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2021 real estate sales breach $1.6 billion in La Plata County

Continuing trend of low inventory, high prices closes out the year
Eighty-five cash sales of residential properties priced at $1 million or higher occurred in 2021, up by 34 units from the previous year. The highest-priced home sale in La Plata County in 2014 was this $3.35 million, 5,587-square-foot house on Celadon Drive near Glacier Club. (Jerry McBride/Durango Herald file)

Total real estate sales in 2021 reached over $1.6 billion in La Plata County, setting a record for the area and sending another warning flare into the air for the working class as local leaders apply a magnifying glass to the housing crisis.

End-of-year real estate statistics released this week by the Durango Area Association of Realtors reveal residential inventory continues to decline while sale prices shoot upward.

The total volume in all real estate sales last year, including residential, land and business sales, equaled $1,653,756,762, according to end-of-year data released by DAAR.

La Plata County’s total volume in sales across in-town homes, country homes and condos/townhomes alone equaled $1.4 billion.

Heather Erb, managing director at the Durango office of Coldwell Banker Distinctive Properties, said in an email to The Durango Herald that the lack of inventory is driving prices so high that the county can achieve a higher value of homes sold despite less overall sales.

“Until we see more inventory, we will continue to see prices increase,” Erb said.

She said increases on mortgage interest rates expected in 2022 will put some pressure on buyers, but that won’t be enough to make a difference in how the market ultimately shapes up this year.

“Luxury home sales also pushed up the (price) volume of home sales tremendously,” Erb said. “If you want to see the effect of luxury sales on the market, take everything that sold for over $1M in 2020 and 2021. The number of home sales in the MLS in this segment increased by 86% in one year!”

Rick Lorenz, broker at Durango Wells Group Real Estate, said he also thinks some buyers could be dissuaded from jumping into the market if the federal government raises mortgage interest rates, which would help inventory a little.

Record sales have troubling implications for workers such as teachers and nurses, Lorenz said. He noted that even attorneys might have trouble finding a place to live in Durango if prices continue to rise at the rate they have been.

Lorenz warned that Durango is well on its way to becoming the next Telluride, where the working class has been priced out of town, and wondered if that community would course-correct its real estate path if it had another chance.

The broker echoed many sentiments that could be heard at recent housing meetings hosted by La Plata County Economic Alliance and Durango Chamber of Commerce. He said that NIMBYism (not in my backyard) isn’t helpful and that he is worried for young professionals if residential prices continue to climb while the number of units available keeps declining.

Lorenz said three or four years ago, 400 available units was considered a low inventory. Just 110 residential units were available as of Dec. 31, according to his data.

Bayfield in-town homes sold at a median price of $399,000 last year. In 2020, in-town homes sold at a median price of $331,500, according to data from the Durango Area Association of Realtors. (Courtesy of Bayfield Realty file)

DAAR statistics show 182 residential units priced at $1 million or more were sold last year versus 98 $1 million-plus units sold in 2020. Despite the fact that the number of units priced at $1 million or higher nearly doubled in 2021, the total number of units sold across all price ranges fell slightly from 1,456 units to 1,420 units.

The median price for the 181 in-town Durango homes sold last year came out to $650,000, an increase of $75,000, or 13%, from the median price of 216 Durango in-town units sold in 2020.

In Bayfield, 65 in-town homes sold at a median price of $399,000 last year, versus 80 in-town homes sold at a median price of $331,500 in the year before last.

Lorenz said in a written analysis that while average and median residential prices rose notably, “over $1 million properties are truly having a major impact on the total dollar volume.”

He said the number of buyers purchasing homes with cash rose significantly last year compared with 2020. There were 85 cash purchases on units priced at or above $1 million last year versus 51 cash purchases the previous year, according to Lorenz’s data.

Cash purchases on properties priced $1 million or higher represented 46.7% of sales in that price category, he said.

The lack of inventory is driving the price of homes across the county upward. DAAR board of directors President Lois Surmi said the current market is a seller’s market in a December interview with the Herald.

Lorenz agreed that a lack of inventory helps drive up prices on units in stock as a result of supply-and-demand economics. He said sales are also being driven by a fear of missing out on the chance to buy a given unit. Some buyers are willing to pay above market listing price, too.

It isn’t too uncommon for a buyer to pay a couple thousand dollars above listing price at times, he said. But more recently, he’s worked with people who have spent $200,000 above the listing price.

The La Plata County Economic Development Alliance recently received a Rural Economic Development Initiative grant from the state of Colorado in partnership with the city of Durango.

Michael French, alliance executive director, said the money will be used to create “a workforce housing investment strategy or investment plan” aimed at aiding resident workers with housing amid an evermore expensive real estate market.

In addressing the housing crisis, Lorenz said expansion of utilities and larger residential housing development will be needed to accommodate the demand for more inventory.


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