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SU M M IT
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SUMMIT COLORADO SECOND QUARTER 2022 MARKET REPORT Report Written By: Elliot F. Eisenberg, Ph.D. Source: Matrix Multiple Listing Service
ECONOMIC OVERVIEW
Nationally
By: Elliot F. Eisenberg, Ph.D.
This has been a painful half-year for the U.S. economy, with 22Q1 GDP declining at an annualized rate of 1.6%. At this point, the best-case scenario for 22Q2 is for very slight growth, around 1% or so, but it is more likely to come in flat or slightly negative as the economy continues to be battered on multiple fronts. While the impacts of Covid-19 had been declining, they may be re-emerging, both in the US and globally, and supply chain issues, while improving, remain very troubling. Inflation is extremely high and is impacting household incomes. In fact, national real income has been declining since the fall of last year. Household savings, which had been near record highs, have declined, especially in lower-income households, and consumers are spending less. Fuel prices remain near record highs, negatively impacting both households and businesses, and the stock market posted the worst half-year since 1970, with both stocks and bonds performing poorly. Monthly employment growth remains strong, although first-time jobless claims have noticeably risen.
“The projected decline in inflation is unlikely to be fast enough to change the Fed’s rate-raising trajectory and certainly not after the recent strong jobs data. ” Collectively, this is a lot to overcome, and the forecast for GDP growth for CY2022 is, at best, 1%, with the probability of a recession sometime in 2023 at 75%. The good news - the economy entered this troubling situation in a much stronger condition than usual. Corporate balance sheets are strong, household finances are objectively good, and banking institutions are solid. If we do wind up in a recession, this is in no way a repeat of the Great Recession of 2008/2009. Current expectations are that inflation will top out no later than 22Q3, pulled back by both the Federal Reserve Board’s interest rate hikes, some organic improvements to supply chains, and slowing consumer demand, especially for goods. That said, the projected decline in inflation is unlikely to be fast enough to change the Fed’s rateraising trajectory and certainly not after the recent strong jobs data. Moreover, inflation has become increasingly economy wide and is no longer contained to autos, energy, and food. As a result, the Fed has made it quite clear that they will continue to raise rates due to worsening inflationary pressures even if it pushes the economy into a recession. They have signaled intentions to raise the fed funds rate every six weeks for the near future (perhaps for as long as a year) with the next several hikes in the 0.5%-0.75% range and then 0.25% until the inflation target rate is in sight. If inflation data does not worsen, the Fed will not meaningfully alter the current course, and 10-year Treasury and 30-year mortgage rates should not meaningfully change from where they are now. Of course, if inflation gets significantly worse, the Fed will tighten monetary policy further. Conversely, should inflation dissipate more quickly or if the economy stalls or falls into a recession, the Fed might institute fewer or smaller rate hikes, or stop rate hikes earlier than they would otherwise. Regardless, expectations of inflation went up rapidly in the first half of 2022, and rates are more likely, if anything, to fall from where they are now than rise.
HOUSING MARKET OVERVIEW
Nationally
There are several key factors to watch in the housing market for the rest of 2022. First, while mortgage interest rates are unlikely to rise significantly higher than they are now, we are already starting to see the impacts of rising rates on the housing market. May closed sales, based on contracts from March and April when rates had increased somewhat, already show signs of slowing, and with higher mortgage rates since, sales activity is likely to show additional declines. In addition to interest rate impacts, softening in the job market, reduced household savings, and falling equity prices will slow sales. We already see this in data for weekly applications for first-time mortgages, which continue to decline on a relative basis compared to pre-pandemic levels.
“Demand for housing is still high, and demographics remain favorable. Further, even if individual buyers get priced out, Wall Street is still buying homes for rentals, which puts a floor under price appreciation. ” Another meaningful change of late in the housing market is the rise in year-over-year inventories for the first time since early 2019. However, inventory growth, while high in percentage terms, in actual units remains relatively small. At the national level, available inventories are at 1.16 million units, still well below normal pre-pandemic levels. Price appreciation through the first half of the year was surprisingly strong, much stronger than most economists had predicted. However, higher home prices and interest rates will manifest in slowing rates of home price appreciation, which is likely to shift from 15-20% over the past year to closer to 5-7% by the end of the year. If inflation is considered, real price appreciation may be around zero. In terms of new housing supply, new construction of multifamily properties will continue to do well but perhaps soften slightly because of tightening credit conditions. Single-family starts are likely to decline somewhat from where they are now, but not by much. The number of single-family units under construction is relatively high, but that is less because of new starts and more because builders have been unable to complete homes under construction due to supply chain issues. Demand for housing is still high, and demographics remain favorable. Further, even if individual buyers get priced out, Wall Street is still buying homes for rentals, which puts a floor under price appreciation. Thus, even if there is a recession, there will be fewer impacts on the housing market because we have never been this undersupplied going into a recession, nor have so many homeowners had so much home equity. The bottom line, this housing market is still a seller’s market, but less so than it has been for the past few years.
BRECKENRIDGE
27 Boulder Circle, Breckenridge 6 BEDROOMS | 7.5 BATHROOMS | 5,260 SF
Single Family Homes Median Sold Price
Average Sold Price
19%
$2,062,500
2021 vs
$2,044,421
2021 vs
2022
Avg Sold Price per SF
$754
2021 vs
44
27%
$565,987
2022
$234,506,949
2021 vs
2022
Number of Properties Sold
52%
2021 vs
2022 Lowest Price Sale
$609
$286,219,004
$2,442,781
Avg Days on Market
24%
18%
21
141
2022
32%
2021 vs Highest Price Sale
34%
$1,544,250
Total Dollar Volume
28%
$12,200,000
96
2022
325 Four O’clock Road Unit #D-304, Breckenridge 2 BEDROOMS | 2 BATHROOMS | 1,094 SF
Condo/Townhomes Median Sold Price
Average Sold Price
$770,000
2021 vs
$965,000
$944,254
2021 vs
2022
Avg Sold Price per SF
30%
2021 vs
$1,055
36
2022
32%
$315,000
$186,018,136
$1,202,253
2022
Avg Days on Market
$128,641,027
2021 vs
2022
Number of Properties Sold
50%
2021 vs Lowest Price Sale
$809
31%
27%
197
18
2022
46%
2021 vs Highest Price Sale
25%
Total Dollar Volume
21%
$4,400,000
107
2022
KEYSTONE
Single Family Homes Median Sold Price
Average Sold Price
$1,820,000
33%
$2,507,500
2021 vs
$1,939,615
2022
2021 vs
Avg Sold Price per SF
$667
2021 vs
35
24% $550,000
2021 vs
2022
$25,759,120
2022
Number of Properties Sold
23%
2021 vs
2022 Lowest Price Sale
$541
$25,215,000
$2,575,912
Avg Days on Market
23%
2%
14
27
2022
29%
2021 vs Highest Price Sale
38%
Total Dollar Volume
9% $4,375,000
10
2022
22714 US Highway 6 Unit #5940, Keystone 2 BEDROOMS | 2 BATHROOMS | 838 SF
Condo/Townhomes Median Sold Price
Average Sold Price
41%
$802,500
2021 vs
$641,064
2022
2021 vs
Avg Sold Price per SF
$821
2021 vs
53
2022
8% $270,400
2021 vs
2022
$105,004,654
2022
Number of Properties Sold
81%
2021 vs Lowest Price Sale
$627
$100,005,929
$905,213
Avg Days on Market
31%
5%
10
157
2022
26%
2021 vs Highest Price Sale
32%
$607,000
Total Dollar Volume
18% $2,300,000
116
2022
COPPER MOUNTAIN
Single Family Homes Median Sold Price
Average Sold Price
3%
3%
$3,750,000
2021 vs
$3,850,000
2022
2021 vs
Avg Sold Price per SF
$766
4
2022
22% $3,000,000
$3,850,000
2022
2021 vs
2021 vs
$15,931,074
2022
Number of Properties Sold
225%
27%
2021 vs
$3,982,769
Avg Days on Market
Lowest Price Sale
$605
314%
13
1
2022
300%
2021 vs Highest Price Sale
$3,850,000
Total Dollar Volume
41% $5,431,074
4
2022
Condo/Townhomes Median Sold Price
Average Sold Price
5%
3%
$725,000
2021 vs
$743,367
2022
2021 vs
Avg Sold Price per SF
2021 vs
$871
14
2022
8% $300,000
$41,628,542
2022
2021 vs
$26,901,862
2022
Number of Properties Sold
14%
2021 vs Lowest Price Sale
$708
$768,625
Avg Days on Market
23%
35%
16
56
2022
38%
2021 vs Highest Price Sale
$692,500
Total Dollar Volume
26% $1,550,000
35
2022
SILVERTHORNE/DILLON
649 Fly Line Drive Silverthorne 3 BEDROOMS | 3 BATHROOMS | 1,876 SF
Single Family Homes Median Sold Price
Average Sold Price
36%
39%
$1,432,529
$1,830,000
2021 vs
2022
2021 vs
Avg Sold Price per SF
$609
2021 vs
23
2022
22% $485,000
$147,550,486
2022
2021 vs
$141,491,810
2022
Number of Properties Sold
43%
2021 vs Lowest Price Sale
$506
$1,992,842
Avg Days on Market
20%
4%
33
103
2022
31%
2021 vs Highest Price Sale
$1,344,840
Total Dollar Volume
71% $6,500,000
71
2022
Condo/Townhomes Median Sold Price
Average Sold Price
25%
$631,868
$688,250
2021 vs
2022
2021 vs
Avg Sold Price per SF
25
$686
2021 vs
2022
20% $211,277
2021 vs
2022
$107,169,412
2022
Number of Properties Sold
52%
2021 vs Lowest Price Sale
$502
$137,115,421
$788,010
Avg Days on Market
37%
22%
217
12
37%
2021 vs
2022 Highest Price Sale
17%
$590,000
Total Dollar Volume
80% $2,389,000
136
2022
FRISCO
Single Family Homes Median Sold Price
Average Sold Price
26%
$1,862,786
$2,100,000
2021 vs
2022
2021 vs
26%
10%
2022
21% $1,350,000
2021 vs Lowest Price Sale
2021 vs
10
2021 vs
2022
Avg Days on Market
$782
$26,079,000
$2,241,591
Avg Sold Price per SF
$621
5%
20%
$24,657,500
2022
Number of Properties Sold
11
14
2022
21%
2021 vs Highest Price Sale
$1,662,500
Total Dollar Volume
2% $3,250,000
11
2022
Condo/Townhomes Median Sold Price
Average Sold Price
$767,050
34%
$1,000,000
2021 vs
$828,259
2022
2021 vs
Avg Sold Price per SF
$834
2021 vs
7
2022
57% $410,000
$53,008,549
2022
2021 vs
$54,389,614
2022
Number of Properties Sold
43%
2021 vs Lowest Price Sale
$627
$1,109,992
Avg Days on Market
33%
3%
4
64
2022
23%
2021 vs Highest Price Sale
30%
Total Dollar Volume
15% $2,192,850
49
2022
PARK COUNTY
71 Sheep Ridge Road, Fairplay 3 BEDROOMS | 3 BATHROOMS | 2,076 SF
Single Family Homes Average Sold Price
23%
$503,100
$525,279
$620,000
2021 vs
26%
Avg Days on Market
24%
0%
$384
2021 vs
2022
90% $275,000
Lowest Price Sale
2021 vs
40
$58,305,923
$66,692,350
2021 vs
2022
Avg Sold Price per SF
$311
14%
$660,320
2021 vs
2022
Total Dollar Volume
2022
Number of Properties Sold
40
111
2022
9%
2021 vs Highest Price Sale
Median Sold Price
108% $2,150,000
101
2022
Condo/Townhomes Average Sold Price
100%
$649,000
$731,333
$0
2021 vs
Avg Sold Price per SF
100% $0
2021 vs
195
100% $0
$2,194,000
2021 vs
2022
$0
2022
Number of Properties Sold
100%
2021 vs
2022
100%
$0
Avg Days on Market
Lowest Price Sale
$244
100%
2021 vs
2022
Total Dollar Volume
0
3
2022
100% 0
2021 vs Highest Price Sale
Median Sold Price
100% $0
2022
LIFESTYLE. LUXURY. LEGACY. 323 N. Main Street Breckenridge • 970.344.9002 Info@ChristiesSummitCORE.com • ChristiesRealEstate.com