Prices are up, but the increases may be leveling off
When the Eagle County real estate market recorded nearly $3.5 billion in 2020 sales volume, a lot of people thought, “That surely can’t happen again in 2021.” Those people were wrong.
As of Sept. 30, the end of the year’s third quarter, the county’s sales volume was just more than $2.9 billion, so another $3 billion year seems likely.
Transactions are also poised to break the 2020 mark of 2,572 sales.
All that action, and a continuing shortage of inventory, has contributed to drive up prices.
According to the latest data from Land Title Guarantee Co., the average single-family home price increased 23% in Eagle from the first three quarters of 2020. The average price of a multifamily unit in EagleVail rose 20% in the same period.
Michael Slevin, owner and president of Berkshire Hathaway HomeServices Colorado Properties, said the market run-up that began in earnest in June of 2020 actually started in the months before the COVID-19 pandemic hit in March of that year.
“There was a real push for people making lifestyle decisions,” Slevin said. “The pandemic expedited a trend that was already happening.”
People have been making a choice to work remotely and deciding to take advantage of technology to live in desirable locations.
‘People aren’t waiting’
“People aren’t waiting any more,” Slevin said, adding that in some cases, people move first, then decide how they’re going to work.
As is usually the case in Eagle County, a relative handful of sales of high-end homes has tended to drive up both the overall dollar volume and the average sale price. September’s total was driven in part by 12 sales of more than $5 million. Those sales accounted for more than $117 million of the month’s $454 million in volume.
Given the relatively tight supply of homes, strong demand has caused prices to increase. But that upward trend may be starting to level off.
Steffen Mehnert, the team leader of the local branch of Keller Williams Realty, said he’s seeing a shift toward a more “healthy, balanced” market.
Mehnert said that recent figures show that of all the homes listed for sale at less than $5 million, 20% had seen price reductions. The days of people paying over asking price for homes may be over, at least for now, Mehnert said.
While the days on market data is rising in the local Multiple Listing Service, Mehnert added that there’s still some “aggressive competition” for some properties, particularly those priced at less than $1 million.
While prices may be leveling off in some sectors, it’s still a hard market for first-time buyers to crack.
“My heart goes out” to those buyers, Mehnert said.
But demand doesn’t seem to be easing much at the moment. And, Slevin said, remote workers may be a big part of the nonresort economy the valley has tried for years to develop.
“Technology has created its own industry, with people being able to live, work and raise a family without necessarily creating the brick and mortar we were expecting 15 years ago,” Slevin said. While other industries may yet come to the valley, the valley’s “critical need” for year-round activity has been met largely with remote work, he added.
And people coming to the valley for recreation, culture and other amenities isn’t likely to change soon.
But, Mehnert added, the market continues to be difficult for many to buy into.
“It’s getting harder and harder,” he said.By the numbers
$2.9 billion: Value of Eagle County real estate sales through Sept. 30.
$3.49 billion: Value of 2020 Eagle County real estate sales for the full year.
2,081: Eagle County real estate transactions through Sept. 30.
2,572: Eagle County real estate transactions for all of 2020.
Source: Land Title Guarantee Company