Santa Fe is a small, affluent area with a vibrant arts scene and a heavy reliance on tourism.
Because of its small size -- the city's population is less than 70,000 -- and the fact that a large percentage of its housing stock is used as vacation homes, "you see greater market fluctuations there than most places," said Errol Samuelson, president of Realtor.com.
After falling 20% since 2007, home prices are forecast to rise 9.1% over the next five years -- the second highest price gain in the nation, according to Fiserv.
Now that the market is heating up, he said people are starting to put more properties up for sale.
Yet, homes are selling slowly here, staying on the market for an average of 147 days. That can give buyers some leverage with anxious sellers when negotiating prices.
