Cheap homes hard to find

Sub-$500K market shrinking quickly

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— Properties priced below $500,000 in Routt County still account for a large chunk of transaction volume. However, the supply is drying up, and the monthly number of sales of properties less than a half-million dollars has declined by 32 percent since the first quarter of 2007.

Mirroring that trend, the dollar volume generated by sales below $500,000 is declining sharply in terms of percent of gross dollar volume in the county. And the gap between costly and cheaper real estate sales is widening with the growing number of sales greater than $3 million.

Bruce Carta of Land Title Guarantee Co. reported that six transactions valued at more than $3 million closed in September, bringing the year-to-date total to 23. Those six properties had an aggregate gross dollar volume of $22.6 million, or 24 percent of the month's total of $94.9 million.

Also in September, sales of all properties valued at less than $500,000 accounted for 57 transactions. They had an aggregate value of 17.73 million, or 18 percent of the Routt County total for the month.

The entry-level numbers are down from July, when 77 transactions accounted for $24.8 million and 22 percent of gross dollar volume.

Sub-$500,000 transactions totaled 84 in March and represented 30 percent of gross dollar volumes.

Realtor Jon Wade, a broker owner at Colorado Group Realty, said he thinks city ordinances requiring developers of new housing projects to provide affordable units are playing a role in the trend.

Wade said earlier this year, there was an awareness growing in the marketplace that modestly priced multi-family housing units - such as those in the Whistler Road neighborhood - never would be replicated at comparable prices. That awareness prompted buyers to take action, and prices responded.

The need for market-rate units to subsidize the affordable units contributes to higher prices, he said.

"It makes it really hard for the middle class to get market-rate affordable units," Wade said. "I want my friends to be able to get affordable housing. But I think there are ways to do it that doesn't drive up the price."

Comments

rodcarew 7 years ago

I think that it's sheer fallacy to blame the requirement of affordable housing on the rise in housing costs. At most, it is a small percentage. The vast rise in the raw land costs, driven by the scarcity of developable land and speculation resulting from the new ski area owner, as well as increased constructions costs are the prime reason the skyrocketing housing costs. No one is going to build moderately priced multi family housing anymore for precisely these reasons. Jon and others want to try and kill the landmark affordable housing ordinance-the most important piece of legislation in Steamboat history because they thinks there's a better way-yet they never offer up a beter solution. Or any solution for that matter.

I do agree that the middle class is quickly being left out in the cold-because they fall between market rate and affordable housing and that we should eventually target affordable and attainable housing for that group, but the 120% AMI and less crowd is getting squeezed out the fastest. The middle class still has options around Routt County.

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rodcarew 7 years ago

the condo guy: you actually think there's "balance" under the current situation? I don't see the "market" building too many affordable housing units of their own volition. Some of the wealthy might not care now, but they might start caring when they're driving to Craig to get their car fixed or when no one shows up to their house when they call 911.

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id04sp 7 years ago

Land cost is the biggest factor. Nobody is going to build a sub-market spec house on a market rate lot. Makes no sense from a business standpoint.

The difference between the cost of the "affordable" units and the market rate is simply being rolled into the price of the market rate units. Nobody is going to give away his ability to make a living in order to give a gift to someone who hasn't worked as hard and taken a comparable risk. What next? A hug when somebody moves into an affordable house?

Prices won't even level off until market rate spec houses start sitting around unsold for six months. That's when you'll know the market has reached its limit.

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thecondoguy1 7 years ago

we ain't seen nothin yet, when the do good liberal bunch thinks they can cercumvent the market forces to get a few brotheren beholdin to them, there goes the balance, people who do not think the cost of affordable housing is not spread around are crazy, the middle class will pay and pay dearly, the wealthy could care less.............

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thecondoguy1 7 years ago

the market will provide for car repairs and emergency personel either way, there is no free ride, sorry, if we don't pay the cops, and auto repair folks, we pay for their homes, hence the increase in the value of all housing, it's a vicious circle, there is no such thing as a "cheap" home, we all pay, and the stress is transfered to the middle class. the entry level folks and the wealthy will be just fine. P.S. have you had your car repaired in stmbt lately? repairs are double the rate in Craig............

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