Vail area real estate price increases squeezing out first-time buyers
But the market remains red-hot, with $2.1B in sales through the end of July
It’s a good time to own real estate in Eagle County. It’s not such a great time to buy a first home.
Low inventory and high demand have had the almost inevitable effect of spurring price increases throughout the market.
That’s one reason the local real estate market by July 31 had posted more than $2.1 billion in sales. According to data from Land Title Guarantee Company, the 2019 sales volume for the entire year came in at just less than $2.3 billion. Sales volume for the first seven months of 2019 came in at just more than $1.1 billion.
Numbers for 2020 are skewed due to the COVID-19 pandemic’s impact on transactions for the second quarter of the year.
Much of that sales volume has come in the upper reaches of the local market. Still, average prices are up across the board.
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Matt Fitzgerald, the Eagle County president for Slifer Smith & Frampton Real Estate, said there’s been a 19% year-over-year increase in prices from 2020 to this year through the first seven months.
Again, much of that has come in the resort markets.
Tougher for first time buyers
But Delfina Darquier, a broker with Engel & Volkers Real Estate, said the price increases are hitting first-time buyers. Darquier noted that condos at Sunridge or Liftview in Avon that were selling last year for less than $350,000 are now priced around $550,000.
“It’s getting tougher and tougher for first-time buyers,” Darquier said. “They’re struggling to find something that fits their budget.”
Many buyers are looking into town or county-sponsored programs, existing units with deed restrictions or both, Darquier said.
But, she added, there’s now competition for some deed-restricted units that aren’t appreciation capped.
Fitzgerald said he’s “glad” to see the county’s “Bold Housing Moves” initiative, which includes roughly $10 million to bolster down payment assistance, deed restriction purchases and a program qualified residents can use to compete with cash buyers.
Eagle County Housing Director Kim Bell Williams said the county’s perpetual housing crunch has only been exacerbated by the COVID pandemic.
“We all know why we moved here,” Bell Williams said. Others have discovered the county’s charms, putting more pressure on an already-tight housing market.
Those price increases have made home ownership difficult without help, Bell Williams said on her way to a presentation to Eagle County Schools’ employees about Bold Housing Moves.
Participants in those programs have been happy with the results, Darquier said.
In fact, many brokers are enthusiastic about those and other deed restriction programs.
Little debate now
Fitzgerald noted that brokers and others have long debated the advantages of deed restricted and free market units. Now, though, many are seeing that the benefits of home ownership are better than perpetually renting.
But there’s only so much assistance available.
While Eagle County dedicated $10 million to Bold Housing Moves, Bell Williams noted all that money is set to be spent in the next 12 to 14 months.
But an offshoot of supply and demand is that when prices rise too much, demand tends to soften.
Fitzgerald said it’s too soon to tell if demand has started to be affected by pricing.
A home in the right location that isn’t overpriced tends to sell quickly.
“It’s highly dependent on the individual property,” Fitzgerald said, adding that a super-quick sale “isn’t the blanket statement it was even a few months ago.”
$1.388 million: Average Eagle County real estate transaction price through July 31.
$750,000: Median real estate transaction price for the same period.
$2.1 billion: Dollar volume of Eagle County real estate transactions through July 31.
1,576: Total Eagle County real estate transactions through July 31.
Source: Land Title Guarantee Company