Steamboat Springs In the boom and bust boogie of the construction world, Steamboat is still adjusting to a change in tempo.
Construction value dropped 18 percent in 2002 and first-quarter numbers for 2003 continued to decline by19 percent.
At the end of 2002, Routt County's total construction valuation, $99 million, was the lowest total since 1997, the eve of the late '90s construction boom, which saw the expansion of the Sheraton and building of the Steamboat Grand Resort Hotel and Yampa Valley Medical Center.
For more than a year, Routt County Chief Building Officer Mark Marchus has been saying the construction market is still in the declining phase as it moves toward levels that were normal before the dramatic peaks started four years ago.
The first three months of 2003 saw $10.4 million worth of construction value.
And May, which marks the start of the busy construction season, had $28 million in construction value, down slightly from $34 million the year before.
Construction is likely to pick up this summer with the revamping of Sundance Plaza and the start of work on the luxury 23-unit, six-story Chadwick project at the base of the ski area. Also, homes in the West End Village Project are now being built. Half of the 88 units planned for the project are deed-restricted affordable housing units.
Although construction values dropped in the city in 2002, construction valuation increased in the rest of Routt County by 17 percent to $59.9 million.
Construction values could have dropped much lower in 2002. Marchus has said historically low mortgage interest rates combined with the availability of builders and lots remaining in Silver Spur, Heritage Park and two new subdivisions in Hayden to keep numbers higher than expected.
Marchus predicts that by the end of the year, the county should see about 200 single-family homes go up, close to the 2002 number.
Single-family homes reached a 10-year low for Steamboat in 2002 with just 40 built. But the rest of the county saw a increase in construction value for single-family homes. With 134 homes built, the number of homes was just a 2 percent decrease from the year before.
After looking at the 2002 numbers in January, Board of Realtors President Randall Hannaway said the numbers indicated that Steamboat remained in an absorption cycle. Because developers often continue to build after the market slows, Steamboat has been left with an excess inventory for single-family homes, condos and commercial buildings.
The 2002 numbers may be a sign that the real estate market is about to turn around and begin an upswing, Hannaway said. Building permits often represent the builder's psychological cycle and are a step behind what the market is actually doing.
"When you see the building permits bottom out, (the market) is already on the way up," Hannaway said. "How long it takes to go from absorption to peak, that is what we don't know. It could be four or 12 years."