In today’s current market determining the value of your property is an interesting exercise.  Let’s start by examining what does not effect the value.  What you paid for your home does not effect it value.  The cash you need from the sale does not effect it’s value.  What you want for your home does not effect the value.  The price your neighbor got does not effect the value.  What your friends think the value is does not affect it’s value.  What a real estate broker thinks does not affect the value.  What an appraiser, for that matter, says does not effect the value.  So, what does?

In today’s market the value of your home is what a buyer is willing to pay based on how your home compares to others currently on the market.  So, let’s say you have a two bedroom condo/townhome and you value your property at $500,000ish.  Today you would be competing in the Vail Valley with 9 other listings between $500,000 and $550,000.   In this market of very few buyers, the question you need to ask yourself is what makes your property stand out above the others?    Why?  If you don’t stand out, you will just be in the hunt and can expect to be on the market for quite some time.  How can you stand out?  Find a competent Realtor to help with this complicated answer.

Today the Federal Reserve, along with several international banks, announced a half point rate cut in the banks’ lending rate. As a result the Stock Market finally started a turnaround, which today was 150 points higher than yesterday’s close. After losing almost 1,000 points since the $700 billion ‘bailout’ was announced, indicators are that investors are coming back into the market to pick up bargains after the ‘free fall’ of the past 10 days. No one has yet said that we are out of the woods, but we all know there is a bottom to every downturn, and it is possible that when new money comes into the market and ‘bottom feeders’ start their search for bargains, the support level forms up.

We look for bottoms in any market, and certainly the Stock Market uptick looks like investors are starting to recognize the opportunity to invest again. Another good sign was the announcement by the National Association of Realtors that existing home contracts had risen 7.8% since a year ago last August. The index then was 85.8 and had dropped as low as 84 in March of 2008, but is now up to 93.4 in August this year. This unexpected announcement was received with positive responses today, and hopefully is a sign that many of the distressed housing markets in states like California, Nevada, and Florida were seeing a bottom to their markets.

On a local basis, the Vail Daily reported last month that Eagle County has not seen an increase in foreclosures from the past year, as has been the case in other states. For that matter, even Summit County has actually seen a decrease from last year to this. In Eagle County, there were 112 foreclosures filed this year compared to a total of 140 in all of 2007, and 197 in 2006. Of that number 60% are timeshares because of the high pressure tactics used by their salespeople. In a resort area such as the Vail Valley, we are lucky to see the support for homes where scarcity still supports higher prices. Professionals at Gateway are always on the lookout for properties that come under pressure to be sold, and when you contact us, we are ready to help find the perfect purchase in a confusing market.

According to Land Title’s market report,  sales are remaining strong in the High Country.  It has been a good summer for home sales especially the multimillion dollar homes. 

Fall is a great time to get out and house hunt.  The weather is perfect, crispy and full of indian summer sun.  What a glorious time to get out and nail down that home for the ski season.  

For a tour or more information on what the Vail Valley has to offer please contact:

Jill Hopkins jill@gatewayland.com or 970.376.8692

When the US economy slides backwards, as we seem to be seeing in 2008, there will always be impacts felt throughout our strong Vail economy. Today, we have seen two strong indications that we are entering a slowdown here at home. East West Partners, which just this year won the prestigous Vail Valley Success award for 2008, has announced that it will be laying off as many as 21 of its key employees in the next few months. East West built much of Beaver Creek including the Hyatt Hotel, Willage Walk, the Vilar Center, and a number of high end condominium projects. They are currently finishing up the Westin Riverfront Hotel in Avon. Harry Frampton, President, stated that the ’soft’ real estate market makes it hard to start new projects in this market.

Also, in this morning’s Vail Mountaineer, it was announced that the Vail Plaza Club and Hotel is being sued by Shaw Construction for some $8 million for unpaid construction bills. Normally, when one sees a Mechanics’ Lien placed on a building, it is not a good sign for not only the project, but usually for other sub contractors who have not been paid by the General. In times when sales have slowed, this means that Developers might be willing to make deals with prospective Buyers because they need the cash now. We at Gateway always stay on top of these situations and can help smart investors find the opportunities that provide discounted pricing in a weak economy. One thing we know here, is that, while corrections always happen in a cycle, buying at the bottom will always mean large profits as the sales start to pick up again.

Always call me at Gateway for updates on what is a bargain. Judd Babcock, 970-376-3230

For the first time in the last nine months sales of real estate in Eagle County, home of Vail and Beaver Creek ski areas, have increased over last year.  July recorded over $243 million in sales with a large percentage coming from sales over $2 million.  The Lionshead area of Vail contributed a large part to the increase as many high dollar unit closed.  The average transaction price was over $1.5 million however the majority of sales transaction were under $1 million.  There are many listing at the present time and all can be seen on www.vailpropertysearch.com.  Just click on the boxes and up comes listing which might fit your need.  For further information on property in the Vail area contact Steve Morris at steve@gatewayland.com or call 970-926-6777.  There is still time you have your ski property for this season!

With many lenders in a liquidity crunch, buyers are finding mortgage money hard to come by. However, there is another alternative.

Of late buyers are finding it increasingly difficult to find mortgage money.  When prices of real estate adjust downward (nationally) banks holding mortgages find their ability to lend money for homes diminish.  Banks are required to have $1 dollar on hand for every $29 loaned out.  When things change, ie: value of real estate falls, banks find themselves in what is called a “liquidity crunch”.  Learn more about this by clicking on the attachment below.

Because many banks are faced with a liquidity crunch, they have no money, so to speak, to lend unless you are a well established customer.  Even then it is difficult to get financing.  However, there is good news for buyers; it’s a good time for sellers to be the bank.  Many sellers in the Vail Valley and Eagle County do not need the cash at closing and therefore are in a position to be the mortgage holder/bank for a period of time while this financial mess gets straightened out. 

It is a win-win situation for the buyer and seller.  Seller’s receive income from an asset they own at a higher interest rate than banks are paying for deposits and in all likelihood, get a safer return than putting the money in the turbulent stock market.  The seller still owns the home while receiving income in the form of interest payments until the buyer pays off the mortgage or refinances at some point in the future when the financial markets are in better shape.

The buyer wins during these times because there is another lending option available, the seller.  Once the financial markets stabilize the buyer can secure permanent financing for the home.

Now is a good a time to buy; lots of inventory with serious sellers pricing their property at the current market.  As strong as the Vail Valley/Eagle County real estate market is, it is unrealistic to think property values will increase 20% or more every year.  So, now is the time to buy while values are flat, before the next run-up occurs.  

The trick right now is to find a home that is properly priced with a seller willing to be the bank.  To do that, you need to find a broker who knows where those opportunities can be found.  So, what are you waiting for, find yourself a good broker and get out there and shop around.

Looking to cash in on a Buyer's Market

We are so lucky in the Vail Valley to have an economy that is based on scarcity of housing because of zoning restrictions and lack of buildable land. That being said, we have seen some tremendous ‘run ups’ in pricing in the past three years. If we did not have real estate ‘cycles’ no one would be able to afford a home here. But we are no different from any other resort town in the country. Prices have a way of evening out when there is a recession or other type of economic problem in the rest of the US economy.

Today we are faced with an ever enlarging inventory of housing mainly because of the national ‘credit crisis’. There are customers out there who want to buy but can no longer come up with the downpayments required by the new guidelines of banks in this environment. Back in the late 80’s, many Savings and Loans went out of business because of loose lending practices and today we see some similarities. However the bankers are smarter today and have cracked on low down payment loans. The result is that many a Seller does not have as many Buyers executing contracts because they can’t get loans.

All of the above is a major reason that Buyers today have the upper hand in making offers on property they want to buy, and we at Gateway have the expertise to help you with your purchasing decisions and enable you to find the property where you can get the best price. Please call me, Judd Babcock, for help in this turbulent market. As Nichols points out above, we will soon see the disparity equal out and prices will start to climb up again.

Eagle County Real Estate Sales Staying Soft

The first quarter of 2008 has come and gone, and the sales numbers are down across the board, except for the high-end market.  The high end market is seeing one of its best years ever.  There have been 25 residential transactions over $4 million through March 2008.  It would seem the segment of the population not affected by unstable financial markets are acquiring resort property in earnest.

The total sales volume of $228 million for March was 86% of last years March total.  The total number of transactions for the month, 145, is down 31% from last year and down over 50% from 2005.  The current trend is a decreasing numbers of transactions, with somewhat stable prices, leading to increasing average sales prices.  (this is somewhat misleasding, as individual homes are not seeing this price appreciation in the current market.)

Please contact me to recieve the March 2008 and the Year-To-Date sales statistics for Eagle County in PDF form, or to discuss the Vail Valley real estate market.

Vail Valley Real Estate Market Slows

Fourth straight year

For the fourth straight year, we have hit $2 Billion in sales, much of which is attributed to the high end market in Beaver Creek and Bachelor Gulch. Total volume is 20% above the same time period in 2006 and total number of transactions was 285, just 5% less than last year. Eagle again had the highest number of transactions at 37, and Gypsum is still close behind. Because of the national housing crisis, we have seen some softening in home prices and that is good news for clients looking for deals in the limited inventory of the Vail Valley. As is typical in every hot real estate market, we always see price corrections when Sellers try to take too much profit. This correction is will probably last another six months and then prices start creeping back up when inventories fall. Now is the time to start looking and making deals while there is ample homes on the market. Please feel free to contact Judd Babcock, your economic specialist at 970-376-3230 for more on this changing market.