New Mexico has put tens of millions of dollars towards housing, but rising costs have eaten up some of those funds

SANTA FE, N.M. (KRQE) – For years, New Mexico has been working on boosting the availability of homes and rental units across the state. But experts are noting that rising construction costs have eaten away at the pool of funding for projects.

New Mexico is working to implement a statewide housing strategy, which aims to increase affordable housing. Much of the efforts go through the Mortgage Finance Authority (MFA), but the group says their construction costs have ramped up in recent years.

Per-unit costs have increased 43% over the last five years for new construction projects, according to the MFA. Costs for acquisition and rehabilitation work has increased more than 56%.

These costs are “constraining how far the [state’s] money can go,” according to the Legislative Finance Committee (LFC).

The LFC says some of the cost increases have eased since 2021. But material costs for things like cement and steel “continue to fluctuate,” the LFC noted in a recent publication.