Eagle County Real Estate Market Report

Despite challenges with interest rates hovering in the 7% or higher range and continued limited inventory, the Vail Valley real estate market continues to demonstrate strength and resiliency.

The good news comes from the luxury and resort market, which gave a boost of strength to the Eagle County market. Third quarter of 2023, compared to Q3 of 2022, saw a 29% increase in dollar volume and just a small decrease in unit sales (down 8%). The challenge is in the below $1.5M market, where sales fell 34% to 136 in the third quarter 2023 versus 206 for Q3 2022.

"The numbers speak to the strength of the upper-end market," said Michael Slevin, president of Berkshire Hathaway HomeServices Colorado Properties. "The below $1.5M market continues to lag behind, with both limited inventory and higher interest rates taking their toll," Slevin added.

Looking at the last two 3rd quarters compared to what was considered the most recent normal market 2019, there is an even greater divide, when 343 properties below $1.5M sold that year. Price appreciation has elevated values and combined with higher interest rates it’s become buyers seeking financing are even more challenged with their ability to purchase a home in Eagle County.

"The top-of-mind question for buyers now is when to buy," said Slevin. Experts agree it is a double-edged sword. On the one hand, if the right property comes along and fits within a buyer's financial picture, Slevin says buy now. "Waiting until rates come down may yield a lower mortgage payment, but there is ample evidence that there is high demand ready to come into the market when the rates go down (and inventory rises) – which will create increased competition for homes, keeping prices elevated and potentially building a more challenging purchasing environment."

"Our market is in a unique cycle few have experienced. Overall, the good news is that inventory levels are seasonally appropriate (though the market needs much more) and buyers are facing less competition for homes," Slevin added.

So what does the current state of the market mean for buyers and sellers?

Luxury/Resort Market

Tisa Olsen, a broker associate with Berkshire Hathaway HomeServices Colorado Properties notes that the current luxury/resort market is presenting unique challenges for both buyers and sellers.

For buyers, the frustration is centered around seeking properties amidst a very limited selection that meets the discerning tastes of the higher-end buyer. The low inventory has intensified competition, leading to bidding wars and having homes sell in a matter of days. “Buyers need to be prepared to move quickly when a property that matches their desires comes on the market,” said Olsen.

Olsen also notes that there is opportunity for sellers who have a desire to sell to still capitalize on the substantial gains from recent years. “But it’s not a free-for-all,” said Olsen. “The properties that are selling quickly are priced right and sellers must be strategic in their pricing based on fair market value, which includes location, condition, and amenities. As more sellers come to realize the unique opportunity to capitalize on gains, there should be increasing inventory, which is good news for buyers,” Olsen added.

Down Valley Market

Scott Marino, also a broker associate with Berkshire Hathaway HomeServices Colorado Properties and a down valley market specialist, says that the single-family home under $1.5 million is still lagging behind. Of the 50 properties currently on the market, 60% of them are new developments that likely won’t be move-in ready until next summer.

As with the luxury/resort market, sellers are in a distinct advantage as long as the pricing is right. “Buyers have proven they are not going to over pay for a home outside fair market value, particularly with the higher interest rates,” said Marino.

“I am seeing some seller hesitancy about listing their property and having to pay more for a new home,” said Marino. “But it works both ways. If prices drop, sellers will typically get less for their home. The best advice I can give is if you’re ready to buy or ready to sell, do it now. There is no indication that there is going to be a dramatic shift anywhere – in prices or interest rates. Fall is a great time when buyers are looking to get in by the start of ski season and before the holiday season begins.”