Roaring Fork Valley Real Estate Market Update - March 2020
To all,
With so much upheaval going on right now, there are a lot of concerns, questions and worries about the real estate market in the Roaring Fork Valley. While I don’t have all of the answers, I thought I would share experiences I have had so far and what the broker community is currently talking about.
Timing wise, it is hard to predict how long and to what extend the economic repercussions from the COVID-19 virus will be. We are all seeing the effects globally, and personally. A close family member lost her job on Monday. She was Director at a local, corporate company and will be jobless as of next week. I personally was graced with shingles last week and have been coping with that, officially quarantined at my house for 6 days now. While I can’t say it was brought on by the stress of the pandemic, it certainly was an wake up call to reevaluate the level of stress I had been enduring prior to all of this. I especially have welcomed the opportunity for a sabbatical of sorts to rest, lean on my family and work on home projects. I am appreciating the revival and elegance of cloth napkins at the dinner table and have big plans to make a homemade lasagna for the first time in years.
Pitkin County issued a strong public health order last night limiting local activities to only those for essential business. Visitors and second-home owners have also been ask to to leave. This is likely to further dampen real estate activity in Pitkin County in the short term; I am keeping my eye on Eagle and Garfield County notices in case they follow suit.
REAL ESTATE ACTIVITY.
Overall, real estate response to the COVID-19 pandemic in the Roaring Fork Valley has been two-fold: the primary homeowner market down valley has slowed, but new listings and showings are still trickling in. We believe this is attributed to low interest rates and the fact that many primary homeowners have no choice but to buy or sell right now, regardless of what is going on. The secondary/luxury real estate market has slowed far more drastically due to concerns about the economy and stock market, generating a pause on discretionary spending, much like what we saw in Aspen and Snowmass in 2016 during the last election year.
Brokers are reporting a relatively high contract termination rate, especially up in Aspen and Snowmass, but are also saying that those buyers are not completely exiting the scene, they just want to be conservative and wait. Those brokers are hopeful that those contracts will resurface later this year.
Here are some statistics pertaining to Basalt, Carbondale and Missouri Heights:
17 homes have gone under contract since March 1st, ranging from $459,000 to $2,995,000. 14 homes have sold in these areas since March 1st . To compare, 24 homes in those areas sold or went under contract in March 2019. Statistically, March 2020 has had stronger sales and pending contracts than last year, likely the result of the strong market leading up to it. It will be interesting, however, to see how April and May fare.
Last year, in March 2019, zero homes fell out of contract; so far this year, between March 1st and March 24th, we have seen 9 contracts terminate. Overall, however, there are still 70 pending contracts in Basalt, Carbondale and Missouri Heights, ranging from a $110,000 mobile home to a $9,950,000 fly fishing property on the Frying Pan. Currently, that attributes to an 11% fall out rate. While that is a significant number, it is certainly not an overwhelming majority. Again, we’ll see how the next couple of months fare.
Source: Aspen Glenwood MLS
SHOWINGS & OPEN HOUSES.
Showings in the area have definitely slowed down. I haven’t had a showing at any of my listings for 2 weeks now; I think that has been the same for many other brokers, especially those in Aspen or Snowmass. By the same token, however, I showed buyers 2 homes in South Glenwood last week. I showed different buyers 6 homes in one day in Aspen Glen and River Valley Ranch the week before. I have heard that brokers are still showing properties, but experiencing some reservations or refusals from sellers, understandably.
Showings at vacant and empty homes are proving to be effective and still somewhat active. Buyers and sellers are being asked to assess the risks involved for themselves and any occupying homeowners or tenants. Some sellers are still willing to accept showings; the broker community is doing our best to encourage and demonstrate respectful social distancing and sanitizing practices. Brokers are wiping down door knobs and counter tops and buyers are being asked to keep their hands in their pockets and not touch anything. Brokers are also letting buyers drive themselves to and from showings, to keep close contact at a minimum. Listing brokers are waiting outside. We are also being encouraged to have sensitive conversations with buyers about whether or not they have had any symptoms and encouraging people to wait to see a home if that is appropriate.
Open houses and broker caravans have also come to a halt, understandably.
INTEREST RATES.
As many of you know, interest rates for the past year have been considerably low and have dipped even lower in the past month or two. Last year, the average 30 year fixed interest rate was 4.15%, as of today it is 3.44%. On March 2nd, it dipped as low as 3.13%. Here is a graph from Mortgage News Daily for the past 20 days:
If you are considering a refinance or home purchase, I highly suggest reaching out to your lender and mortgage companies for more information. If you need any local recommendations, please let me know!
RISE IN ONLINE & INTERACTIVE MARKETING.
At an all company video conference call yesterday afternoon, it was reported that there has been a significant rise in online property views on real estate websites, like Zillow and SothebysRealty.com.
3D virtual tours and virtual reality have also surge in activity and interest, as they allow buyers to tour a home from anywhere in the world. Property videos that have long been en vogue are also proving to be helpful. 3D tours, such as Matterport and Spinnatic, allow a buyer to take themselves on a tour of a home by clicking and dragging on a digital screen to move from room to room. In my next newsletter, I will provide some resources on how to operate 3D tours.
My brokerage firm, Aspen Snowmass Sotheby’s International Realty, is hosting virtual open houses now on Monday, Wednesday and Fridays via Facebook Live. The listing broker will be at the house and will provide short tours of the home via their phone. I plan to reach out to my sellers week to discuss some of these opportunities; I know that many other brokers will be doing the same.
REMOTE CLOSINGS.
At a closing I have scheduled next week, Land Title has asked buyers and sellers to close at different times to avoid unnecessary contact. Several local Title Companies are offering remote closings in which the closer/notory comes to your place of choosing, such as your home or business, so that you don’t have to go into an office. Per an email announcement on Monday, the Colorado Association of Realtors (CAR) has requested an 90 day Executive Order to allow for the use of remote notarization (“eNotary”) technology in real estate closings. In this case, a live video could satisfy the requirement for in-person appearance during notary signing.
CONSIDERATIONS FOR BUYERS.
Low interest rates are still providing a great opportunity to purchase a home with significantly more buying power. Myself and many other brokers are offering creative ways to show homes safely and remotely. I am more than happy to preview you a home for you or do a FaceTime tour while I am there. Listing brokers may also be happy to do that for us as well. If anything looks interesting, please let me know and we’ll explore our options.
CONSIDERATIONS FOR SELLERS.
Realistically, it’s reasonable to expect a drop in showing activity in the short term, the next 2 – 6 weeks. In the event that we are fortunate to have any interests or showings in the coming weeks, I’ll let you know immediately and we’ll assess if and how you want to accommodate. My hope is that things will return to normal sometime this summer and we’ll see a resurgence of activity. In the interim, I will be in touch regularly to discuss your needs and where you’re at. Stay positive! Not all buyers have retreated to the sidelines.
WHAT OTHER BROKERS ARE SAYING.
“If there’s a silver lining here it’s that hopefully we will get past the primary COVID-19 issues by July/August, that’s the next time period I would expect/hope to see meaningful showings and real estate activity in Aspen. While we have lost the winter/spring selling season at this point, and there will be some serious drops in Aspen real estate sales over the coming months as a result, the best we can hope for is a nice rebound this summer.” - Andrew Ernemann, Aspen Snowmass Sotheby’s International Realty, Aspen, CO
“Even if this pandemic sends us into a recession, home sales may slow, but attractive interest rates, the need for housing and cash rich investors, could bolster the real estate market. COVID-19 is a specific event with a specific life span. It is not the housing crisis of 2008…” - Donna Burns, Kaiser Sotheby’s International Realty, Orange Beach, AL
My personal goal is to consider all the ways in which I can adapt my business to be of better service to my clients and to be a voice, at the very least, among my clients, family and friends. Please share this newsletter with anyone else you think might be interested! And each out if you have any questions or concerns. I look forward to providing another update in the coming weeks.
My best wishes to you and your family. Stay healthy,
Sara