The drought that set the stage for New Mexico's wildfires also devastated Santa Fe's peak homebuying season.

The number of home sales completed in August was the lowest in more than a decade with just 94 closings — a 21 percent decline. Sales in August were also lower than in the previous five months.

"August is peak season, historically," said Alan Ball, a title professional who blogs on Santa Fe real-estate issues.

Things weren't as bad in other parts of the country. National numbers released Wednesday showed a 7.7 percent increase in August compared to year-earlier sales of existing homes.

Warren Sacks, vice president of Barker Realty, said there was a huge "downward impact" on the market here in the first half of July, when national media focused on the Las Conchas wildfire and its proximity to Los Alamos National Laboratory. Hotels had a lot of cancellations, and people who had planned to come to Santa Fe went elsewhere, Sacks said.

His agency saw a 20 percent decline in showings, which rippled into fewer contracts and sales.

The fires began in mid June with the Pacheco blaze near Tesuque. Then the Las Conchas Fire sparked in the Jemez Mountains, burning from June 25 to late July. The summer fires throughout the state consumed almost 500,000 acres.

"There was smoke in the air, there were air-quality alerts; it was horrible for us who live here, let alone inviting other people here," said Donna Reynolds, executive director of the Santa Fe Association of Realtors.

She said buyers who had planned trips to Santa Fe decided to come another time.

Many agents, she said, were also busy housing evacuees, and the association took food donations to shelters.

"There was real slowdown. Maybe everything stopped for a week. It really impacted August numbers," Reynolds said. "I don't think they said, 'I'm not doing Santa Fe.' They just said, 'I'll do it another time.' I suspect September numbers will go another direction."

But Frank O'Mahony of Evolve Santa Fe Real Estate thinks more is at play.

"It would be nice to blame it on the fires, but it's not just the fires," he said.

Santa Fe is a more expensive market than many other areas, so purchasing a home here is more of a testament to the future. And with increasing financial uncertainty about the debt-ceiling debate and European defaults making headlines this summer, buyers turned cautious, O'Mahony said.

"There is so much fumbling of this national-international economic crisis that I believe a citizen is just baffled about the future and afraid to make any big decision," Ball added. "The comfort level from the power at the top is not reassuring."

Already-low interest rates took another tumble Wednesday. Still, there are already signs that sales may have been postponed but not forgotten.

Showings and "under contract" homes were up in August, and that is rippling into higher September sales, Sacks said.

Sacks also said the $1 million-plus market is holding up well, with 70 closed sales so far this year — up from 57 in 2010.

"I see a lot more traffic this month," O'Mahony said. "I know there are people in town buying homes. And it does feel better than it did in July and August."

Contact Bruce Krasnow at 986-3034 or brucek@sfnewmexican.com.