As we enter the second half of the year, there is both statistical and anecdotal evidence that we are starting to see some signs of a ânormalâ historical market. While headlines will reflect the strength of the first and second quarters compared to a year ago – the Eagle County market is up about 75% of closed sales from the first half of 2020 and has doubled in dollar volume – we are seeing an increase in inventory entering the market.
This is a factor that can help the market achieve a better balance between buyers and sellers. The summer months have also proven to attract more buyers and current demand remains very strong, both in terms of activity and attendance at the open houses.
There are a few factors pointing to potential subtle changes:
For the first time in at least 14 years, inventory levels from June to September 2020 were stable or declined from our historic increase in inventory during the critical months from late spring to summer. To kick off our summer season, we’re starting to see the pace of new listings exceeding the rate they’re contracted for – building our inventory and bringing the market back to its more historic model.
Pending sales are lower than they were a year ago at this time and have declined steadily since late April – this is normally a time when they are flat or pending sales start to increase – with a peak around mid-August. As inventory increases, pending sales will also increase, given the strong demand from buyers.
Our market dynamics are unique, and the following market summaries provide more detail for luxury / resort and Down Valley buyers and sellers.
Luxury and resort market
Comprised of Vail, Beaver Creek, Arrowhead, Singletree and Cordillera, Berkshire Hathaway HomeServices Colorado Properties broker, Adam Bartlett, offers the following information to buyers and sellers.
Buyers: While there are encouraging signs that last year’s buying frenzy is slowing down slightly, buyers have yet to prepare with a solid supply. They should also be careful when considering making offers that are below market value and / or have too many contingencies. It’s still a sellers’ market, and properly priced homes always move quickly.
Another important consideration on pricing is the location; both for single family / duplex and condos. Homes and units in more desirable locations and with views will generally be more expensive. If you’re willing to be flexible, you can usually get a lower price. But also make sure you’re getting what you pay for, including geographic location or in a building, especially if a price is higher than you expect or what the market says is fair value.
Sellers: Buyers are warned due to access to Zillow and other online platforms that show fair market value for homes and sellers must be market sensitive when it comes to price. The big leaps in appreciation we’ve seen over the past year show some slowing down as buyers begin to settle into post-COVID ânormalâ. It involves considering whether they really need new or additional housing, how long they will be working remotely, and how much they are willing to spend / invest on a property.
We’re also seeing a trend with buyers now trying to hire overpriced sellers and bid. In the past, if a home was priced too high, buyers wouldn’t even bid. Sellers who are serious about selling should make sure they are in tune with the current market and working with an experienced broker can help them price and get the best deal for their home.
Comprised of three communities including Eagle, Eagle Ranch and Gypsum, the Eagle County Downvalley Market offers more affordable prices for the size of the home as well as a temperate four-season climate, which adds to its appeal to local people. buyers. Renee Oleson, Associate Broker for Berkshire Hathaway HomeServices Colorado Properties, provides an overview of the Downvalley market.
Sellers: Now is a great time to sell and capitalize on market increases and growing interest in the Downvalley market. The area is no longer a secret inside, and many out-of-town shoppers view homes and the area as undervalued compared to other communities closer to resort areas. With high buyer demand and low inventory levels, many buyers bid above the list price with little or no unforeseen events. With many shoppers now able to work remotely and coming from more congested urban and suburban areas, a 30-minute drive from world-class ski resorts, a more moderate all-season climate and a regional airport within 10 minutes, brings added value to their offers.
Sellers should always list their property based on fair market value, which will attract more buyers and potentially lead to multiple offers. Sellers should be prepared to close quickly or negotiate closing conditions if they have no other accommodation to move into. This is where working with an experienced broker can really help – from pricing to helping find a replacement home while handling the details of the negotiation and closing.
Buyers: As homeowners hear about their neighbors selling their homes at record highs with multiple offers, they are increasingly motivated to take advantage of market price increases. This increase in inventory helps to balance the market which has been saturated with eager buyers. The restraint of many sellers has always been the fear of not finding a replacement home.
With an anticipated increase in inventory appearing to be taking place, sellers’ worries are likely to subside and help bring more inventory to buyers. Many homes are still sold before they reach MLS, so working with a knowledgeable broker who has the contacts and established relationships to know when homes hit the market puts the buyer – and a seller looking to buy – in a real world. more strategic position to get an accepted offer. Buyers need to prepare with pre-approvals and flexible options, including having to make more than one offer before theirs is accepted.
For trends and additional market information including Berkshire Hathaway HomeServices Colorado Properties offices, brokers and listings, visit BHHSColoradoProperties.com or call 970-329-2482.
Michael Slevin is the President of Berkshire Hathaway HomeServices Colorado Properties.