Q4 2020 Real Estate Perspective: What happens next?

I have heard two opinions about what may happen next in real estate.  I sat in on a zoom meeting with the Leading Real Estate Companies of the World and they indicated that this movement by people to more rural areas, suburbs, beaches and mountains will last 1-3 years.  The reasoning is that when the pandemic will be under control, “city dwellers” will return to the cities for their restaurants, entertainment, sporting events and health care services.  This scenario would indicate future inventory here.

Then the National Association of Realtors shared that homeowners are staying in their homes for a longer period of time: from 13-18 years rather than 7-10 years prior to 2009.  If you think back to last recession which began around 2009, that was 11 years ago now so that may be an accurate statement as well.  I have noticed that some Sellers that purchased a home back then and have acquired equity and are selling their home and upgrading today.

The National Association of Realtors also contemplated that the real estate market throughout the US sold 3-5 years worth of real estate in the past 9 months.  Prior to the Coronavirus, realtors from across the county thought that real estate was going to drift downward in 2020, but that was not what happened.  After a few months of spending indoor time in their current living situations, people had time to evaluate what was important in their lives and many made changes.  Our numbers were off the charts as we closed out 2020.

In 2020, residential transactions throughout the county grew by 191 transactions compared to 2019 and 107 transactions in 2018.  Total dollar volume for all residential types reflected $457,709,857 in 2020 vs $269,089,795 in 2019; this represents a 70% increase in sales volume year over year. 

Buyers chose single family homes over condos/townhomes last year and the market observed a total of 126 more transactions in single family homes and 68 more condos and townhomes were sold.  The highest number of single family homes were sold in Rural Gunnison with 74 transactions, followed by Rural Crested Butte with an 62 transactions and then Downtown Crested Butte
with 41 transactions.  

Condo and Townhome transactions were up 49% compared to 2019.  During 2020 condos and townhomes saw an increase of 68 transactions over 2019 and only 11 sales above 2018.  This year set a record of 19 condo/townhome sales over $1,000,000 compared to 6 in 2019.  

Back in December 2020, Freddie Mac and Fannie Mae changed their mortgage product offerings and began to apply restrictions for lending on properties in resort markets that have short term rentals and a front desk within the complex.  Currently here in Crested Butte, The Lodge at Mountaineer Square, Grand Lodge, Three Seasons and Elevation complexes fall into this category.  Mortgages can be obtained by working with a bank, however the interest rate is around 4% with 25% down.  Click Here for the story.

Vacant Land was slow to move earlier in the year but had a strong finish with 307 closed transactions compared to 202 in 2019 and 274 in 2018.  When Buyers were unable to find the home they wanted, they purchased land to fall back on in case a residential property does not come on the market prior to building.  Construction Professionals are saying they have enough business for the next 3-5 years.