We’ve been hearing for some time that inventory is tight in the Eagle County real estate market. But the local market continues to break records. How is it going?
The market in the first four months of this year is moving well into 2019, the full year before the COVID-19 pandemic essentially wiped out the second quarter of 2020.
Despite discussions of low inventory, deals are still closing at a rate almost equal to that of the second half of 2020. The second half of this year brought the county’s real estate market to record highs in terms of deals and volume. dollars.
This heavy activity has left the valley’s formal inventory low – as measured by property for sale in the county’s multiple listings service.
Dan Fitchett, the Vail Valley management broker for LIV Sotheby’s International Realty, said the activity was largely driven by the change in tactics used by brokers.
Fitchett said the “creative brokers” do a lot of work for buyers and sellers. The current market, in which ownership does not last long in virtually every sector of the market, has forced brokers to change the way they work, Fitchett said.
It’s a lot of work
Once a broker has determined a buyer’s needs and wants, that broker begins to prospect for this type of property. This includes chatting with former clients and networking with friends and other brokers.
Working with buyers also requires good training and homework on the buyer’s part.
This includes obtaining a pre-approved mortgage.
“(Buyers) need a letter stating that you are qualified to borrow a certain amount of money,” Fitchett said. Buyers who don’t pay cash should also be prepared to have enough cash on hand to cover any difference between a home’s appraised value and a home’s actual price.
Matt Fitzgerald, chairman of the Eagle County Market for Slifer Smith & Frampton Real Estate, said sellers often make deals with buyers on the condition that the seller finds their replacement home.
Brokers should “maintain good contact,” Fitzgerald said, adding that buyers and sellers should “be prepared for a quick transaction.”
To keep up with a rapidly changing market, brokers, buyers, and sellers also need to understand values and how quickly they can change right now.
Longtime local broker Ron Byrne, owner of Ron Byrne & Associates Real Estate, said all of this personal contact could be new to many brokers, but not to those at his company.
Byrne noted that many of his brokerage firm’s transactions never reach the multiple listing service.
It’s from person to person
Byrne has lived on the Vail Forest Road for about 30 years. He said he often spoke to his neighbors about everything from daily gossip to rising values on property tax bills. Sometimes Byrne’s neighbors talk about their desire to sell their home in the neighborhood.
“Sometimes we talk to someone looking (for a house),” Byrne added.
This approach is why many Byrne sales are not public until they appear in the Eagle County property records.
As Eagle County’s economy has seen peaks and valleys over the decades, Fitchett said he doesn’t think the current market is a bubble like the one that burst around 2008.
Fitchett noted that for several years, contractors across the country haven’t built as many homes as demand demands.
Fitchett said LIV Sotheby’s gets a lot of economic information from Chase. This company believes that the supply shortage will persist for some time.
“When the offer is expensive, the price goes up,” he noted.
And, Fitchett added, many brokers made a mistake in talking about low inventory in the valley.
“There are transactions going on – we have to get that word out,” he said.