There have been a lot of shifts in the housing market recently. Mortgage rates rose dramatically last year, impacting many people’s ability to buy a home. Breckenridge, Silverthorne, Frisco, and unincorporated Summit County (i.e., the areas of Summit County which sit outside of a town’s limits and are thus governed by County Commissioners instead of by a town’s council members) implemented new short-term rental (“STR”) regulations limiting the number of STR licenses that can be issued. And after several years of rapid price appreciation, home prices finally peaked in the first quarter of 2023 in Summit County. These changes led many to believe that Summit County home prices would crash. But that is not happening.
Even though we’re no longer seeing the buyer frenzy that drove home values up during the pandemic, prices have been relatively flat at the national level. Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), doesn’t expect that to change:
“[H]ome prices will be steady in most parts of the country with a minor change in the national median home price.”
You might think sellers would have to lower prices to attract buyers in today’s market, and that’s part of why some may have been waiting for prices to come crashing down. But there’s another factor at play – low inventory. And according to Yun, that’s limiting just how low prices will go:
“We simply don’t have enough inventory. Will some markets see a price decline? Yes. [But] with the supply not being there, the repeat of a 30 percent price decline is highly, highly unlikely.”
The graph below show the Months Supply of Residential Properties in Summit County (Excludes vacant land and time shares)
That lack of available homes on the market is putting upward pressure on prices. Bankrate puts it like this:
“This ongoing lack of inventory explains why many buyers still have little choice but to bid up prices. And it also indicates that the supply-and-demand equation simply won’t allow a price crash in the near future.”
If more homes don’t come to the market, a lack of supply will keep prices from crashing, and, according to industry expert Rick Sharga, inventory isn’t likely to rise significantly this year:
“I believe that we’re likely to see low inventory continue to vex the housing market throughout 2023.”
In Summit County, Colorado, we are seeing a shift in prices in some areas. The STR regulations are having a big impact on prices, especially in locations like Wildernest. While prices aren’t crashing in Wildernest, they are certainly dropping significantly. However, homes in the $1M and over price range are staying strong.
Are you a Summit County property owner and are you wondering what the value of your home is right now?Call us and we can prepare a detailed Comparative Market Analysis for you so that you know the value of one of your biggest assets. And if you considering entering the Summit County real estate market for the first time, we can help you find the property that is just right fit, and our expert team will help guide you through the entire process all while negotiating the best price for you.