Some see real estate bright spots
EAGLE COUNTY, Colorado – It’s easy to see continued grim news in the county’s real estate market. And there’s plenty to be glum about. But there may be some signs of a slow rebound.
The good news is the number of sales last year. While sales in 2011 are at the same levels as sales in the late 1990s, it’s a marked improvement from 2009, when sales dropped more than 40 percent from the previous year.
Dollar volume for 2011 won’t match 2010’s level, but it will finish above $1 billion for the second year in a row. Dollar volume in 2009 dropped to just more than $800 million, a figure that hadn’t been seen since about 1997.
While those sales numbers don’t come close to 2005, the high-water mark for transactions, Chad Brasington, a broker with Prudential Colorado Properties, said he’s starting to see some good signs in the market, particularly with consumer confidence.
Sarah Jardis, president of Central Rockies Mortgage, said she’s starting to see some of that confidence, too, from both first-time buyers and people buying their first vacation homes.
“It’s an interesting second-home market these days,” Jardis said. “We’re seeing people from Denver or people who lived here once and want to come back. They’re saying, ‘This is the time.'”
Whether or not the market has finally hit bottom, Jardis said there’s a combination right now between prices – which are still well off their highs in the past decade – and interest rates, which are at or a little lower than 4 percent for a 30-year, fixed-rate mortgage. That’s buoyed both second-home and first-time buyers, she said.
Mortgage money is also available, although there’s far more paperwork involved now than in the boom days in the middle of the last decade.
“It’s more complicated now than it was, but it’s not really different than it was before mortgages got so easy,” Jardis said. “You can get these done, but sometimes you do feel like you’re swimming upstream.”
Still, there are plenty of obstacles to clear before the market can truly recover.
The local construction business is still faltering and probably will be until building new comes closer to the price of buying an existing structure, Brasington said.
But the price of existing homes has been dramatically affected by the number of bank-owned or “short” sales in the market. Through the end of November last year, there had been 270 bank-owned sales, most of which carried prices well below standard sale prices. That number doesn’t count short sales, which are generally priced a bit higher but still lower than asking prices for standard sales.
The lower-priced transactions have affected the entire pricing structures of some areas, Brasington said. On the other hand, there are areas where prices haven’t come down enough to spur sales. Eagle Ranch – one of the valley’s hardest-hit markets – saw several sales last year, while there were few sales in the Homestead area of Edwards.
While the market works through all of those problems, Jardis said she’s made a change in what she’s telling people.
“A year ago, I was telling people I was cautiously optimistic,” Jardis said. “Now I’m just saying I’m optimistic – things feel better so far this January than last January.”
Business Editor Scott N. Miller can be reached at 970-748-2930 or email@example.com.
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