From the Vail Daily:
The county’s real estate market is something of a mixed bag this year. Total sales are up, but average sale prices are down. But one sector of the market is keeping brokers and mortgage bankers hoping.
“If you’re selling a home for $300,000 or less, you’re going to get multiple offers,” Prudential Colorado Properties broker Mallie Kingston said.
Kingston said the activity in the lower end of the market is driven by several factors, but the most important is as old as Adam Smith: There’s a lot of demand and not much supply.
As a result, prices on the lower end of the for-sale market have started to show more strength, Kingston said.
Julie Bergsten, a vice president at Slifer Smith & Frampton Real Estate, said the multiple-offer syndrome may stretch a bit farther up-market. She said she’s seeing homes priced at $500,000 or less attracting a lot of attention, too.
Most of the sales in the county have historically been for $500,000 or less, with a few sales of high-end properties building up the average prices. That was the case in March, according to the most recent data from Land Title Guarantee Co.
Almost half of the 120 sales in March were for $500,000 or less, according to the monthly report. Adding homes of $1 million or less to the mix brings the total to 75 percent of all transactions.
But, Bergsten said, buyers of very expensive homes are “on the sidelines” right now. According to Slifer Smith & Frampton’s data, the company recorded 22 “written deals” for property priced at $3 million or more in the first quarter of 2012. In the first quarter of this year, only eight such deals were made.
But there’s no lack of buyers in the lower end of the market. Sarah Jardis, president of Central Rockies Mortgage, said she’s seeing a number of first-time buyers, including nurses, teachers and other young professionals. Those people are taking advantage of historically low interest rates. And, at least for some buyers, programs are available to loan 100 percent of a home’s purchase price.
Unlike the go-go days in the middle of the last decade, though, borrowers have to do more than register a pulse.
“There’s maybe more paperwork than ever before,” Jardis said. “If (a lender) asks for a bank statement, they want every page.”
Still, deals are getting done, Jardis said.
Bergsten said the current lack of inventory has the market in a kind of nether zone that’s neither a buyer’s nor seller’s market.
“Neither side is really in the driver’s seat right now,” Bergsten said. But, she added, sellers — especially those who don’t have to sell — may be feeling a bit more confident right now, and might be more willing to wait for what they consider an appropriate offer. And Kingston said this is a good time to sell, for people who still have equity in their homes.
Still, the market is nowhere near the rapid upward spiral it was on between 2005 and early 2008, and Bergsten said “I don’t see things exploding any time soon.”
With inventory so low, both Kingston and Bergsten said it might be time to build some new homes — at the right price point.