Colorado Group Realty Insider - May 2020
As we tiptoe out of quarantine, it’s apparent that every corner of the globe will
be affected in some way. This includes real estate in Routt County where April
sales volume was down 53% compared to April 2019. After a huge first quarter,
which included an active March, total market volume is now down 6% year over
As home buyers and sellers navigate new safer-at-home orders, transactions
are still closing, just not at the rate that we’re used to. For most of April, inperson
showings were barred, meaning May and June sales volume will be
weak. Now that showings are allowed again, albeit with safe social distancing,
we can expect an uptick in activity as the number of pending contracts rise.
It’s hard to fathom that just 75 days ago we had historically low unemployment,
record sales volume in real estate and all-time highs in home values. We continue
to see that it’s hard to compare this situation to any other downturn. The most
recent recession in 2009 was started by a credit collapse in the housing system
which took down global economies. Heading into that recession, in which
Steamboat home values dropped by 19%, there was a loose credit system and
declining household formation. The good news is that those attributes didn’t
exist heading into this downturn; in fact, many national economists believe
housing will be one sector that helps the economy recover.
We still have historically low supply with only 300 active listings in Steamboat.
Unless demand dwindles significantly, home values in many segments will likely
hold solid. Locals housing, such as single-family homes under $1.5M, remain
in the tightest supply. Some relief is coming this week, as applications will be
taken for locals looking to live in Alpenglow Village, the 72-unit affordable
housing project which opens this summer. Investment properties that rely on
nightly rental income may see the most downward pressure on values as the
investment thesis may be temporarily harder to justify if less tourists visit.
Sellers took a pause on listing in April with only 59 new properties hitting the
market, half of what it was in April 2019. If buyer demand remains solid, it will
no doubt encourage sellers to list sooner rather than later.
We are happy to be a resource to you during this time; please let us know if you
have any questions.
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