Vail Valley real estate market softens, but work continues
While much of the valley has closed down, brokers are open for business via technology
It’s too soon to say what the coming days, weeks and months might bring, but local real estate companies are still operating, albeit in a different way.
Following the lead of many, if not most, local businesses, real estate offices are doing as much remote work as possible, via phone, email and video conferencing.
At LIVSotheby’s International Realty in Beaver Creek, managing broker Dan Fitchett said that firm is doing “virtual showings” for customers, using photos and videos of properties for sales.
While much of the valley has closed down, Fitchett said, “We’re very much open via technology.”
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And, Fitchett said, technology is actually showing some benefits. The company recently held a staff meeting via the Zoom conferencing app.
The company recently held a Zoom meeting with the sales staff.
“We had the biggest attendance we’ve had,” Fitchett said.
And, while business has declined, deals are still being done.
“It’s obviously quieter than it should be in mid-March, we’re still helping people do the things they want to do,” Berkshire Hathaway HomeServices Colorado Properties owner and president Michael Slevin said.
Like Fitchett’s firm, Slevin’s team meets every day via Zoom.
“We provide guidance and insight into a situation we’ve never seen before,” Slevin said.
John Pfeiffer, the president and managing broker of Slifer Smith & Frampton Real Estate, said that company is also slower than it was a month ago. But, Pfeiffer added, “We’ve not skipped a beat. We’re still having new contracts come in, some of them fairly substantial.”
While business is continuing, if at a slower pace, there’s a good bit of confusion in part of the industry.
Mortgage rates rising
Jimmy Brenner of Blue Sky Mortgage said mortgage interest rates have gone up recently. Those who once could land a 30-year mortgage in the low 3% range are now looking at rates of about 5%. That can make a significant difference in a monthly payment.
And, Brenner said, he’s fielded calls about the Federal Reserve’s weekend move to drop its interest rate to lenders to essentially zero. Some callers wonder if they can get an essentially no-interest mortgage.
That’s not how it works, Brenner said.
The Federal Reserve loans money to banks, and those institutions then re-loan the money to other institutions and consumers.
In fact, Brenner said, the Fed’s move actually put upward pressure on mortgage rates.
But, Pfeiffer said, even a mortgage at 5% is still a good deal. Rates in the range of 3% to 4.5% are “not the norm,” he said.
Brenner’s contacts in the industry believe that the current COVID-19 virus outbreak has triggered a worldwide recession. That’s a necessary correction, Brenner said.
But, Pfeiffer said, the market’s fundamentals are different than they were during the global economic slump that hit full force in 2008.
“We didn’t have the big run-up (in prices) this time,” Pfeiffer said. “People have borrowed responsibly, and the economy was strong when we started this.”
Still, Brenner said, it could take months for the financial markets to stabilize.
“Our underwriters are going to be changing things a lot,” Brenner said. “We don’t have any definition yet.”
Pfeiffer acknowledged that life is going to be different moving forward. Some things haven’t changed, though, he said.
There are still a lot of fundamentals in place,” he said. “And people still want to be in the valley.”
Vail Daily Business Editor Scott Miller can be reached at email@example.com or 970-748-2930.
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In the wake of the terrorist attacks of Sept. 11, 2001, a number of people decided they’d had enough of city life, and the Vail Valley gained some new residents. The same may be true in the wake of the COVID-19 outbreak.