Delta County Summer Market Report — A Balanced Market Biding Its Time By BOB LARIO RE/MAX Mountain West, Paonia Office To say the market is difficult to analyze would be an understatement. National media reports are conflicting and confusing: “Home Sales Down,” “New Listings Down,” “Home Prices Rebounding,” “Home Prices Softening,” “Buyers Waiting for Market Crash.” It’s no wonder that buyers and sellers are uncertain and fearful. Even real estate agents, many of whom now work from home and obtain their market information from the same media sources as their clients, are confused. Fortunately, the market is not crashing and will not crash. Unlike what we saw during the recessionary period of 2006 to 2011 when many homeowners were “under water” with loan balances higher than their home values, current nationwide statistics show that 39% of homeowners have no mortgages and another 29% have equity in their homes of 50% or more. Looking at local statistics in the table below, we see sales activity in all three areas of Delta County down substantially from the same time last year. However, market” in a downward trending market often results a a closer analysis reflects that most this decrease To say theofmarket is difficult to analyze would be an understatement. National media in reports sale at a lower price that what the seller would have received occurred during the first 4 months of 2023, which compared are conflicting and confusing: “Home Sales Down,” “New Listings Down,” “Home Prices poorly to the same period in 2022. The number of sales during if the property had been priced correctly in the beginning. Rebounding,” Prices Softening,” “Buyers Waiting for2023 Market no wonder There’s no doubt that the DeltaCrash.” County It’s market has the second quarter of 2023, though still “Home down, compared continued to level off since the feeding frenzy market of 2021 more favorably to sales lastthat yearbuyers after the downturn began. and sellers are uncertain and fearful. Even real estate agents, many of whom now The comparison report also shows that for the first time in and the first half of 2022. Inflation and the Fed’s increasing work from home and obtain their market information from the same media sources as their 11 years, average selling price has decreased, Surface Creek interest rates have not only discouraged buyers, but have also inhibited many sellers who normally would be selling to clients, are confused. being a notable exception. The number of homes for sale satisfy lifestyle changes but are unwilling to trade their low has steadily increased this year, especially from May to July. interestand mortgages current 6.5 to 7%-rate loans. However, the number of new listings coming on the market Fortunately, the market is not crashing will notforcrash. Unlike what we sawAccording during the to a recent Redfin analysis, 82.4% of all homeowners with a each month has lagged behind last year. So it appears recessionary period of 2006 to 2011 when many werewith “under water” with mortgage in the U.S. homeowners hold a 30-year loan an interest rate that new listings, although decreased, are still outpacing below 5%, 62% are below 4% and 23.5% have a rate below 3%. loan balances higher than their home values, current nationwide statistics show that 39% of properties being sold, resulting in increased inventory. The So there’s a pent-up demand and a pent-up supply in “Months Supply of Inventory” was 3.6 athave this no time last year and another 29% have equity in their homes of 50% or more. homeowners mortgages both the national and local housing markets. The obvious and is now 5.6; “Days on Market” for a property to sell has key to unlocking this backlog of market activity is a lowering increased from 97 to 133 (up 37%); and “Percent of List Price Looking at local statistics in the table below, we see sales activity in all three areas of Delta of mortgage interest rates. We recently watched a podcast Received” has decreased from 98.3 to 97.2: all indications of from the same time year. However, a closer analysis and reflects featuring Davidlast Stevens, a renowned economist a more balanced market County between down buyerssubstantially and sellers.We’re mortgage expert, who described the Federal Reserve’s still seeing many sellers holding onto the pricing strategies of that most of this decrease occurred during the first 4 months of 2023, which compared poorly the early 2022 market. In most cases, this is wishful thinking. history of overshooting interest rate hikes to curb inflation, toConsequently, the same period in 2022. The number of sales during the second 2023, though stilltodown, more followedquarter by a of lowering/correction avoid compared a recession. many homes are coming on the market at Stevens bullishly forecast that 30-year mortgage rates would favorably to sales last year after the downturn began. too high a price, followed by numerous price reductions to achieve a sale. The phenomenon known as “chasing the Continued on page 28
LARIO TEAM MARKET REPORT
Summer
2023
A BALANCED MARKET: BIDING ITS TIME
YEAR TO YEAR COMPARISON REPORT AS OF July 31, 2023 Sold Listings 2022
Sold Listings 2023
% Change
Average Sale Price 2022
Average Sale Price 2023
% Change
Inventory of homes for sale 2022
Inventory of homes for sale 2023
% Change
North Fork
83
59
-28.9%
521,922
497,539
-4.7%
73
66
-9.6%
Delta
159
95
-40.3%
378,131
344,635
-8.9%
70
74
+5.7%
Surface Creek
106
76
-28.3%
358,275
443,041
+23.7%
49
56
+14.3%
Delta County
347
227
-34.6%
406,114
415,878
+2.4%
190
196
+3.2%
Montrose County
495
406
-18.0%
443,965
438,798
-1.2%
194
214
+10.3%
Conclusions in this newsletter are based in whole or in part on data supplied by the Delta County Board of REALTORS and its Multiple Listing Services. Neither the Board nor the MLS guarantees or is in any way responsible for its accuracy. Data maintained by the Board or its MLS may not reflect all real estate activity in a market. Real Estate Today | October 2023 | www.coloradorealestatetoday.com
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The comparison report also shows that for the first time in 11 years, average selling price has decreased, Surface Creek
