Window shoppers give Realtors hope

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Sales Activity (past 12 months) and Listing Activity in Steamboat Springs and south valley

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Months of Inventory in Steamboat Springs and south valley

— If the entire Steamboat Springs real estate market were viewed as a single, large-format retail store, local Realtors say things are looking up. The reason: Even if customers aren’t buying like they were a couple years ago, at least they’re coming through the door again.

And in contrast to this time a year ago, the shopkeepers are more confident about putting prices on the merchandise.

“I’m not as worried as I was a year ago, when there was no rule book,” said David Baldinger Jr., of Steamboat Village Brokers. “A year ago, we had record inventory, prices hadn’t come down at all, and sellers were very stubborn about that, even when they had to sell.

“Now at least people are shopping. If the whole real estate market is a store, there are customers in the store.”

A year ago, Baldinger said, the local market was operating on more of a barter system than ever, as sellers and their agents struggled to put a price tag on the merchandise that would match falling demand and increasing inventory.

Baldinger said all of the measuring sticks he has to track buyer interest look positive and that he has heard the same things from his peers at Prudential Steamboat Realty and Colorado Group Realty.

“Our phone calls, Web traffic and showings are all up,” he said.

Pam Vanatta, co-owner of Prudential Steamboat Realty, agrees that the number of people looking at property in the market is on the up-tick. She also thinks that among buyers who are actively looking at property, there is a growing awareness that they’ve missed out on opportunities in the Steamboat market and those opportunities may not exist beyond mid-2010.

“In the fourth quarter, we’re starting to see a little recovery compared to the first three quarters of 2009,” Vanatta said.

Vanatta cites the micro-market on Golf View Way in the Sanctuary neighborhood, where two homes sold earlier this fall, as an example of lost opportunities. She has direct knowledge, she said, that several other buyers were looking seriously at the two homes that sold.

“Buyers have an opportunity for the next six months — prices are very good right now. But in some cases, people have liked a specific property and someone else has jumped on it,” Vanatta said.

Square-foot pricing

The two sales in the Sanct­uary this fall reflect a low point in recent years for sales in the luxury subdivision on a per-square-foot basis. At the same time, Vanatta thinks she recognizes the beginning of a rebound in that market segment.

The first house, at 2248 Golf View, sold Sept. 30 for $1.6 million. The 4,361-square-foot home has four bedrooms, five baths and a three-car garage. The selling price worked out to $367 per square foot.

Homes in the Sanctuary had been selling at prices above $400 per square foot for several years, Vanatta said.

The second sale, on Oct. 29, also came in below $400 per square foot, she said, but this time, the home at 2276 Golf View was about 5 percent more per square foot than the preceding sale.

The 5,137-square-foot home was built in 2006 and has four bedrooms and 4.5 baths. The sale price was $2 million, or $389 a square foot.

A third sale is pending in the Sanctuary, Vanatta said, and when it closes, the sale price will notch another 5 percent increment over the Oct. 29 price.

Supply and demand

The two Sanctuary homes were priced in a market niche where there were 29 listings on the market and there had been five sales in the 12 months preceding Nov. 1, according to research by Realtor Doug Labor, of Buyer’s Resource Real Estate. Labor is the official statistician for the Steamboat Springs Board of Realtors. His research considered only listings within the city limits of Steamboat Springs and the south valley, excluding North Routt, for example.

Labor’s research concludes that if the absorption rate going forward did not improve during the past 12 months, it would theoretically take 70 months for the market to absorb those 29 properties.

However, the supply is even greater for homes listed between $1 million and $1.5 million. Labor said there are 48 listings in that price point, with five sales in the preceding 12 months. That works out to a 115-month supply.

Baldinger said he does not place any emphasis on the calculated supply because in his experience it’s almost unheard of for absorption rates to remain stagnant for such an extended period.

However, after just two sales during a period of 12 months in the price point between $2 million and $3 million, the 28 listings represent a supply of 168 months at the prevailing absorption rate, Labor said.

Motivated sellers willing to price their property at a discount of 15 to 20 percent from the original asking price have set the market this fall because that’s the pricing shoppers are responding to, Baldinger said.

He expects to see sales trends grow gradually as those shoppers adjust their thinking.

There will be shoppers in the real estate store during the holidays as vacationers arrive in large numbers, but the people who are most serious about Steamboat seemed to also have learned to come in February and March when the snow is the most reliable, Baldinger said.

“That’s the activity that turns into sales in early summer,” he added.

The sale process is taking longer now than in the recent past when buyers could expect to put down 20 percent, sign the paperwork and close within six weeks.

Now, vacationers shopping for resort condominiums are discovering that they need to bring a 40 percent down payment, which in turn could cause them to revise their expectations or rethink the idea of buying.

“We’re starting all over, brick by brick,” Baldiner said. “Over months and years, we’ll see growing sales volume and growing confidence in the values placed on properties."

Comments

Scott Wedel 4 years, 11 months ago

Newsflash - Sunrise Give Realtors Hope SB - Local realtors expressed hope after the sun rose today. Despite price declines of about 33% and number of sales declining by 75%, local realtors expressed hope after the sun rose today. "The fact that the sun rose today proves that the world did not end last night" said local realtor Mindless Promoter, "that results in a much stronger market than if the world had been destroyed by Planet X last night".

"A property sold and I just know that if those people had not purchased it for 35% less than what it sold for two years that other people would have purchased it" said local realtor Polly Anna. She says "Just because there are dozens of similar properties with similar price declines still on the market does not mean there were not lots of buyers standing in line for the properties that did sell". She concludes "So anyone thinking of buying needs to buy now before every property they like is sold."

Local Realtor Mr Ignorance S Bliss said that the because he cannot remember the local real estate market having prices down so much and still being so slow that it is now "due" for a "home run" month.

They noted in unison that "if it's Fall then we have Christmas shoppers, if it's Winter then we have skier visitors, if it's Spring then we have prime buying season, and if it's Summer then we have summer tourists".

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Scott Wedel 4 years, 11 months ago

Though, I should congrat the article for containing these charts. This is the data that truly reflects the current state of a real estate market whether it be good or bad.

Though, the listing charts seems odd. It says there are no single family homes listed for less than $250K and that the chart covers "SB and south valley". So apparently "south valley" does not include Stagecoach, Oak Creek or further south. The area covered by the charts needs to be disclosed.

And maybe next week the charts will be for the entire county.

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Scott Wedel 4 years, 11 months ago

I had a realtor call me this evening and we had a long interesting discussion. We agreed that real estate prices are down 35%-40% from the peak and that number of transactions declined about 80% earlier this year, recovered to down like 70%, and the realtor has hopes that it might recover to down 60%.

And if anything like that had been mentioned in the article, that comments of optimism were tempered with realistic comments of where we are then my satirical comment would not have made sense.

But the opening sentence denies a realistic sense of the current situation. If SB real estate was viewed as a single large-format retail store then it would be in bankruptcy. (Tell me a retail store that survives an 80% drop in sales and 40% drop in prices). The second sentence could be "But local realtors see signs that it could be avoid being liquidated and instead be reorganized and emerge from bankruptcy."

And maybe realtors see comments of "no rule book" and "operating as a barter system" as indicating things are as bad as if Planet X had hit the earth. And talking about sellers needing to reduce prices might mean to realtors that properties that had been aggressively priced to sell are now overpriced and need to come down 25% to have a chance. When I see "no rule book" and "barter system" I think of the new rules of trying to finance, especially for condos. And when I see "reduce prices", I think of all the properties that were overpriced and did not sell during the boom. I think there are good number of properties listed that could halve the asking price and still not sell.

And my little bit of satire was not meant as taking shots of the particular realtors quoted in this article. It was a shot at all of the comments for the past 10 months from all the quoted realtors in the Sunday Real Estate section of how things are getting better month by month and the consistent message of "act now before the deals are gone".

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