The real estate market here and in San Juan County is modest compared with bigger burgs, but it follows the same boom-and-bust cycles.
Increased buyer interest that started last year indicates the market might be coming out of the multiyear doldrums that began in 2008 when the nation’s economy crashed and burned, said Anne-Britt Ostlund, owner/broker of Mountain Rose Realty.
“Things are looking up,” Ostlund said. “The inquiries we’re getting are primarily buyers looking for homes under $150,000.”
Jess Wegert fits the description.
Wegert, 27, who works in construction, last August bought a 115-year-old house on Empire Street for $145,000. It was a good deal, he said, because it sits on four lots.
The asking price was $220,000, but the deplorable condition of the structure – created by uniting two miners’ shacks from county ghost town Eureka and adding a second story – left room for negotiation, Wegert said.
He uses his job skills to repair the foundation, improve insulation and add aesthetic features. In the rear, he’s built a 500-square-foot greenhouse and a chicken coop heated with light bulbs powered by a solar panel.
A local broker sold Wegert’s house. But Realtors from the Durango area tend to focus their attention closer to home.
“I’ve sold one house in Silverton in 10 years, compared to 50 a year here,” said Denise Storm, president of the Durango Area Realtors Association.
Association past presidents Heather Erb and Don Ricedorff have similar opinions.
“It’s such a different market,” Erb said. “I stick to what I know well. I can’t comment on even Montezuma County real estate.”
Ricedorff said: “I showed a house there once. Beyond that, I know it’s a destination for people who want to live there or have a second home.”
Realtors who concentrate on San Juan County necessarily count on outside buyers. The county is the least populated in Colorado – the U.S. Census estimate in 2012 was 690 – and the federal Bureau of Land Management and the U.S. Forest Service own 89 percent of the land.
On a color-coded map of the county, the remaining 11 percent of land – much of it mining claims – forms a haphazard pattern reminiscent of a Rorschach inkblot.
The bulk of real property valuation is concentrated in Silverton, the Cascade Village condominiums and the small, gated Mill Creek community near the La Plata County line.
Numbers tell the market’s up-and-down story. The assessed valuation of the entire county this year is $41.6 million, down 13 percent from 2012, said Assessor Dan Salazar. Like assessors statewide, Salazar revalues property in odd years
Assessed valuation in 2005 was $40.6 million, but two years later, it stood at $55 million, the result of the flurry of activity that began in 2004. Although the economy tanked in 2008, there was enough momentum to boost assessed valuation to $58.9 million in 2009.
But the overall economy continued to flounder, taking San Juan County down with it. Assessed valuation fell to $48.9 million in 2011 and to $41.6 million this year.
Jim Lindeman, from his Coldwell Banker office in this town at 9,318 feet, said real estate in the county was stopped in its tracks when the economy tanked.
“We died,” said Lindeman, the only full-time Realtor in town. “There were several problems.
“There were too many people – relative to our size – who were speculating, and it got crazy,” Lindeman said. “Houses went from $100 a square foot in 2000 and 2001 to $200 a square foot in the boom years.”
Then came the crash. The price per square foot now is $100 per square foot or less, he said.
Annual residential sales figures provided by Salazar show how far the market fell. Sales in the early 2000s were in double digits – 30s and 40s and as high as 50 in 2005.
Sales in 2006 and 2007 – 19 and 20, respectively – perhaps were omens of things to come. Only two sales were registered in 2008. It’s gotten only slightly better since.
Average prices remained low in 2012, however, Ostlund said.
“We’re at the bottom of the market, so people who want to live in Silverton and people looking for vacation properties are looking for steals,” Ostlund said. “This is definitely the busiest we’ve been in three years, so I have high hopes for June through October, the ‘selling season.’
“By our estimates, consumer inquiries were down 88 percent in our office from 2008 to 2011 compared to the boom years of 2004 to 2007,” Ostlund said. “But last year seemed to be making a turnaround.”
Among the sales in 2011 were six homes at an average of $237,000 and two residential lots that brought $40,000 each. The homes averaged 550 days on the market.
Larry Gardner and Lorri Shields from Keller Willliams Realty Southwest Associates in Durango see San Juan County as a comer.
“We’re new on the Western Slope,” Gardner said recently of the Texas company. “But San Juan County is a neat, unique area that is getting attention on our website.”
The picturesque setting, adventurous skiing and the chance of new mining ventures and reopening the Silverton Northern Railroad line to Howardsville make San Juan County attractive, Gardner said.
“We’ll establish a presence in Silverton when it gets too busy to handle that market from Durango,” he said.
San Juan County Commissioner Pete McKay, who’s been around the county 20 years, recalls the cyclical nature of the real estate market, which was running full throttle from 2004 through 2007.
“Mining shacks were selling for as much as $250,000,” he said. “Some sold at asking price.”
The 2008-11 slump hurt, McKay said, but he sees the economic horizon brightening.
San Juan County is ready to inject itself into the housing market with ground breaking on a project six to seven years in the making, McKay said.
It’s the Anvil Mountain subdivision, 10 acres of affordable/attainable/market-rate housing near the intersection of county roads 2 and 10.
A little further out, the arrival of high-speed broadband Internet could spark growth not seen since mining brought hordes of fortune-seekers to the area in the late 1800s, McKay said.
“Broadband will give us access to the world,” McKay said. “Corporations or individuals who want to work from home can locate here.”