La Plata County Quarterly Real Estate Update
Welcome, February!
I love sharing our year’s final analysis, because it’s the time of year when we have enough data to see how the market performed. La Plata County has many dynamics in play, some of which mirror other areas in the country.
Overall, the number of sales was significantly down from 2022. Single-family sales were -19% fewer, and condos/townhomes -27%. This is partly because there were fewer homes on the market (same categories, -14%/-12% respectively) and people bought less of the homes that were on the market. Though it feels as though inventory is climbing because we see homes stay on the market a little longer (speaking insignificantly statistically), we only have thirteen more homes on the market than we did last year at the same time!
As you’ve undoubtedly heard, the interest rates were particularly high in 2023, causing many buyers to stay on the sidelines to try to wait it out. Others weren’t willing to give up their current home’s 3% rate to move, and even if they were, many sellers wouldn’t have taken a contingent offer. The National Realtor Association, NAR, calls this a “lock-in effect”. Too little inventory for demand has pushed prices a bit higher, but it’s a steady climb or plateau for most; median price changes range from +3% in-town Durango, +6% in Bayfield and rural Durango, to -3% in rural Bayfield. The resort area median is still climbing, with median prices rising another whopping +27 % for single-family homes and +19% for condos and townhomes. The trajectory of the climbing prices in the county (other than the resort) is more stable but not sustainable for buyers since it can’t undo the skyrocketed pricing and decreasing affordability created over the past few years.
Another dynamic in our local market is that not everyone is rate-dependent; 40% of our sales were to cash buyers. While it felt earlier this year there was growing buyer hesitancy, it wasn’t enough to change what we see in the numbers-strong demand and little supply.
What is in store for 2024? We hope rates continue to drop, loosen up inventory, and stabilize prices further. Chief Economist Lawrence Yun of NAR recently stated, “Mortgage rates are meaningfully lower compared to just two months ago, and more inventory is expected to appear on the market in the upcoming months.” It is an election year, which can slow things up for a few months in the fall but doesn’t have a lasting effect regardless of election results.
I do want to touch on the ongoing antitrust class-action lawsuits with the National Association of Realtors as I’m fielding questions from many who are looking to enter the market this year. While one court case was settled and another has been ruled on, we are waiting for injunctive relief which will be what sets the stage for our practice to change as an industry. I foresee fewer changes in Colorado than in many areas in our country because we have Buyer Agency, but we will eventually see changes in practice occurring. There are many pending cases as well in the courts. I can talk in more detail as the year progresses and as changes go into effect.
Please feel free to contact us with any questions. Statistics linked HERE
Heather Erb Owner & Broker