Market: Things are getting better
Coronavirus has been a challenge everywhere, including Steamboat Springs. It seems only Montana and other rural states have been spared pain that many of us have been working with for over two months. For real estate, now that some time has gone by, understanding trends is more discernible now.
In past blogs, I talked about a maximum of 10-14% drop in market value. That looks like up to 5% today. Except for the great recession, real estate values have dropped minimally during stressful times like now. In fact, this week Zillow announced it thinks the bottom in real estate has occurred.
My biggest conundrum in considering where things are going is what is going to happen over the next year. Are folks going back to work? Will people travel? Travel far? From The Hustle, this is what they offer:
It’s a mixed bag. Even with some people braving travel and restaurants, the number of people spending is going to be down. This being said, one statistic that impressed some economists is that household savings rates increased 13%. Impressed is the wrong word. Surprise is the better term. This to me indicates that families have again evaluated what is important to them and have made choices relating to this.
I don’t know what is going to happen and I expect many economists and brokers to change their minds consistently, at least through June.
Sales trends for Colorado Group Realty are better than most brokerages. We have been executing contracts and working with the community to support local non-profits. We are seeing those who have to move making the most transactions. Otherwise, many people are waiting to see what happens over the next months. New listings are being valued at February prices. (This is curious to me. It doesn’t make sense. It seems the properties getting the most attention are not second homes. And those properties priced at the top end of price per square foot value are slow to show.)
For this Summer, I have seen many owners lower their expectations with rental income. Smart landlords are being aggressive to get tenants. Some are holding and seeing if things change back to old normal, and if the resort will open this Winter. Irrespective, if the resort does not open this Summer, there will be few travelers or employees who are looking for places to stay.