How high will interest rates rise and what does that mean for the Durango real estate market? Dan Korman of Alpenglow Properties discusses interest rates, active listings, sold homes, and pricing for single family homes in February. This story is sponsored by Alpenglow Properties, LLC
Welcome to the Real Estate Update. My name is Dan Korman, owner broker of Alpenglow Properties right here in Downtown Durango, Colorado. It's been a busy year so far, and in the last two months Alpenglow Brokers have leased up over 6,700 square feet of commercial space around town and we have a brand new commercial listing for sale in Bodo Industrial Park. The space comprises over 4,100 square feet of office, showroom and warehouse for $1.2 million. Take a look on our website at alpenglowproperties.com for more details. The housing market is facing headwinds this year as the average 30 year mortgage rate is inching its way back towards 7% and crested it recently. A less than enticing number for folks running out to get financing right now. It's a tough choice to make these days, and no one is fully sure where the terminal rate will actually end, with some economists predicting that the Fed will continue bumping the rate until it reaches about 6% by the time it's all said and done. For clarity, a 6% federal funds rate could put the 30 year mortgage rate in the 8 to 9% range, so that would make today's 6.5% mortgage sound quite affordable, right? Well, overall it's a math problem so since rates may not ever come down to 3% again we have to start making financial decisions based on what will someday be a new normal. My best advice during this time is to really hone in on your goals as they relate to your housing and business needs. Be sure to make investment and divestment decisions based on those goals and try not to try to time the market. Speaking of the market, here are a few of the most recent housing statistics. There were nine single family homes sold in February this year, almost doubling the amount of homes sold in the same month of 2022. The Median sold price landed at $865,000 last month, which was a 30% increase year over year for February. While still high on average the Median prices this year are down from the single month's record high Median price of $1,068,000 based on the nine sales in December of '22. So that's good, I guess or our inventory remains low as the end of February there were only 13 homes available on the MLS, and today only 10 exist due to three going under contract the first week of March. The greater La Plata County area actually has over 90 single family homes on the market for sale. So, if you don't have to be in the city of limits of Durango there are definitely more properties to choose from. We'll do a deeper dive on the statistics from Bayfield to Purgatory and all other asset classes including condos and town homes next month, once I'm able to aggregate all of the first quarter data. If you or someone you know is interested in learning more about the real estate market in your area, you can reach me via email at dan@alpenglowproperties or send me a message on any of our social media handles at DurangoBrokers. Thank you for watching, compost your food scraps and see you next time.