer grants and $30 million in capital outlay matter. If lawmakers approve the money, it could help push more affordable projects from the drawing board to the job site, and that means more bids for contractors.
The push for faster permitting and updated zoning is also good news. Shorter permit timelines cut carrying costs, and that helps close the gap from the other direction.
The next legislative session starts in January, and the office's request will be one of many competing for state dollars. Contractors and builder groups who want a voice should reach out to their legislators now.