Homeowners: now or never
Real estate not expected to come down anytime soon
September 1, 2007
Craig — Are there any potential homebuyers out there in Moffat County?
If there are, the advice from real estate agent Jerry Monger is to act now, because prices probably are not going to come down.
Monger, of All Star Realty, is handling the new Tri-Star subdivision development on the 900 block of Ninth Street. The 10-acre, 28 single-family home development is geared toward competing with the modular and resale home markets, Monger said.
Each Tri-Star home is projected to cost $245,000 and have three bedrooms, two baths and a two-car garage spread over 1,600 square feet.
“There are mostly no new spec houses being built around here except in the Overlook Park subdivision, and those are generally too expensive for first-time home owners,” Monger said.
There aren’t very many building sites left in Craig, and what is here can be very discouraging for young, lower-income people, Monger added.
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Mario Ayala builds houses and currently works as a subcontractor for Classic Homes.
He builds houses by day and looks for one to buy in his off time.
He has been looking for the past two years.
“The pricing keeps going higher,” Ayala said. “Every year it keeps going up. If last year a house was around $125,000, now it’s $200,000. It’s ridiculous. It’s probably because a lot of people are moving here from out of town, and of course there’s a lot of work here.”
Ayala’s plight is demonstrated across the valley, where steady economic growth has pushed property values to an all-time high, Monger said.
Megan and Steve Mudge just bought a new home for $163,000 through real estate agent Yvonne Gustin at Country Living Realty. They looked for about six months, Megan said, until finding a place they could call home.
“This was a starter home,” she said. “A place a we could make an investment and stay for a couple years and then sell it and get something a little bit nicer with the extra bedrooms where we can start a family.”
The Mudges wanted to make an investment and get out of their apartment where they paid their landlord too much rent, Megan said.
When they began the search for a house, Megan, a Craig native, knew the market would be high and 100 percent different than a few years ago.
“My dad bought an investment property about five years ago for $100,000, and he got twice the property we did,” Megan said. “You know, we have a smaller house, but it’s cute. It was all a little scary, but you have to take a chance.”
Robert Christensen moved to Moffat County two years ago with his wife, Shelly. Robert remodels homes, and is thinking about flipping houses because of the success he had in recently selling a home outside of Craig off County Road 105.
He and his wife sold a five-acre plot with a 2,800-square-foot home for nearly $100,000 more than he expected.
He and his wife sold it in two weeks.
“We were thinking $325,000 or $350,000, maybe,” Robert said. “It was kind of exciting. We really keep an eye on the market. I’m thinking about flipping a couple other small properties in the next year.”
The Christensens bought a house about the same size with four bedrooms and three baths for $234,000. They are now in the process of remodeling that one, as well.
“Most houses in Craig need an update,” Robert said. “Even the fairly new houses in Craig were built in the late ’70s and early ’80s and still have that ’80s style to them. There’s hardly been anything done to these homes since they were built. The hallway in my house now isn’t even three feet wide.”
The housing market situation is not unique to Moffat County; it’s happening all across Northwest Colorado, said Vicki Burns, real estate agent with Brass Key Realty, Ltd.
It has to do with oil and gas exploration and the wealth of good jobs in the area, she said. Moffat County also sees growth spill over from the huge tourist boom in Steamboat Springs, where some residents are moving because that area is too expensive to afford.
Other areas of Colorado and the nation are not faring as well.
Around the Front Range, there is a glut of available homes due to overbuilding and foreclosures on homes because of adjusting interest rates, said Jamie McAnally, of American Northwest Realty.
Interest rates were at record lows for the past three years, and a lot of realtors signed their clients into homes with adjustable mortgages, which are typically lower than fixed rates at the time of signing.
But interest rates have increased recently, leaving new homeowners with mortgages they can’t afford to pay, McAnally said.
For Denver, parts of California and other areas across the U.S., the increased supply of housing has driven property values down. In Moffat County, where housing is in short supply and demand is spiking, the end of the housing boom is not in the foreseeable future.
“The bubble might pop, sure, but I don’t see anything slowing down,” Monger said. “It’s not like the boom that happened when the power plant was built and people were sleeping in their trucks. This is the effect of a steady growth, and now market values are higher than they were in the boom. I think that’s good for the community as a whole.”