Vacant Land Taking The Hit
Friday, January 09, 2009
With the national economic slowdown that hit this past year, the most negatively impacted class of activity in 2008 was in the arena of land sales. For the first 3 quarters of the year, Steamboat real estate saw a 59% drop in transactions amongst vacant land sales. Overall transactions for the same period were down 36%.
Ironically, the average median price for parcels of land has increased by 109% over prior averages and residential prices increased 42%. Some of the explanations behind this are attributed to:
- Lack of affordable inventory. With no substantial new developments close to town catering to your average wage earner, there’s a lack of supply with this product type. With this lack of supply, older projects such as Silver Spur and Heritage Park that were originally introduced at affordable prices are now sky-rocketing.
- Increased price of new inventory. Most of the new subdivisions introduced to the Steamboat Springs real estate market over the last year have rolled out with prices well above the average median price of the area. These include the Steamboat Barn Village, Boulder Ridge and Graystone on the Green.
While few owners in our community are in the tough position of “having” to sell to keep their finances afloat, we are beginning to see prices decline amongst motivated sellers. Those that are serious about selling their property in the near future are becoming more realistic about the current market conditions. I suspect that that we’ll see these price increases level off in 2009 and the number of transactions begin to escalate as a result.