A smart real estate buyer knows the national housing market has changed dramatically and seemingly overnight. In May, 2007, we heard whispers about subprime mortgages confined to a few unfortunate borrowers. A year later, we were hearing about the enormous number of home foreclosures —around four million through December 2008, with another reportedly two and a half million homes whose mortgage debt exceeds equity. Most of these loans should never have been made. But anyone can be smart in hindsight.

You’ve also probably heard that the three most important words in real estate are “location, location, location.” Can that still be true in the new paradigm of less leverage and newly priced assets? A smart buyer knows that the guiding principle of sound real restate investing doesn’t change just because markets fluctuate.

He also knows that all real estate markets cannot be painted with the same brush. Despite dislocations nationally, Santa Fe and New Mexico as a whole have experienced relatively minimal foreclosure numbers, about thirty a month in 2008, according to an article in the New Mexican.

In a Washington Post series last summer, “Anatomy of a Meltdown,” New Mexico represented one half of one percent of home mortgage foreclosure in the country. In November, 2008, the Kaiser Family Foundation ranked New Mexico number 43 out of 50 states in lowest number of foreclosures. Our neighbors (Arizona, Colorado, Texas) were all in the top ten.

What if you’re a smart buyer in “pause mode”--what do you need to know to move from “paused” to “Properly Positioned to Buy Smart?” Ignore most real estate stories of calamity and doom. Good information provides the best lens for seeing the truth. According to the Santa Fe Association of Realtors, here’s a snapshot of five significant price ranges (city and county statistics combined) in 2008:

$300,000 and under: 298 homes sold, with an average of 140 Days On Market (DOM); average sales price $242,864; discount of 95.53% off final asking price; $183.57 per square foot; 199 homes currently active on the market – estimated time for these to sell: 95 days.

$301-500,000: 315 homes sold, with an average of 156 DOM; $383,763 average price at 95.53% of final asking price; $213.08 per square foot; 279 homes active on market – estimated time to sell: 323 Days.

$501-750,000: 179 homes sold, with average of 176 DOM; average sales price $611,565 at 94.95% of final asking price; $260.57 per square foot; 227 homes active on the market - time for these to sell: 230 Days.

$751,000-1 Million: 86 homes sold, averaging 182 DOM; average sales price $867,667 at 95.56% of final asking price; $303.80 per square foot; 175 homes active on the market – estimated time for these to sell: 472 Days;

$1Million – 2.5 Million: 101 homes sold, with an average of 273 DOM; average sales price $1,449,197 at 92.16% of final asking price; $371.87 per square foot. 229 homes active on the market – estimated time for these sales: 559 days.

The smart buyer knows that sales may be down from the runaway markets of 05 and 06, and days on market are now longer, but 2008 was hardly an anemic year. While some buyers may sit on the sidelines waiting for “the right time” to buy, others realize that opportunities are presenting themselves right now. Thirty seven year low mortgage rates, and gradually thawing credit, should mean that sometime in 09 inventories will stop building, and prices will stabilize and even begin to inch up, particularly if inflation results from the Obama stimulus package. The smart buyer doesn’t look in the rearview mirror. He or she looks ahead.

The National Association of Realtors Economist Lawrence Yun recently made the point that estate appreciation has paralleled inflation and consistently exceeded it in the long run by a couple of percentage points.

Some smart questions to ask: “Does making a move in this market fit my financial comfort profile? In taking action now, can I visualize later being satisfied with my good judgment and not regretting inaction? How much value lies in purchasing a particular property because it meets my needs, and is price always the most important consideration in making a decision?

Educating yourself with statistics is a first step. Contact your Realtor for more in-depth knowledge of the price range and neighborhood you’re thinking about. Carpe Diem!