Vacation home sales rose sharply in 2013 across the nation as wealthy individuals again put money into real estate in the form of second homes, the National Association of Realtors said.
Vacation homes sales jumped 29.7 percent to an estimated 717,000 last year, up from 553,000 in 2012, the Realtors group said in a report released April 2.
“Growth in the equity markets has greatly benefited high net-worth households, thereby providing the wherewithal and confidence to purchase recreational property,” NAR chief economist Lawrence Yun said in a news release. “However, vacation home sales are still about one-third below the peak activity seen in 2006.”
There are some signs that the national trend holds true in La Plata County. Sales of Durango mountain area homes – many of which are vacation homes – rose 18 percent in 2013 to 86 transactions, according to the Durango Area Association of Realtors.
It was the fifth consecutive year of rising home sales in the Durango mountain market.
“We’re bullish about it,” said Chris Bettin, managing broker at Durango Mountain Realty. “We think it’s going to be a pretty interesting summer. The market continues to show some legs.”
The Durango mountain condo and townhome market peaked in 2005 with 173 sales and hit its trough in 2008 with only 48 sales. (The local association’s statistical category does not include single-family homes). That curve closely fit the national real-estate and financial markets, which took a sharp downturn in 2008.
“There’s actually quite a bit of pent-up demand,” Bettin said. “People have put this decision on hold for a number of years, since 2008.”
In 2013, dollar sales volume for Durango mountain condos and townhomes grew 28 percent, while average days on market declined to 291 days – about 10 months – down from 374 days in 2012.
The median price of mountain condos and townhomes sold fell to $126,000 in 2013, down 16 percent from $150,000 in 2012.
More inventory is on the way. Kogan Builders Inc. and Tierra Group LLC are building homes this summer in Twilight Cabins, across U.S. Highway 550 from the Durango Mountain Resort entrance.
Alix Kogan, president of Kogan Builders Inc., said he’s building two custom homes for customers in the DMR area.
“We’re seeing second homes at the mountain, mostly,” he said.
Last year, the resort began building a 10-unit duplex project, Tacoma Vista. Construction on that will continue this summer, Bettin said.
And in January, Purgatory at Durango Mountain Resort won county approval to subdivide lots for a 90-unit townhome development near the Gelande parking lot along the highway. However, resort officials said there are no immediate plans to break ground on that project.
The Region 9 Economic Development District of Southwest Colorado last studied the demographics of second homeowners in 2006. At that time, Region 9 found that 40 percent of second homeowners in La Plata County were ages 55 to 64, while 33 percent were 65 or older.
Other findings from Region 9’s study:
A majority of the county’s second homeowners were empty nesters – couples with children no longer at home.
Most respondents had owned their second homes for less than 10 years. They said they valued Durango’s scenery and surroundings, intended to vacation in the Durango area in coming years and liked the small-town atmosphere.
July and August were the most popular months for second homeowners to visit the Durango area.
Most indicated they would like to visit their second homes more often. Eighteen percent indicated they want to retire here or become a full-time resident.