Cloudcroft's Real Estate Market: Checking in with Local Guru Justin Muñoz
Cloudcroft's Real Estate Market: Checking in with Local Guru Justin Muñoz
The Future Real Estate founder talks about the mountain market, fire, custom builds, Cloudcroft culture, and more.
The real estate market in Cloudcroft has changed in recent years for many reasons, and so have the brokers who help customers buy and sell land and homes.
Today, a brokerage company started barely ten years ago by Justin and Marianne Muñoz, Future Real Estate now leads the Cloudcroft area in market share by a wide margin. Take a look and you may see their signs everywhere.
The Cloudcroft Reader sat down recently with founder and CEO Justin Muñoz, a Cloudcroft native, to discuss the state of real estate in Cloudcroft and its challenges from his unique perspective.
Below: Our July interview with Muñoz in his Cloudcroft office for Future Real Estate, edited for length and clarity. We began by asking about current prices.
Then and Now: Price per Square Foot
"Today's price per square foot (of a residential property in Cloudcroft) has tripled from where it was 20 years ago."
"In 2004, the price per square foot ranged from $52 to $128. In 2004, the range was $97 to $384 a square foot."
"The median sold price in the village in the last 20 years has gone from $129K to now $300K. But you must realize there are highs and lows with it now."
"We have brand new homes. We have ancient, 100-plus-year-old homes, and we're all kind of mixed up in different quality locations. We have a shady and sunny side and other kinds of preferences."
"We also have fewer multi-million dollar buyers than you would in, say, Alto. In northern New Mexico, many people are okay with spending millions, though you'd be surprised how many millionaires live in regular old houses here. They're not flashy. It's not a showy type of town."
"We're at a steady, stable market right now. I like a steady market. We expect the interest rates to decline throughout the year, though not significantly.”
“We've already seen some high fives, like VA loans, but most people are still in the sixes. And then, as far as assumable, VA still has assumable loans. They had a 2.75% interest rate, allowing some buyers to assume the rate."
The Current Market and Who's Buying
"Our market has been killer this summer compared to last summer. Typically, I've seen that about 50% of buyers here are cash buyers."
"The majority of customers are second-home buyers. We have quite a few people I've seen moving to the area, many working from home. I've seen more of that than I previously saw pre-COVID. People, especially in business, can operate anywhere now."
"We have quite an older clientele, many people heading towards retirement looking for a second home, and many vacationers who fell in love with the area and decided to move here."
"More younger people have come to the area, you know, more people in their 30s and 40s than I remember ever seeing."
"We live in a custom home market. So there are times, especially with low inventory, when people pay more than a property is worth. If you have the cash and love the land, the view, whatever it is, you'll do what it takes to get that."
"Regarding where it's going, we've seen it steadily rise in the last year. This year, we've seen it a little busier.
“We saw more land sales than I've ever seen in this previous boom—lots that would generally sit on the market until someone would give it away are suddenly going for full price."
"We still get quite a bit from West Texas. People are moving here permanently and for second homes—a ton from West Texas. San Antonio makes their way over here. We're the closest mountain to them. We see buyers from El Paso, Las Cruces, Lubbock, Odessa, and we have a lot of eastern New Mexico in some of the oil areas that come up here."
"One thing we always know about Cloudcroft is its great weather. Desert people surround us, and our desert friends will always want to flock to these pleasant, cool climates like Cloudcroft. And we're a cool town as well."
Building New Homes
"With that, many people came in with the same idea. Oh, let's build, let's build, we're going to build."
"But there are only so many builders. We're a very custom home market. We don't have volume builders up here building subdivisions where all the houses look identical. It's very custom."
"With that, the builders get in with the owner, and it's a long process. They have to design it. So you're waiting for the architect, and you're waiting for the builder."
"As far as I've heard, most builders are at least a year or two out before they can even entertain starting a project. I've heard some builders four or five years out. And the cost of materials is still high. So that's a challenge."
"The labor pool is smaller around here. You only have so many construction workers. They can't just double their team suddenly."
"(In Cloudcroft) I would say there are five or six top builders. Beyond that, as far as the mountain area is concerned, there are plenty of other builders in Alamogordo now, but they typically don't cross the line.
Mountain building is just very different, a different experience. "
"It's interesting (what attracts buyers to Cloudcroft). It depends on what they fell in love with in Cloudcroft. Some people fall in love with the quiet hikes. Some people fall in love with the bustling town on a Saturday. And some people love to live in town and be able to walk everywhere. We see a well-rounded mix of that."
Fire and Insurance
"I have not seen contract terminations based on people's inability to get home insurance. It does happen. It is a challenge for some."
"Where it's going is more of a concern. The insurance companies that I've spoken to, the local ones, their stance in it is if you are paying for insurance now, don't give your insurance company a reason to cancel.
“Make sure you're doing everything they need you to do. Pay a year ahead of time. Don't pay month to month. You want to be ahead of it as much as possible."
"While many insurance companies are pulling out of the mountains, there are other insurance companies, and plenty of them are still doing business up here."
"But every problem has a solution. And so, this house doesn't qualify now, but it can be eligible. You have to go through specific steps. The main issue I see with houses not qualifying is usually the roof's age. It's too old.”
“You know, insurance loves metal roofs. They'll take an older metal roof but only a shingle at a certain age. Insurance companies don't like to see missing shingles, peeling paint, rotting wood, debris in the yard, cracked or messed up siding, and overhanging tree limbs — any foliage touching the house."
"The advice from an insurance company is to clean up your land and make it as fire-resistant as possible.”
“So it's not only just removing the tree clusters but opening them up a little bit and trimming them up higher above the fire line. Then, of course, clearing overgrown brush. You know how flammable pine needles are.”
“So, the homeowner doing a good job there will help alleviate many liabilities."
"The agent's name I often hear, especially after the Riodoso fires, is Ashley Dalton with Farmers. She does a lot on the mountain."
"Remember your tenant insurance if you're a renter. There were a lot of tenants who didn't have insurance and lost everything. That's one of the cheapest insurances you can usually buy. Just tag it on with your car insurance."
Short-Term Rentals in Cloudcroft
"There's only so much data (about vacation rentals), so grabbing an exact report is tricky. We're a non-disclosure state, so you don't always know where everything goes."
"To me, consumers have more options with the hotels, the Lodge, cabin rentals, and tons of nightly vacation rentals. It allows us to host more people in our town, in general. Having more of these is great for the economy.
"One thing I've seen over the last few years is a slight decline in occupancy rate regarding vacation rentals. We attribute that not to a lack of people in town but to more vacation rentals. So that's caused different implications: it's harder for people looking to rent here."
"You have a buyer, often a second home buyer, coming to Cloudcroft to purchase a property. It's great for them because it's a second home, they have a full-time career, and they can't just come here all the time. They like to put it out as a vacation rental, generate cash flow, and, hopefully, break even or make some money."
"With that, fewer homes are available to full-time renters or owner-occupants. That can make housing more competitive, which can drive prices.”
"For the local population that's full-time here, that makes it harder for them. So many people have to commute from Alamogordo because they can't find a rental here.”
“Yet I think the positives outweigh the negatives."
Building The Future Business
"I started my real estate career here in Cloudcroft.”
“I'm from Cloudcroft; I graduated from here. My partner, Marianne, and I were living in Cloudcroft, and she and I were dating. We decided to get into real estate together in 2013."
"When we started, we worked two jobs to make ends meet. Cloudcroft is a small town; the market was really slow. So, we decided to move to Alamogordo to give real estate a real go. We worked for Coldwell down there. Three years later, we decided it was time to do our own thing and opened Future Real Estate."
"We had a precise vision of how we were running our team at the time, how we wanted to do business. And we just had a lot of plans. We opened up in February of 2016 as a virtual brokerage. It was funny because people would ask, 'Well, where's your office?'”
“Everywhere, we answered. People didn't know, around here at least, what a virtual brokerage was. So it was a lot of educating what it was."
"By the end of our first year, we were already rated number three in Otero County. So we were moving along at a pretty good pace. And then, within about a year and a half, we started growing at a pace that needed a brick-and-mortar."
"So we bought our first office down in Alamogordo. We also had an excellent referral relationship with Randy Everett, who ran Blue Canyon Realty then.
“And then another year goes by, and we say, Hey, we're coming up to Cloudcroft. I'm from there. This is my hometown. So I'm ready to compete. And we got a brick-and-mortar up here as well. Shortly after, we also got a brick-and-mortar over in Ruidoso."
"In our minds, the idea was that the three towns have much in common, with people moving from one town to the next. A lot of second-home buyers are looking in both territories. There are some significant advantages to that.”
“We sold our Ruidoso location in 2020 to one of our associates, Jeffrey West, who helped us start that office. He owns and operates that and licenses the name. We still own Future Real Estate, but he runs that as an independent office. And that allowed us to focus on the Otero County business side."
"We were booming at the time. Our sales were almost doubling year over year. We went from $16 million in our first year, which was pretty epic, to a high of $209 million during the pandemic. We call it the 2020 boom, but '21 and '22 are the biggest years we've seen in our career in real estate since 2008. So it allowed us to focus here."
"I think one of our niches that helped us succeed with Future Real Estate is, you know, my age (42 years). I'm the oldest millennial, you know, in the range of that.
And so I came into this business there were only five people, I think, in their 30s when we joined. I had a niche of just understanding the online stuff. And so that's where I went all in— online. And the marketing and advertising online piece is what separated us."
“The reason we have had the success we have had is because of our team. They are great realtors that truly strive to raise expectations.”
"In 2018, I pulled out of sales entirely. It allowed me to focus on helping the associates dive deep into marketing, advertising, and the company's operations. It allowed me to focus on one thing I could do well."
"As far as our company's numbers, 2022 was the high. And our numbers now mirror 2021 and 2022 in the first quarter of this year. By the time we got halfway through this year, we were ahead of our '21 and '22 numbers as a company."
"As an overall market, the numbers are down slightly from that boom, but we are capturing more market share.”
"This year, our company has sold 34% of all sales in Otero County; about one out of three buyers and sellers have gone with a Future Real Estate associate."
"In the Cloudcroft mountain area, our stats are 54% of the mountain area, which is one out of two buyers and sellers. And as a comparison in the mountain area, our nearest competitor is at 13%."
"All of our statistics are from the Otero County MLS."
"Looking at residential site-built homes as an example currently active in the mountain area, we have 61 in the mountain area site-built residential homes. Out of those 61, 25 are in Cloudcroft."
Evolving Cloudcroft and Community Engagement
"I don't think I've ever seen so much construction happening as we have in the last couple of years. You saw construction at Mad Jack's. You saw new owners across the street in the [Village] Plaza. You saw the church remodel. You saw the Allsups happen. You've got Bigfoot next door; it's one of the coolest buildings.”
“We remodeled our (Highway 82) office, and there's a new hotel down the road. The list goes on."
"The new pickleball courts are an excellent addition. I've never played out there, but that will be a big draw for people.
"Many people I grew up with moved away, explored the countryside, and tried cool new areas. Now we see this influx of many old friends from high school who have moved back. We have seen some different cultures, the music industry, events, and really neat things. So we had a lot of ideas coming back to our little hometown."
"One of the things we were a big part of was pushing a lot of music. I'm a musician myself, and we would play at the local bars, events, and festivals, and then we created a festival (BAMM, Bad Ass Mountain Music) ourselves because we didn't have one.”
“Now, we have music every weekend at the Cloudcroft Brewing Company. We have the Western."
"We sponsor local intitatives when we can. We've given donations and scholarships to high school kids here from Future Real Estate. We just gave a couple of grand to high schoolers this year. We contribute to the local organizations as much as possible. We try to spread the love."
A Changing Village with Slow-Paced Appeal
“If I were to define (Cloudcroft's charm), it would be an experience, a feeling, a culture, a temperature, the tranquility of it, the people, the sincerity.”
"I graduated from here. And I moved away for ten years. I moved to a city. I remember, when I walked down Burro Street, you know, I nodded my head, "Hello, hello," waved my head, "Hi." You see, it's just like an everyday thing. We pass cars on the road and give them the finger up, not the middle finger, the right finger [gestures a peace sign]."
"Then I moved to a big city, and when I would pass people on the sidewalk because I was a small-town guy, I'd be like, "Hello," and they would look at me like, ‘What?’”
"I had these small-town niceties that are just normal here, and then you go to other places, you realize that's not as normal as you would think."
"We are not like we were 50 years ago. In many ways, we are different from what we will be 50 years from now. There's a debate on whether we change or not. As I've gotten older, I've learned how to appreciate certain things that are not changing so much and so fast, not being as loud and chaotic.”
“I enjoy the slower-paced side of life. In Cloudcroft, you can walk by a window, look out, see a [wild] creature, and smile."
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