Routt County real estate sales top $1.2B in 2020; 2021 unlikely to hit last year’s peak
STEAMBOAT SPRINGS — Routt County real estate sales in 2020 were unprecedented.
That’s the adjective David Baldinger, broker and co-owner of Steamboat Sotheby’s International Realty, used to describe the pace of sales last year, which saw the highest sales volume in more than a decade.
Real estate sales totaled over $1.2 billion in 2020, the second-largest amount of sales in a single-year ever recorded. The highest was in 2007 when Routt County sales hit $1.6 billion. Since 2016, sales in Routt County have practically doubled.
Sales were up slightly heading into January 2020, then February and March were considered strong. Suddenly COVID-19 forced closures and restrictions, and the economy stalled. Because of that, a large percentage of transactions under contract didn’t move forward.
“That created a lot of fear and uncertainty for a month or two,” Baldinger said.
Then, in summer 2020, sales volume nearly tripled. The local market reached a fevered pitch in September and October, when sales hit record peaks, which Baldinger attributed to three factors including pricing, inventory and absorption rate.
“The second two quarters (of 2020) may have had the most robust pace of sales that we’ve seen in recent memory,” he said. “2020 was an unusually productive year in terms of total sales volume, which was in some ways unpredicted when COVID hit.”
Prior to 2020, the local real estate market has steadily increased each year.
Steve Goldman, CEO of Colorado Group Realty in Steamboat Springs, said sales volume increased about 10% to 12% each year over the last decade.
Then came 2020, a year tarnished by a pandemic, and the local market exploded.
A total of 1,620 real estate transactions were completed in 2020, up 32% from 2019. Many of those were for high-dollar properties. It appeared wealthy individuals were better able to weather the COVID-19 pandemic, according to Goldman, which accounted for the increase in luxury market sales. There were also more luxury homes — worth $2 million or more — in Routt County due to appreciation.
Having 73 closings on luxury homes, compared with 36 in 2019, has had a “huge impact” on a small market like Steamboat, Goldman said. Those high-dollar sales increased the average closing price.
In 2020, a single-family home sold for an average of $1.47 million in Steamboat, up 12% over 2019. The average price of a condo or townhome was $636,000, up 19% in the last year. The average price per square foot increased by 13% — $432 per square foot in 2020 up from $382 the year before.
In addition to luxury home buyers, the market was driven by low inventory. While that lack has been a continuing factor in Steamboat’s real estate market, Goldman now considers it to be extreme.
“Inventory looks to be a problem for the market for a while,” Goldman said. “We could triple or quadruple our inventory and still sell it all.”
There are 98 properties — including single-family homes, condos and townhomes — for sale right now in Steamboat. To put that in perspective, the number of available homes reached a peak of 373 in July 2019, and this time last year, there were 214 properties up for sale.
“We’re seeing frustrated buyers — buyers that need to be prepared to jump on sales right away,” Goldman said.
The mystery now is how inventory will look in late spring and early summer, which is traditionally when a majority of properties come onto the market.
The imbalance between inventory and demand makes it more difficult for buyers looking for affordability.
“People want to live here, and there’s not enough houses to support that,” Goldman said.
Goldman expects that places like Oak Creek and Hayden will continue seeing growth because of their more affordable home prices.
Oak Creek saw a surprising 68% increase in sales volume from 2019 to 2020. A total of about $61 million in homes were sold last year. Hayden saw a similar yet not as sizable increase, with $19 million sold in 2020 compared with about $16 million in 2019. Property in Oak Creek appreciated by about 33% on the year while Hayden saw 10% appreciation, according to Goldman.
Another trend that started in the last quarter of 2020 — sales of lots for single-family homes and acreage sales of undeveloped properties — is seeing significant increase. According to Baldinger, this is likely due to dwindling inventory, which may stimulate increased construction activity over the next few years.
2021 unlikely to see sales volume like in 2020
Reaching the peaks seen in the late second and early third quarter of 2020 isn’t likely in 2021.
“I can’t imagine us getting to that level,” Goldman said. “I don’t see how it’s possible without inventory.”
Baldinger agreed and cited a need for significant new inventory to reach those high numbers.
Already in the first few days of 2021, the market is experiencing more competitive activity with the few new listings coming online. There were some of those situations in 2020 but not as many as one would maybe predict, Baldinger said.
But the first quarter is not a good indicator of what the local market will do as most of it is a result of handshakes made at the end of the previous year, Baldinger said.
In the last two decades, the first quarter has only made up a sixth or eighth of total sales volume, according to Baldinger. The second quarter is more what determines the pace of the market, he said.
To reach Bryce Martin, call 970-871-4206 or email bmartin@SteamboatPilot.com.
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