Colorado Group Realty Insider - January 2021
With fear and uncertainty taking center stage in 2020, one thing is assured: the
pandemic has shifted real estate markets across the globe on an unprecedented
scale. Routt County was no exception with a feeding frenzy from June through
November that pushed sales volume to an eye-popping $1.2B. Not since 2007
has there been such a flurry of activity. Year over year sales volume growth from
2019 was 50%, shocking even the most experienced industry veterans.
Urban migration away from crowded cities and buyers looking for secondhome
mountain getaways led to a robust seller's market. COVID increased
the desirability of properties with access to the outdoors, more space, quiet
neighborhoods, home offices, and newer kitchens. Apparently, homes in the
mountains fit the bill where social distancing comes easier. Other Colorado
resort towns experienced similar historic surges as home values hit record
highs across the state, while inventory dwindled to all-time lows. In Steamboat
Springs, there is now just a meager 43 single family homes and 55 condo/
townhomes for sale, both down over 50% from a year ago.
Single family homes appreciated by 12% to $1.47M, while condos/townhomes
swelled by 19% to $636K. Droves of wealthy homebuyers snapped up luxury
homes at a record pace with 74 properties over $2M being sold, more than the
previous two years combined.
The surging prices led neighboring cities to go through booms of their own.
Homes in Oak Creek crested $600k, up 33% from last year, while Hayden saw
the average sale price increase by 10% to $333K. Some struggling buyers opted
to purchase land with 353 vacant parcels being sold, double 2019. Builders
should be busy for awhile as the city issued building permits for 208 new units
(single family homes and apartment units combined).
Many wonder if the market is due for a correction similar to the post-2007
irrational real estate bubble. While a valid concern, the market is hot this time
for very different reasons. Industry experts seem comfortable that no crash is
near. People have shifted where and how they live while working from home
has enabled them to move to their dream location. Low mortgage rates and
stringent lending requirements mean buyers can purchase only what they can
afford, unlike in 2007.
With the lack of inventory, it seems improbable 2021 can reach the heights of
2020, but demand from the COVID migration isn’t dwindling any time soon,
giving confidence of a healthy year to come.
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