A lot of economic comparisons to 2021 are often skewed. But Eagle County’s real estate market has slowed considerably.
The latest data from the Vail Board of Realtors shows some significant dips in several areas, with a few important exceptions.
Leading the declines is the number of new listings in August as compared to the same month in 2021. August of this year saw a 39.3% decline in those listings. August’s closed sales also declined nearly one-third from the previous year. Housing affordability declined nearly 29% year over year.
On the other hand, the inventory of active listings grew slightly, by 8.5%, and the month’s supply of inventory, which grew by more than 52%.
Even those encouraging numbers come with a caveat.
The Sept. 27 count of listings was 309 on the Eagle County Multiple Listing Service. While that’s far better than the number of listings seen a year ago, Mike Budd of Berkshire Hathaway HomeServices Colorado Properties said the current number is still about half of what it traditionally is.
There’s also just less than three months’ supply of homes on the market, given current sales rates. That’s better than August 2021, when the inventory was just less than two months’ supply.
“That’s still not a market in balance,” said Matt Fitzgerald, Vail Valley President of Slifer Smith & Frampton Real Estate.
Fitzgerald added that demand remains strong in the market’s upper reaches — $3 million and up. That comes despite this year’s steady declines in the country’s financial markets.
The story is a little different in the portions of the markets in which buyers are likely to obtain mortgage financing for their homes.
Recent interest rate increases by the Federal Reserve Board have increased rates for mortgages. Budd noted that current rates for 30-year mortgages are in the 6% range. That’s near, or a bit below historic norms. But buyers had been paying around 3% for mortgage loans. That moves people either out of a market niche or out of the market altogether, Budd said.
And, Fitzgerald noted, some potential sellers are deciding to stand pat because of the cost of moving into another home.
And prices so far haven’t moved off current levels.
According to the Vail Board of Realtors data, both median and average prices increased in August. For the year to date, those increases are substantial: 23% for median prices and 20% for average prices.
But, Budd said, those figures can be somewhat misleading, given the relatively small size of the local market. For instance, he noted, the percentage of homes in the $5 million and up range has doubled in the past few years.
As the national economy continues to be uncertain, Fitzgerald said while the Vail Valley isn’t immune to national economic trends, “Vail remains very desirable for real estate — we’re the definition of a constrained market.”
But, Budd said, predicting the current state of the economy is more than difficult.
“We’re just going to have to ride through it, and see if we hit a wall or we can slide down (to a soft landing),” he said.
