The year 2022 has retreated into our rear-view mirror. The short-term message relative to the Telluride Real Estate Market in early 2023 indicates that mortgage rates may have eased off from their meteoric rise and the buying frenzy of the past two years has subsided.
A snapshot of year-end market data indicates a slowdown in the market evidenced by a retreat in dollar sales volume down 22% (2022 vs. 2021) and the number of transactions down 38%. Segregating the year-to-date (December) data from 2021 to 2022 within our larger regional markets (Telluride, Mountain Village, and the remainder of San Miguel County) reveals declines of 29%, 15%, and 25% respectively.
An optimistic data point reveals that total property sales of $5mm and above declined a modest 9% from 2021 based on transaction volume. Another bright point shows that although dollar volume and the number of sales pulled back in 2022, the overall price per square foot averages, across most property types, have risen or held firm due to very limited inventory.
What is perplexing is December 2022’s rapid sales slowdown of only 16 transactions - the least amount of any December dating back to 1985. This anomaly could be attributed to a perfect storm of a pandemic hangover, minimal inventory, and the initial shock of the rapid rise of interest rates in September and October, which translates into December closings.
While inventory continues to be very tight across all market sectors (which typically portends stability of pricing within those property classes) conversely, we have experienced “price improvements” within several market segments. For example, Town of Telluride single-family homes currently on the market total 22, 14 of which have enacted price reductions from their original offerings. With that said, there continues to be pent-up demand for well-priced inventory that affords good views, newer construction, or prime locations, as several new listings have recently contracted within a short period of hitting the market.
In sum, as 2023 begins, national and local economic forces continue to influence the market. Several sellers, especially those with properties the market is desirous of, are holding firm on their prices while others are exhibiting more motivation and re-evaluating their position ... a market where buyers now have a bit more room to negotiate. Time will tell as we enter the heart of the 2023 winter selling season.
Posted by Anna Wilson on
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