Eagle County Real Estate Market Report: While the overall market slows, positive signs emerging
On Real Estate
Since the onset of the stock market decline and inflation and interest rate levels rising this spring, the overall Eagle County real estate market activity levels have been slowing. While it is almost unfair to compare today’s market to the harried state of 2021, the numbers in November of this year compared to both 2021 and pre-pandemic November of 2019 demonstrate a marked shift.
In the valley, residential sales in November dropped 48% from a year ago and 36% from 2019. While prices have remained elevated due to lower inventory and resort sales, the market is experiencing the effects of a variety of factors — but there are signs that things are beginning to come into balance.
Most economists say we have likely seen the peak of interest rates and inflation — and both will slowly continue to come down — with interest rates remaining below our historic norms and allowing more buyers to enter the market and make moves within it. Buyers hesitant to purchase “at the top of the market” now have more purchasing power than a few months ago, but because supply remains tight, they should not expect deeply discounted homes — rather more options and less competition.
For sellers looking to make a move, the good news is that buyers are watching and waiting intently. Homes priced at market value are selling quickly as evidenced by the fact that days on market for homes sold in November declined by 25% compared to October of this year. Interest is high and while buyers may be waiting for the proverbial “bottom,” so too are others. When the right property comes to market, it’s best to be prepared so you can move quickly. Homes are selling at 97.76% of their last list price so there is room and opportunity to negotiate.
According to CJ Seatvet, luxury market specialist and associate broker with Berkshire Hathaway HomeServices Colorado Properties, the resort areas continue to remain steady with pricing, and any market correction is with homes that were overpriced initially. Demand is still high and multiple offers are still prevalent. Cash buyers still have the upper hand with offers. With limited inventory, many buyers are still having to make concessions on certain criteria, particularly if they are trying to do a 1031 Exchange, but they won’t overpay.
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As for sellers, Seatvet notes that those who list a fair market value are still seeing heavy interest and multiple offers. “A significant factor for sellers listing their home is they don’t have the next step,” said Seatvet. “If a seller is looking to downsize or upsize, they are hesitant to list their home with the limited inventory. It’s not a matter of it selling, it’s where they will go in a limited inventory market.”
Jennie Longville May, a luxury home/downvalley specialist and associate broker with Berkshire Hathaway HomeServices Colorado Properties, notes that the same priced-right pattern for homes selling quickly applies to Eagle County’s downvalley market, including Eagle, Eagle Ranch, and Gypsum. “As with the resort market, demand is still there,” said Longville May. “Buyers should be ready to go with financing, so they are prepared to move forward quickly with an offer when they find that right home.”
Like the resort/luxury market, demand is still strong. “Sellers need to understand pricing and strategy for getting their home sold. Homes that are priced at market value and presented well to the market are selling, and quickly,” said Longville May.
Should you wait?
“It’s a question we often get asked from buyers and sellers,” said Longville May. “We know what the market is today, and it is a healthy market. If you’re selling, you still have an excellent opportunity to get a great return on your investment. If you are buying, you have realized the Vail Valley is one of the greatest places to call home. Make sure you know what you can afford and have your financing in place if not a cash buyer.”
The resort/luxury and downvalley markets are very dynamic. Working with an experienced broker who understands these markets and how to negotiate contracts has proven to be in the best interests of both buyers and sellers.