REAL ESTATE NEWS
The Battle Over Affordable Housing in The Mountains
In contrast with the scenic backdrop of Telluride, a brawl is brewing between local homeowners and San Miguel County. A judge recently ruled in favor of the locals and rejected re-zoning 39 acres of land for the “Diamond Ridge” project. Developers working with the county are aiming to build a “Community Housing Zone District”, 780 housing units, in an effort to provide affordable housing for working families in the area… sounds great right?
Well, not according to these particular locals. Aside from obstructing their mountain views and crowding their neighborhood, they also feel that the plan was not well thought out. Plus, they were sold lots on top of this Mesa with promises that any new construction would made into separate, single-family housing, per the existing zoning. One local homeowner had this to say:
“We’ve just been very frustrated in a process that is all upside down. They did it so quickly, buying it for a bunch of money without any development plan or sketches or even a rough idea on the cost of water and sewer upgrades up here. They set it up like it was a done deal and we couldn’t say anything about it.”
The county recently appealed the court’s decision, so this is far from over. In their eyes, affordable housing is key to the growth of their local economy.
This type of clash is not uncommon lately in Colorado. Since the pandemic set in and people could more easily work from home, affluent buyers flocked to the mountains and resorts in droves to be closer to skiing, climbing, and all the great outdoors that Colorado has to offer. One of the problems with that is that due in-part to the latest influx of buyers, home prices were driven up by as much as 56% in some areas. This made them unaffordable for the teachers, nurses, police, firefighters, servers, etc. who work hard to keep these communities going. Many of those buyers were heavily invested in the stock market and/or other industries that are not closely tied to the local communities.
On the other side, there are existing homeowners like those in Deep Creek Mesa, who have lived up the mountains their whole lives before things were so expensive, or inherited family properties. There are also the cities and counties and who responsible for maintaining these areas, who tend to lean towards bringing in as much revenue as possible and expanding their resources to better serve tourism, etc.
Who is right in all of this? Well, that depends what side you are on, and every stakeholder has a viable argument. However, I personally have to align with local climate scientist Adam Chambers, who moved to the Mesa in 2017. He said, “I’m pro-housing and I’m pro-neighbor. Let’s behave as neighbors first and try to find solutions as a community, rather than being so divisive.” It is hard to argue with that.
(Info Source: coloradosun.com/2023/02/02/telluride-san-miguel-county-rural-rezoning)
LOCAL MARKET UPDATE
Market Activity Is Increasing, But Not as Much as Last Year
Right now there is a feeling like spring is in the air. Of course, it’s not, but real estate agents always have to think 2-3 months in advance to keep their businesses running smoothly, especially in a slow economy. The good news is that activity does seem to be on the rise. More contracts are coming our way this month than last; when they were down about 9% city-wide from the year before, and things feel quite a bit more like a normal market for this time of year. However, although activity is picking up as part of normal seasonality, things are still much slower than the frenetic pace at the start of 2022.
If you look at the Monthly Market Snapshot, you can see that for-sale housing inventory at the end of January was 83% more than it was at the end of January last year. This is partially because buyer demand is lower due to recession fears, and listings are staying on the market about twice as long as they were before. However, average home prices were still up 2.5% from the year prior, which is a good sign that they are remaining steady so far, rather than declining quickly as some feared they would.
INFO FOR SELLERS
More Competition Means More Effort
For sellers, this increase in inventory means a little more competition this month. Your home needs to as easy to show and as presentable as possible. If it is hard to schedule a showing, or the house doesn’t show well upon arrival, buyers have more options to choose from than they did last year. They may simply move on. But if you can lock in a solid buyer, now may be a good time to do so before things get even more competitive in the spring. That is historically when the most sellers list their homes for sale, once the weather improves.
This market is very similar to the one we saw in January of 2020, right before Covid struck. That means things are still fairly competitive for buyers, but just not selling at extreme price premiums like they have over the past couple of years. You are much more likely to get offers at or just below market value right now than to sell at a premium.
INFO FOR BUYERS
More Options to Choose From
For buyers, things should be a little more comfortable than they were if you were looking for a home at this time last year. There are roughly 4,600 homes to choose from, which we haven’t seen since just before the pandemic. Inventory is still tight, especially in the entry-level price band, but buyers are a little less desperate than they were before. If you write an offer that gets rejected, do not get discouraged. It is common to place offers on 3 or 4 properties before one hits the mark.
Also, keep in mind that if a property is close to perfect but needs minor repairs made, you may be able to ask for slightly more seller concessions than you would have been able to a year ago. It is still a seller’s market, but you have a bit more working in your favor than you did before.
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