Downvalley real estate bargains draw buyers
EAGLE COUNTY, Colorado – Sales of bank-owned properties and “short” sales are driving the county’s real estate market. Is that setting us up for some kind of recovery?
In the lower valley, and especially in Gypsum, there are some bargains available. One bank-owned property is worth more than $180,000 on the county’s property-tax rolls. It’s on the market at $104,900. An older single-family, one-bedroom home there is listed for less than $90,000.
There were 132 completed real estate sales in the county in September, the highest one-month total since October of 2008. But three years ago, those sales totaled more than $165.3 million. The total for September of this year was just less than $83 million. In fact, September’s sales volume was only 35 percent of the total recorded in September of 2010 on 18 fewer sales.
Bank-owned property – about 20 percent of September’s total – seems to be moving pretty quickly.
Laurie Slaughter of Prudential Colorado Properties’ Gypsum office has been showing and selling a lot of bank-owned property lately, along with “short” sales – property that owners and lenders negotiate to a lower price so owners can move on without going through foreclosure or bankruptcy.
The bank-owned properties are especially inexpensive, Slaughter said.
“In some cases, we’re down to prices we saw in the late 1990s,” Slaughter said.
The lower prices aren’t good news for sellers, of course, but Slaughter said there’s a positive trend for some buyers.
“After years, we’re starting to see young, local, first-time home buyers taking advantage of the prices and the rates,” she said.
And, while standards remain fairly tight for traditional lending sources, Slaughter said 100 percent financing is available through a U.S. Department of Agriculture program. Other programs can get new buyers into homes for small down payments.
The short and bank-owned sales are also starting to make a dent in the valley’s inventory of unsold homes.
“We’re 12 percent down on inventory this year from last,” said Chad Brasington, another Prudential Colorado Properties broker. “It’s critical for us to see that kind of absorption.”
While Gypsum has taken the biggest hit on prices, the fact that homes are moving indicates prices are finally to the point where buyers are ready to make a deal. But the rest of the valley hasn’t seen that kind of adjustment yet.
“There are still neighborhoods that are out of whack on pricing,” Brasington said.
Clearing out unsold inventory would take time even if the number of foreclosures and short sales was constant, but Slaughter said there are more foreclosures on the horizon, as people continue to struggle with the economy.
“What do we need to do to get the economy going?” Brasington said.
The old answer was building permits. During the boom, just the town of Eagle would see 40 to 50 new-home building permits per year. In 2010, there were about four.
The days of quick sales also seem to be in the past, at least when it comes to lower-priced homes.
“Everybody has to be patient with short sales – buyers and sellers” Slaughter said.
But, for the people who buy and hold real estate, this market is a good one.
“If buyers hang on for the long haul, they’re going to be sitting pretty with equity in a few years.”
Business Editor Scott N. Miller can be reached at 970-748-2930 or firstname.lastname@example.org.