Durango real estate is showing positive signs of life. As a builder, I follow the market for business purposes of understanding supply and competition. As an employer and community member, I’m interested in how the numbers help to gauge the economic strength and resiliency of our area.
My educated (and admittedly optimistic) opinion is that things are looking good for Durango and La Plata County, both with home sales statistics and new home starts. Downtown Durango remains the most consistent, while other areas of the county are slower to achieve stabilization. We’re certainly not at pre-recession confidence, but we seem to be moving toward more sustainable numbers for our community.
Existing Home Sales: Sunday’s Durango Herald reported that the median home price in all of La Plata County rose 2.58 percent in Q2 2011 over the same quarter 2010. Good, if not spectacular, news for sellers. Homes in downtown Durango saw a jump of nine percent in the same period. Condos and homes in outlying areas were down in price.
Better news for the entire community is the number of homes that are selling. There was a net gain of eight homes sold in January to June 2011, compared to the same period 2010. Condos, country homes and Bayfield in-town homes were down. Durango, Bayfield country homes and resort homes were up.
Local Housing Starts (as determined by permits issued): There’s a two-fold reason why housing starts are a nationally reported statistic and leading economic indicator. As a leading indicator, construction is one of the first industries to grow at the early stages of a business cycle, and one of the first to show reaction from a change in the Federal Reserve rates. Objectively, the building and construction industry employs a high number of people, from entry level to highly skilled craftspeople. Additionally, the goods and materials required to build even a single home can be a substantial marker for a regional supplier. The subjective side reflects the psychology of deciding to build, rather than buy a pre-existing house. Building a new home is associated with optimism and a confidence in the market.
If the subjective argument holds water, it appears Durangoans are feeling quite positive about the future. According to the City of Durango Permit Office, 23 permits were issued for new, single-family residences from January to the end of June 2011. The same time period in 2010 saw just 14 permits issued for new single-family residences.
Interestingly La Plata County numbers didn’t change. There were 41 permits issued for single-family residences from January to June 30, 2011 – the exact same number as were issued for the same time period in 2010. These figures include all of La Plata County, except Durango, Bayfield and Ignacio.
As always, I’m available anytime to discuss ideas and answer questions about your building project.