Taking a look back over the prior 12 months reveals our Pagosa Springs area housing market has yet to stabilize. While it is true that the volume of new foreclosures has dropped way off and the percentage of foreclosure sales has also declined significantly, values have yet to shake off the long term effects of those influences. Like other areas, we have sustained some level of sales activity at the low end of the price ranges where cheap money, low down payments and government loan guarantees stimulate sales. However, the middle of our price range and the upper end have yet to rebound and gain the traction necessary to draw down inventory levels which would to stabilize and eventually appreciate home values. Our analysis based on the prior 12 months sales history from November 5th, as compared to one year earlier shows home prices have actually declined with Median Sales Prices down 7% and Average Sales Price down 5.8% year over year. The actual number of Closed Sales increased slightly while the Total Sale Volume declined slightly. These figures are not overly alarming, simply indicating a continuing sluggishness in the middle and upper price ranges.
GREAT VALUES FOR BUYERS-
For luxury custom home Buyers, Pagosa has much to offer. Presently homes priced $750,000 and above represent a fabulous buying opportunity with homes available at discounts of up to 30% compared to new construction. Even though some of these larger custom homes may be slightly outdated, $100,000-$150,000 in upgrades can do wonders and still represent a very significant savings over the cost of new construction.
While I was in Vail Valley recently attending a commercial real estate summit we toured several homes that had sold above $2,000 per square foot. They were newly updated condominiums in Vail Village which sold for nearly three times what similar sized homes in Beaver Creek were offered at. The broker explained to us that in the Vail area, luxury condo and home buyers consider a home that has not been remodeled or substantially updated in the prior five years to be totally undesirable. With the facelift the entire Vail Village has recently completed, its residences offer fresh looks with all the latest finishes and features that the high dollar visitors demand. Fortunately, our upper-end Buyers are not quite that demanding here in Southwest Colorado, but there is something to be learned from the large difference in housing values that currently exists between Vail Village and Beaver Creek. This huge spread will undoubtedly accelerate efforts to update all of the Beaver Creek area. With a margin of $1,200-$1,300 per square foot, there is a lot of incentive to update and upgrade housing within Beaver Creek.
In Southwest Colorado the difference between the cost of new custom construction and existing luxury home prices is not anywhere near as dramatic. However, a difference of 30% or more is sufficient to create some opportunities for builders and investors. As discussed in a prior blog, there are a dozen or so very high-end custom homes currently under construction in our area with several more planned for 2015- so it is evident our area is attracting some good high-end Buyers, but they are not finding what they want in the existing housing stock. Our feedback comments clearly show these Buyers would buy existing upper-end homes if they had the finishes and features they desired.
We do have a limited number of highly desirable, “big-view” homesites in our area. Older homes can be acquired and remodeled and then resold at a profit, based on where our market it today. If this is of interest, give us a call to discuss where we see opportunities. Mike Heraty 970 264-7000 Email: MikeHeraty@frontier.net
A New Association
We recently entered into a marketing engagement with the area's best custom builder, Len Ritchie and his partner, Wayne Spivey. We are listing two of their projects, one on SHOOTING STAR within Timber Ridge and the other, a magnificent lodge restoration in Majestic Mountain Estates, at the end of the Blanco Basin, (our version of
Yosemite Valley.) The Blanco Basin property, CASA RIO BLANCO is scheduled for completion around the end of the year, with over 6,500 square feet of indoor living space. The home is an exceptional presentation of rustic elegance architecture, with extensive use of reclaimed 200 year old timbers and log structures. The floors, cabinetry, doors and rockwork embody all the visuals of a hand built lodge from the 1800's. I have included two images of the project and I will post more in the next several weeks. The setting and views are equally breathtaking.
This and other fine Colorado ranches and Pagosa Springs, Colorado resort homes can be found on our Pagosa Source website at www.PagosaSource.com or call 970-264-7000 and let us help you
discover more about Pagosa Springs, Colorado.
Looking for a great bike ride for a novice? Or maybe you are an advanced rider with a sense of adventure. Whether you are a rider, runner, hiker, walker The Pagosa Trails website has every map you need - beginner to expert to get out on the trail.