Lee’s Pagosa Springs Real Estate Newsletter, February 2012
So far, so good. 2012 is starting off very well. The weather has been great – lots of sun, warm temps for January, and twice as much snow on the mountain as any other ski area around. 23 inches up there in the past couple of days. I know we need a lot more before winter is over. Currently, snow pack is at 78% of average.
Even though slower than everyone would like, the economy is getting better. The jobs situation seems to be improving, as unemployment has fallen to 8.3%. The stock market has started off strong. The local real estate market is also doing better. Home sales are up 30%, vacant land sales are up 450%, and overall sales are up 86% compared to the same time last year. The other big surprise is the reduction in inventory. Home inventory is down 19% from last year and even further from 2010. We now have 314 homes on the market versus 431 two years ago. Condo inventory is down to 59 versus 78 a year ago and 107 in 2010. The repo inventory is also declining. I also checked the pending sales, and there are 49 total properties in the hopper. These are all good signs that we are on our way to recovery. Of course, this is just one month of numbers. It doesn’t take much to distort the percentages because of the small sample size.
One factor driving land sales is pricing. There are some bargain-basement deals out there, and people are starting to take advantage of them in order to purchase the lot next door to their house or preserve their mountain views. In 2006 at the peak of the market, the median quarter-acre lot in Pagosa Lakes sold for $50,000. In 2011, it was $12,500. In 2006, five-acre lots with central water went for $160,000. Today it’s $60,000. And finally, a 35-acre parcel was worth $239,000 at the peak. Today the median is $137,000. It could be that low prices are starting to spur an upswing in vacant land sales, but we only have one month of data, so right now it’s hard to tell.
Interest rates are still below 4% for a 30-year fixed. Consumer confidence is a little better. I know I’m feeling better.
Now for local politics. Walmart is what everyone is talking about. I was on the Big Box committee a couple of years ago. I spent about 12 months going to meetings. It seems like the community is pretty equally divided. I can take it or leave it.