Even though the Steamboat Springs short-term rental regulations are still new, having just been passed in June, local realtors have already noticed some effects on buyers’ preference for homes.
Jill Limberg, chief broker at Steamboat Sotheby’s International Realty, described a real estate climate in which properties listed in areas where short-term rentals are restricted or prohibited do not receive as many offers as those where short-term rentals are allowed. without restrictions.
Limberg compiles weekly property reports, but statistics comparing property listings in different areas of the new short-term rental overlay map are not yet recorded. The overlay map limits the number of short-term rental licenses issued in certain areas of the city.
While Limberg doesn’t have any hard stats yet, she said she’s seen first-hand how overlay zones are changing the market.
“Properties that are in the section of the overlay map that don’t allow overnight rentals that don’t have the potential to grandfather, those properties are on the market,” Limberg said. “Because they are sitting in the market, we are starting to see price reductions with these properties.”
Properties that have been operating legally as short-term rentals in the year prior to the passage of the overlay zone may apply for non-compliant legal status.
Jon Wade, co-founder of the Steamboat Group, said the popularity of vacation rental websites such as Airbnb.com and VRBO.com have changed the nature of Steamboat vacation rentals.
“The market used to be segmented,” Wade said. “Properties south of Walton Creek were not renting very well in the short term. When Airbnb and VRBO came into being, a well-curated property with the right features south of the creek with no amenities suddenly started renting really well.
While he said the overlay zone is likely to have some effect on the housing market, he thinks it will still take several months or even years to get an accurate picture.
“Before, you had to be north of Walton Creek with amenities,” Wade said. “So it’s almost like we’re going back to that time in some ways, with exceptions for grandfathered units.”
Limberg and Wade agreed that various factors, including rising interest rates, inflation, an unstable stock market and uncertainty surrounding the war in Ukraine, have slowed the real estate market nationwide and in the county. of Routt.
The housing market in Steamboat, in particular, cooled for several months after a two-year period in which real estate boomed more than ever, according to Wade and Limberg.
“Ever since COVID hit, we were all worried there was no market,” Limberg said. “It ended up being crazy.”
After the influx of buyers coming to Steamboat during the pandemic, Limberg said, it’s become common to receive floods of offers within 24 to 48 hours of listing a property.
“While this market was going crazy during the binge eating, real estate agents would go meet with sellers to list their homes, and the seller would hear that his neighbor’s house had been put on the market for this astronomical price and sold very quickly,” Limberg said.
The listing price, which measures the average sale price against the listed price of the property, was up 98.4% in August, according to Redfin.com. August was the first month since December 2021 with a selling price below 100%, meaning August was the first month in 2022 that, on average, properties were selling for less than their listed prices.
“There really was no rhyme or reason why people were pricing their homes where they were,” Limberg said. “They were totally taking advantage of the market because they could, and there were enough cash buyers in the market. When someone pays cash, it doesn’t matter if that house is appraised or not, because they are paying cash. They don’t need to have an assessment.
But Limberg says those days seem to be in the rear-view mirror as properties receive fewer offers and buyers have more clout.
According to data compiled by Redfin.com, the median days on market, which identifies the typical selling time for properties, was 13 for August in Steamboat, Steamboat’s highest market since January.
“People have time to make decisions,” Limberg said. “Buyers have the ability to insert inspection clauses, which they couldn’t do before because you wanted your offer to be as good as possible.”
Redfin.com/Screenshot
Both Limberg and Wade said buyers have more leverage now than they did at the start of the year because buyers are more able to plan contingencies in their contracts and demand inspections.
“Moderation has to come at some point,” Wade said. “Right now, we are seeing healthy moderation. That might change at some point, but so far it’s been encouraging and we’re remarkably resilient.
Both Limberg and Wade said they expected local realtors to return to a traditional workflow after more than a year of rotating properties at such a rapid pace.
“You would get a list and you would have all these offers to deal with,” Limberg said. “Now you put a property on the market and you get viewings. Then you receive offers several days later. You can actually go through the process as usual.
To reach Spencer Powell, call 970-871-4229 or email him at [email protected]
