La Plata County / Durango Real Estate Sales Part 2

January 1st through September 30th for the years 2007 and 2008

In Part 1 of my blog, I discussed sales from January through September in 2008. In that post, I did not try to show comparisons to the same time period for 2007 as I was intending to do that in Part 2 To determine a trend we really need to do just exactly that... compare this year with the year before... and see which way we are heading.

Number of Units Sold Total number of residential units sold in 2008 are 172 units less than in the year 2007. That represented a decline of 24.4% in unit volume. The absolute numbers were: 705 units sold in 2007; while 533 units were sold in 2008. The busiest price bracket, which was from $200,000-$400,000, showed the least decline at 20.2%. While the sharpest drop came in the $1 million plus price range where the decline was 55% compared to 2007. With the success of the Silver Peaks Condominium conversion project, it was a little surprising to see that the price range from $100,000 - $200,000 actually declined by 30.2%. That said, during 2007 and 2008, the two busiest price brackets were the $200,000-$400,000 and the $400,000 - $600,000 price range.


Average Days on the Market As we have discussed earlier, if the market is slowing down, the average days on the market should rise because fewer homes are being sold and there is more inventory for buyers to choose from. I also compute the median number of days on the market as that will give a more accurate representation of what's really happening. You could have one or two listings that might be 700 - 900 days on the market that could really skew the average numbers. The median, on the other hand, is the center point where one half of the properties were on the market for longer than the median figure and one half were on the market for less than the median number of days. While the average days on the market in 2008 was 175 days, the median days on the market in 2008 was significantly less at 124 days. The difference is quite similar in 2007, when the average number of days on the market was 164 days while the median days on market was only 108 days. Hence the average days on the market only went up by 11 days from 2007 to 2008 while the median days on the market only rose 16 days. Neither one of the year’s median days on the market is an especially long period of time for Durango. Again, all of the price bands were affected differently. In the $600,000-$800,000 price band, days on the market actually decreased. In the million-dollar and over price band, days on the market increased by 27.3%. Again in the strongest price band of sales of $200,000- $400,000 homes, the days on market increased by only 3.3%. The next busiest price bracket, the $400,000 - $600,000 saw an increase of 15%.


Sales to List Price Percentage The sales to list price percentage is virtually unchanged from 2007 – 2008 in every price category. Overall, last year it was 96.97%, this year it's 96.25%. No percentage changed by more than 1% except for the $400,000 - $600,000 price range which went from 98% in 2007 to 96% in 2008. This is an indicator of several things. We don't have desperate sellers; sellers are pricing their homes properly; and sellers are waiting to get their price. Since our rental market here is so strong, some sellers are electing not to sell but instead go ahead and rent their property out. If we were in an area where we had lots of foreclosures and where we had serious economic turmoil, we would certainly expect the sales to list price percentage to be dramatically lower...but that is simply not the case here.

Number of Cash Sales This is an area where we have seen a marked change. In 2007, 13.05% of all sales were for cash; while in 2008 18.01% were for all cash. That is a significant increase. Similar to 2008, the $1 million and above priced properties had the largest percentage of all cash sales.... 25%. The next two largest categories were the $600,000-$800,000 price bands where 23.5% of the buyers paid all cash. Again in a somewhat odd anomaly in 2007, the $100,000-$200,000 price band had 19.7% of all those transactions paid for in cash and it jumped all the way to 26.6% in 2008 for those lowest priced homes. Reviewing every single price band, all but one saw an increase in 2008 in the percentage of sales that were paid for with all cash. Again, my contention is that people feel safer putting their cash in real estate that has an intrinsic value to it.

Where Did They Buy? The short answer is....in town Durango. In 2007, 256 units were sold while in 2008 it only dropped by 2 units to 254 units. Durango country properties went from 203 units sold in 2007, to 145 units in 2008… a drop of 28.5%. Bayfield rural properties went from 99 sales in 2007 all the way down to 47 properties in 2008… a decline of 52.5%. Clearly buyers were nervous about the cost of gasoline and transportation. Perhaps with the continued drop in oil prices and the expected decline in gasoline prices, buyers will again look at those country homes.

The entire two years worth of statistics are located on my website, BuyDurango.com and are available for your review. Remember that the statistics are for La Plata County only, represent only residential sales, and do not include any fractional or timeshare units. To review that data click here.