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The Teton Valley Market: Where it’s been, Where it’s going

September 3, 2016 By Tayson Rockefeller Leave a Comment

The Teton Valley Market: Where it’s been, Where it’s going: September 2016

I’m not going to say that nobody saw the downturn coming in 2008. We were all going crazy. Most of us that thought it might happen? We were ignoring it. We were too busy. It did though, and like our grandparents before us, many of us think about it today. To me, it was yesterday. Sure, recovery is still a commonly used term, even though (by all appearances) our market is recovered. Sort of.

I’ve read a few recent articles. One was a few months back by a group in Jackson and Jonathan Schechter, “Our mess will fuel suburban growth”. Jonathan was referring to his expectation for Teton Valley’s continual growth as the housing market, and frankly the available land on the other side of the hill tightens it’s grip. This article, and a few like it sparked several rhetorical articles and comments from those all too concerned with our sudden growth spurt. This group was concerned with the amount of growth we saw leading up to the recession, and the possible ramifications of too much growth all at once.

Personally, I don’t think things are growing too fast. We’re not seeing a large amount of construction, virtually no development, just market recovery and prices continuing to rise. By all appearances, home prices are on par with years leading up to the recession, if not close to pre-recession levels. However, this is not taking into account inflation or construction costs. Believe it or not, the recession began nearly a decade ago. Times were different. Construction costs were less expensive than they are now, and the housing situation in Jackson is worse than ever before.

The relief comes in land prices. Pre-recession, some developers made out like Bandits. They got in while things were hot, and got out before they were not. Some lost their hide. Lest we forget many locals who’s lives will never be the same after risk, and no reward. Bankruptcy, short sales, foreclosures, it was a mess. I mentioned relief. Though these terrible things happened to good people, and bad people, it is all behind us. We now have a huge inventory of available, developed land ready to be put to good use in the coming years, and possibly, decades. No, it’s not going to be a thousand years like some predicted throughout the recession. I remember 3 acre parcels selling at $200 to 300,000 – it’s where the big money was. Now that those same lots are under $100,000, it makes inflated building prices manageable, and the whole situation more affordable. With the huge inventory, supply and demand is not as much a factor (unless you get into supply and demand of niche locations) and Teton Virew lots a-plenty.

Where’s it going?

With the above said related to current building costs, it is my prediction that I can make an educated guess on where the market is, in relation to where it’s going in the near term. I believe that residential is nearly fully recovered, though we can expect annual growth with regards to real estate and it’s investment properties related to inflation and growing populations. Land, unless in areas of high demand where those with disposable income can comfortably spend more such as resort areas or River front properties will continue to grow, though only slowly until supply is diminished and there is renewed demand. I believe an indicator where we will need to recognize a market approaching dangerous levels will be an explosive jump in land prices. Am I saying we should prepare for another major housing collapse at that time? Not necessarily, but remember Real Estate is cyclical, and even more so in resort areas. Cycles, or slight market adjustments over time are actually healthy in some ways.

Where it’s been:

Since I tried to depict scenarios for both the short and long term foreseeable future, here’s a bit of information as to where the market has been. I selected two quality subdivisions, and found a home that sold pre-recession, during the recession, and recently. The first, Brookside Hollow – a popular, quality development in Victor, ID an area in Teton Valley reliant on recreation markets including our own, and Jackson Hole. The second, Comore Loma – a quality, scenic development along the foothills overlooking Ammon, ID (Idaho Falls) an area with low unemployment reliant on local commerce, business, regional hospitals, and the INL technology site.

Comore Loma, Ammon ID

April, 2005: $181,000
February, 2008: $208,500
February, 2014: $185,573
January, 2016: $210,000

Brookside Hollow, Victor ID

January, 2006: $396,000
July, 2012: $198,000
December, 2015: $350,000

Looking at the information above, it becomes obvious that recreation markets obviously see a larger depression in housing crunches and times of economic distress. If I gave you the numbers of the sales prices and the years sold for the home in Ammon, you probably wouldn’t be able to match them up. The market, though they saw a depression, was far less volatile. The Victor market (remember these homes are somewhat comparable) is much more lucrative, however.

The moral of the (my) story for the analysis above is that both markets appear to be sustainable in time, if you can live with the ramifications of a housing collapse in a recreational area.

July ’16 Market Stats

August 8, 2016 By Tayson Rockefeller Leave a Comment

We are seeing continued growth in the Teton Valley and surrounding areas. The average sales price for a single-family residence in Teton County Idaho during the month of July was over $365,000. This is a stark contrast to the average sale price throughout the recession.

Another surprising statistic is the number of building sites under contract and sold throughout the month of July 2016 in Teton County Idaho alone. With 21 building site sales last month, and 21 pending sale, that’s nearly what we saw sold throughout the entire year in 2011 at only 52 sales. 2010 produced exactly the same number of sales as 2011, just 52 land sales. Past 12 months sales are currently at 204 sales.

Why do listing agents always seem to attend showings here?

July 28, 2016 By Tayson Rockefeller Leave a Comment

Notice how I worded the question above, and not “Should listing agents attend showings”. The reason is that I often hear this question from prospective buyer customers, or, customers working with another broker while I am attending a showing for one of my listings. If you only have had experience with real estate in the Jackson & Teton region (including Alpine & Star Valley) you are probably used to the fact that there will very likely be 2 agents at a home showing. The listing agent, and the agent working with the buyer. It’s a way of life out here, whether it’s a 100,000 dollar home or a 1 million dollar home.

If you are not from the area, you may have had a different experience. In the Snake River area (Idaho Falls etc.) all of the agents pay a monthly or annual fee to have “infrared key access” in the form of a card, or even a smart phone application. There might even be instructions on the listing that provides contact information to the occupant in which case the agent can call the occupant directly, whether it’s a tenant or the home owner. In areas like Malibu, it is expected that listing brokers attend showings only for higher dollar listings, but not all showings.

This can go both ways I suppose, what about buyer’s agents not attending showings, for instance – ahem – buyer’s working with an agent in another state (maybe a state just East of Idaho?) that can’t attend a showing for a home their customer wants to see on the Idaho side? Would it be acceptable to just send them over and let the list agent take care of it?

OK, so maybe the last example is clearly not the right thing to do, but there are very different ways of doing business throughout the united states, and Canada for that matter. Here, some feel that we are held to a higher standard as we are members of the same MLS as the high end Jackson listings. So… to attend, or not to attend, the pros and cons weighed below;

To attend! (pros):

From a seller representative standpoint, there are some definite pros here IF the agent is timely, knowledgeable, and helpful with important facts about the house without being overwhelming. Also,it may be that the Seller hired the list agent specifically from a trust standpoint – someone to look after the home, lock all doors, keep an eye on personal belongings, and so on. After all, a buyer’s agent on a home tour of 8 homes might have a hard time keeping track of everything.

To not attend… (cons):

Some buyers (specifically from areas where they are not used to 2 creepy real estate agents following them around) feel that it’s strange to have the listing agent present at every showing. Admittedly, it can get a bit overwhelming. “OK all, our next home we will be meeting John with ABC realty” (long introductions etc.). John goes about explaining everything I explained in the car – or here’s a good one; My customers walk in HATE the place, would prefer to walk back out but John sucks us into a long description of the home, the sellers, the neighbors, the area, where he was raised, his favorite local restaurant, 15 reasons to move to Teton Valley… you get the idea.

Summary

In the opinion of most her locally, the pros outweigh the cons, attend all showings. At the end of the day, however, it is up to the listing agent, and the seller. This is a discussion that needs to be had with the seller and the list agent. My advise? First, ask the seller what they prefer. Maybe the seller remembers the time when they were once buyers and John from ABC Realty gave them nightmares for the next 6 months. Or, maybe during their last home sale they discovered personal belongings went missing after a showing. The suggestion I make to my clients? If you would like me to attend showings, that is what I shall do. In the event I cannot (there is only one of me) allow me to put a combination lock box on the door. This has allowed for last minute showings that have produced contracts.

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