Summit County's 2021 real estate market blew everyone's expectations out of the water. Summit County saw $3,053,165,389 in Residential Gross Sales Volume in 2021. Average Residential Sales Prices were up 24% from 2020. The Average Single Family Home Sales Price in 2021 was $1,717,028 and the Average Multi-Family Home Sales Price was $750,022. Vacant Land Sales Price increased 37% over 2020 with an Average Sales Price of $504,480.
The experts that we follow anticipate that nationwide, real estate sales will continue to be strong for the next 4 years. We at Nelson Walley Real Estate anticipate that strong sales will continue in Summit County for another 1-2 years after that primarily because our market tends to follow the national market by 18 months to 2 years.
With that being said, we feel there are 3 main factors that will have an impact on Summit County Real Estate sales in 2022.
Inventory!! It sounds like a music track set on repeat. "We have no inventory!" In January 2014, there were a total of 1,040 residential properties for sale. January 2022 only saw 127 properties for sale. That is an 88% decrease in 8 years. As I write this, there are currently only 77 market-rate properties available and only 26 of them are $2,000,000 or less. Recall your Economics 101 class: Supply & Demand. If demand remains strong and we are in short supply, prices will continue to rise. As a seller, this scarcity allows Nelson Walley Real Estate to extract more value for you. However, it isn't as easy as simply putting your home in the MLS. We provide you with what we like to call our "Secret Sauce" which combines both assisting you with preparing your home so it will encourage multiple offers with minimal contingencies as well as utilizing our pricing strategy which has proven to be incredibly successful. Buyers can often become discouraged in this kind of market as they see offers on multiple properties continually rejected for "a better offer". We work with buyers to educate them on the best way to submit an offer so that it will have an excellent chance of being accepted but at the same time watching out for your best interest to make sure that you do not pay too much for your large investment.
Interest Rates. There are 2 components to interest rates which will impact real estate sales in 2022. Based on the opinions of experts that we follow; we anticipate interest rates for 30-year mortgages to rise to between 3.75% - 4% by the end of the year. Keep in mind that these are still very low rates. As recently as 2019, rates were as high as 4.46%. In the early 90's rates ranged between 8-10% and in 1981 they rose as high as 18.45%. And, completely unrelated to what the Fed is doing with interest rate hikes, Fannie Mae (FNMA) and Freddie Mac (FHLMC) will be increasing their rates on 2nd home loans and high balance loans (loan amounts between $647,200 to $822,375). These loans will see an increase of at least 1% over the 30-year, primary, low-balance home loan. While these will still be historically low rates, many buyers will feel like they have missed out on the great rates of the past 2 years.
Short-Term Rental (STR) Regulations: The Town of Breckenridge and Unincorporated Summit County have finalized their new rental regulations. Breckenridge has capped the number of STR licenses that can be active to 2,200. Since there are currently over 3,000 STR licenses in the Town, it will take a few years of attrition before new homeowners will be able to obtain a license. Keep in mind that this regulation only applies to properties without a front desk. Condotels like Beaver Run and many others will not be affected by this regulation. Unincorporated Summit County (properties within the County but not within any town limit) has implemented 3 types of licensing. If the property is in a resort area (Keystone or Copper Mountain - a Type 1 license) or properties that are able to obtain a Type 3 license, there will be no limit on the number of nights you can rent out the property. However, if the property falls within the Type 2 license, then property owners can only short-term rent (less than 30 days) their property 135 nights/year. The other towns throughout the county have only just started the conversation on STR regulations - so we have yet to see how properties in Silverthorne, Frisco, Dillon, and Blue River will be affected.
As you begin to navigate the 2022 real estate market in Summit County, please reach out to us so that we can assist you! If you are a Seller, allow us to share our “Secret Sauce” with you and help you to make the most money you can on the sale of your home. If you are a buyer, there is no doubt that this can be a frustrating time. However, we would like to help you get into your mountain retreat and are here to hold your hand throughout the process.