Affordable Adobe

Her voice is old Santa Fe, echoes of Spain and Mexico mingling with a kind of weary cheerfulness flowing through her words. As long as Margaret Ulibarri lives in this small adobe house with her husband of 52 years, she says old Santa Fe has not yet vanished.

Their home is in Placita Rafaela, a quiet compound of five traditional dwellings along Acequia Madre (mother ditch), just a block from Canyon Road.

Thick with art galleries, new Mercedeses, and soaring real estate values, Canyon Road's wealth may be writing a requiem for the Santa Fe that Mrs. Ulibarri remembers.

Born and raised here, Ulibarri also raised her six children in the placita. Not too many years ago, open fields surrounded the adobes where her grandmother chopped firewood and washed clothes in the little stream nearby. "I could never bear the thought of living somewhere else," says Ulibarri, whose great-grandfather built the adobes. "This is my home."

The Ulibarris, who live on a fixed income, have seen the cost of living soar in Santa Fe. As tourism and housing boomed in this historic city of 60,000, known as "the city different," wages stayed well below the national average.

Thousands of moneyed newcomers buying or building homes costing between $600,000 and $1 million were welcomed in a pro-development environment that became one of the hottest real estate markets in the United States. At one point a city study disclosed that 75 percent of the families in Santa Fe could no longer afford to buy a house here.

An award-winning solution

When the city finally responded to the low-income housing need, the plan was unusual enough to win a prestigious Ford Foundation Innovations in American Government award two years ago. Today, housing experts hail Santa Fe as a model for cities of its size looking for ways to build affordable housing.

Ulibarri is the beneficiary of part of the Santa Fe plan. Had it not been for a $38,000 low-interest loan from Neighborhood Housing Services of Santa Fe (NHS) for major renovations, she and her husband would have had to move. Heating and plumbing in the house were more than 40 years old, and the roof even older.

Small adobes like the Ulibarris' were selling quickly at high prices to speculators who modernized the houses and put them back on the market. Santa Fe was becoming a mecca for the very rich and retirees living behind gates in subdivisions.

The median price of a home had increased to $200,000, leaving low- and middle-income families with four choices: Live or rent in older homes in the town's few marginal neighborhoods, scatter outside the city to modest, overcrowded housing, seek trailer park rentals, or simply move away.

"It wasn't that the city wasn't interested in providing affordable housing," says Michael Loftin, executive director of NHS, "but for a long time they weren't sure of what to do. They did a lot of studies, and then people in the city finally said, look, we have to do something."

A coalition cure

The city has moved boldly, forming an affordable housing roundtable in the early '90s by bringing together a coalition of local financial institutions, nonprofit organizations, and foundations. The McCune Charitable Foundation, the Pew Partnership for Civic Change, and the Enterprise Foundation were involved in the partnership.

Unlike any other city of its size in the US, Santa Fe decided to support existing housing entities, like NHS, and not reinvent the wheel with a new city housing bureaucracy. "No other city does this the way we do," says Jim Duncan, a senior planner in Santa Fe's Community Development Division.

As part of the plan, high-end housing developments in the city now have to either include affordable housing or contribute to a affordable housing fund.

But the crown jewel of the effort is Tierra Contenta, a nonprofit 850-acre mixed-income community established southwest of town by the city under former Mayor Debbie Aramillo. The project includes a school and plans to include businesses.

Aided by a $30 million bond issue and federal funds, successful housing subdivisions have been built here by private and public entities such as NHS and the Santa Fe Housing Trust. Southwestern-style housing is available for prices between $80,000 and $200,000. "Frankly, it's a miracle," says Owen Lopez, executive director of the McCune Charitable Foundation in Santa Fe. "People have nice places to live, and that builds community and self-esteem."

NHS developed an eight-hour class to help the first-time home buyer with training and counseling to understand the responsibilities of purchasing a house.

Through NHS, qualified home buyers receive down payments and closing-cost assistance, and low-interest mortgages. Under their home-repair program, owners of modest means, like the Ulibarris, can afford to renovate and stay.

A tough nut cracked

"Affordable housing is a tough nut to crack. But this city was ready to make it happen, and all the forces came together nicely," says Mr. Lopez.

Last year, 72 first-time home buyers used NHS services, and this year Mr. Loftin predicts 100 will buy homes. Some 60 houses will benefit from the home-repair loan program. Since 1992, 418 families have bought homes through NHS, drawing on $33 million in private mortgages.

"There's a big psychological change after you buy a home," says Loftin. "One woman voted in an election for the first time after she bought a house, because she felt permanent in the community."

While Mrs. Ulibarri is grateful she doesn't have to sell her home, witnessing the economic and cultural changes in Santa Fe hasn't been easy. "The house where I was born," she says, pointing to the adobe at the entrance to the compound, just "sold for $345,000."

As Santa Fe changed, so did the character of her neighborhood. "People started moving in and putting up fences and gates, and locking their doors," she says. "When we all lived here everybody was poor and good. We used to walk up Canyon Road and know everybody. Now there's probably one person who hasn't sold, and the rest have all become galleries."

City officials probably can't (and many wouldn't want to) halt such changes. But they are finding ways to keep this community affordable to teachers, landscapers, waitresses, and retirees like the Ulibarris.