Vail Valley real estate market volume passes 2007 level
While dollar volume is back to boom-time levels, number of transactions is dipping
- $1.4 billion: Eagle County real estate sales volume in 2013.
- $2.279 billion: Eagle County real estate sales volume in 2013
- 2,019: Eagle County real estate transactions in 2019.
- 2,150: Eagle County real estate transactions in 2017.
- Source: Land Title Guarantee Company.
This story has been updated to more accurately reflect a quote about annual appreciation in the Vail Valley real estate market.
It took more than a decade, but Eagle County’s real estate market in 2019 finally roughly matched the historic peak set in 2007 in dollar volume. Transactions are a different story.
According to full-year data from Land Title Guarantee Company, it took 2,019 sales in 2019 to generate the year’s $2.279 billion in volume. That transaction number is a decline of 75 units from the number of transactions recorded in 2018. The 2.150 transactions posted in 2017 is the largest single-year number since 2013.
Michael Slevin, owner and president of Berkshire Hathaway HomeServices Colorado Properties, said the number of transactions is primarily a function of available inventory.
“Inventory is down about 10% from (2018) year-end,” Slevin said. “That’s been the driver of fewer unit sales.”
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Slevin added that an increase in prices over the past few years has had an effect on the number of first-time homebuyers who can enter the market.
Slevin noted that more new units are coming to market. But, he added, it remains to be seen how construction costs will affect affordability.
Slevin noted that 40 new townhomes will come on the market this spring or summer in Gypsum’s Stratton Flats neighborhood. Those should be priced “well under” $400,000, Slevin said. Those homes will have garages. Most important, they’ll be new, which is what people tend to want.
Waiting for the right thing
“People are still looking for newer construction,” Slevin said, adding that buyers aren’t inclined to take on their own remodeling projects.
“Some of our inventory is not meeting those needs.”
Led Gardner is a broker in Slifer Smith & Frampton Real Estate’s Bridge Street office in Vail.
“Inventory is our biggest challenge,” Gardner said. Gardner added that once a client runs down his or her wish list for a property, the list of available homes narrows quickly.
A few years ago, that list could include eight or 10 units, Gardner said. These days, it’s more common to have a list of only three or four homes.
While the valley’s dollar volume is once again to the level seen during the boom years of the early 2000s, Gardner said the market is different today, even accounting for inventory.
No ‘feeding frenzy’ today
Gardner recalled the market of 2006 and 2007 as a “feeding frenzy.” Homes across the spectrum sold quickly and appreciated rapidly. Units from new projects such as the Arrabelle at Vail Square sold several times before those buildings opened. Gardner recalled there were roughly four buyers for every available unit.
“It’s not like that now,” Gardner said, adding that “buyers are rightfully waiting” for what they want.
But waiting comes at a literal price. The average price of a single-family home in Eagle County increased by more than $165,000 from 2018 to 2019. On the other hand, that average includes the prices of homes priced at $5 million or more.
There was a decline in the sales of those homes in 2019 from the previous year. But, Slevin said, there are a limited number of homes in that price range. When units in that rarified part of the real estate spectrum come on the market, it’s more a matter of the owners’ preferences than larger market forces.
And those market forces seem solid at the moment — with the understanding that some shock to the national or world economy can occur at just about any time.
Slevin said his brokers at the moment have more units under contract today than they did 12 months ago.
“The valley from East Vail to Dotsero is a sought-after destination,” Slevin said. “It’s a great place to live, vacation or retire.”
And, while prices are increasing, Gardner said the annual overall dollar volume appreciation of 1% to 2% “seems to be a sustainable growth trend. We seem to be in a very solid place right now.”
Vail Daily Business Editor Scott Miller can be reached at firstname.lastname@example.org or 970-748-2930.