Montrose Market
The real estate market in Montrose experienced yet another month of confusing and seemingly contradictory happenings. Prices staying steady, and going up, while sales volume continues to plummet to historic levels. Our buyer’s agents who are on the phone with buyers every day and searching high and low for housing options comment often on how available inventory is suffering significantly, causing many buyers to postpone plans until the new year. At the same time, a quick look at the last 3-4 years shows inventory in Montrose slowly creeping up and days on market increasing. Inflation remains stubborn and sticky. Some are forecasting that if we could get interest rates down around 6%, the housing market would begin to thaw from its near 2-year slump. How can we make sense of all of this?
As much as we’d love to say that we have the answers, we don’t! And anyone claiming to have a handle on what the economy and real estate market is doing right now should probably be taken with a grain of salt. Still, some interesting developments regarding our local market are worth mentioning.
A few conversations with builders this month, as well as a brief study of MLS data shows a high number of what we call ‘ghost’ listings. These are essentially vacant pieces of ground where a builder can build you a spec home with varied levels of customization, and in some cases the idea is that the buyer would even carry the construction note or pay cash. Builders’ tolerance for risk, at least in our local market, is very low.
Another leading indicator that we monitor closely is under contracts, which experienced a very slow November. Yet, these numbers follow trends from the last few winters in Montrose. Typically the real estate market hibernates starting approximately in November and things start to open up around March/April. The concern here is that we are now on a 2+ year trend of consistently slowing sales volume, which can have a host of consequences over time (realtor attrition being one of the main results).
Another, more abstract concept affecting our market is what we refer to as buyer sentiment. Between the transition of our country’s leadership and the unknown ripple effects, to higher interest rates and inflation combined with sub-par options for buying a house even if you wanted to, we are seeing buyer hesitation at higher levels than in recent memory. It seems the ‘good old days’ of 3% rates and a skyrocketing stock market are not far enough away out of our memory to embrace what is real now and could likely be the scenario we find ourselves in for the foreseeable future.
National Real Estate Market
If you read our stats post last month, you’ll recall comments made by the National Association of Realtors President forecasting a very rosy picture of the housing market in 2025. Fairview Commercial Lending as well as the Wall Street Journal identified the lack of any serious data or reason to believe these claims just as we stated. Anyone who takes a deep look into the housing market sees massive roadblocks to this unrealistic scenario in the form of still-high interest rates (relative to affordability) combined with low inventory and sticky inflation.
Click Here to View Residential Sold – November
