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INFLECTION ???
In the YOY comparison of the first five months...
For the first time in ten years, the average valley-wide sold price has declined. The volume of transactions and the sold price per square foot remain positive*. Yet, a fourth metric illustrates another integral condition: there is a significant increase in days on market. That is change which has been evolving slowly over the past six to twelve months. (*The SPPSF increased by an unch overall, but it shows a decline in most micro-markets. There are micro-market reasons which may not necessarily be negative and are likely situational).
Inflection point (noun) In mathematics: a point of a curve at which a change in the direction of curvature occurs. In business: a time of significant change in a situation; a turning point.
Have we crossed an inflection point after which average market value keeps declining? Maybe. It is too early to draw a conclusion. The market conditions and the trend will become more apparent after another selling/buying season...by Thanksgiving.
Buyers have become more particular, more patient, pragmatic. Such behavior slows the pace of sales; increases time on market and leads to price reductions (that process is a wormhole in and of itself...ask me about it). The post-pandemic pace was not/is not sustainable and 2026 might solidify we have been referring to as the 'normalizing' of the market.
THOUGH THE TURN SIGNAL IS BLINKING, THE PACE IS STILL GOOD
The most critical aspect of the equation is demand and despite the daunting earthen and political climates, the number of transactions remain the same. I'll spell it out...
The crappiest ski season/snowfall in forty years
+ the Iran ‘war’ ...which started three months ago
+ inflation and interest rates ...which are not decreasing
= sustained # of units sold and SPPSF
...this epitomizes a resilience of the Vail Valley market and that is not happening in many markets across the state nor country.
SO, WTF?
If you are contemplating selling and/or buying this year, the data clearly shows that scrutinizing the disposition of the subject property will be a bit more complex and strategic. Generally speaking, if you are a potential seller and you believe a downward trend will continue, you’d certainly want to tackle your sale this year. If your home lacks an ideal view/setting/finish condition, the now-existing longer market times would justify expediency to market. If you want to buy this year, it is still very safe to invest in this valley with the basic principle of buying with the intent of a long-term hold. Yes, of course…if you want some insight to your equation, call me.
Please be aware, examining average sold price is an economic indicator and it does not mean that your house pers se, has lost value. As I have always preached, this valley has many micro-markets and certain properties will defy the averages. Read a few more words here: MICRO-MARKETS
And now for a look at the numbers... click on the chart to expand
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