market reports Archives - Teton Realty Blog

When is the best time to shop for Real Estate in the Teton Valley?

May 2, 2023 By Tayson Rockefeller Leave a Comment

The best time to shop for real estate in the Teton Valley is totally dependent on a number of factors, as well as the context of the question. When do we typically see most new inventory come to the market? When are sellers usually most inclined to negotiate? I’ll do my best to break these questions down by the numbers using historical data, but I have to first clarify; The best time to purchase real estate in the Teton Valley is when the property you are looking for comes available. I can’t stress enough in our small market the lack of inventory and new listings at any given time. Choices are always limited, particularly when it comes to specialty properties like those with property features like creeks, streams or rolling terrain – as well as homes with guest homes, unique features, or special locations. Buyer should always be in the habit of monitoring the market closely, and jumping on opportunities when they meet one’s needs. That does not mean that buyers need to jump on the first thing that they see, however.

Land

Historical data has been fairly consistent. May and June have been the biggest months for new listings every year looking back to 2018 (and beyond) with the exception of 2020, which I’ll toss out as a result of The pandemic. Listings almost always begin to ramp up in April, and numbers for new listings begin falling in September. Here again, it doesn’t mean that one should not pursue a purchase during any given month. If a listing comes available that meets a specific set of criteria that has been difficult to find, it should be pursued if the price is right and you intend to close on a property within a set timeline. When it comes to the listing / sales price ratio, the data isn’t quite as definitive. However, it seems to point to sellers being more negotiable during the off-season months, particularly October, November and December. Usually an increase in supply decreases demand, but Teton Valley’s peak tourism season is the Summer months, effectively increasing the demand along with the new supply.

Homes

Residential trends seem to trail land trends by about 1 month. Most new listings come to market late Spring and early Summer, with June and July historically being the peak months for the greatest number of new listings coming to market. New inventory once again dwindles during the off-season months, particularly late Fall and early Winter. Historic trends have shown that new listings tend to pick up once again through the Winter peak season, though new listings are far fewer than Spring/Summer. Once again, the data is not as conclusive when it comes to the listing price / sales price ratio with residential properties, but there does seem to be a trend that shows more negotiation during the offseason months, like we were able to see with land sales.

Summary
The data points to more options and greater inventory during the Spring and early Summer months, with more opportunity for negotiation during the offseason, particularly late Fall and early Winter in both market sectors. Source: Teton Board of Realtors – Teton Valley, ID & Alta, WY

What do you consider Peak season?

November 7, 2022 By Tayson Rockefeller Leave a Comment

One of the most frequently asked questions I get pertains to the seasons. I wear multiple hats around the office. Sometimes I provide insight for the property management team. Other times, I may be working the administrative or brokerage side of the business. In addition, and like any real estate agent, I’m always working “sales”. Interestingly, the property management side assumes that Winter is the big season, and the sales side customers assume Summer is the big season.

I’m not going to pull metrics to try to prove my point when it comes to rentals, I can assure you that the Summer months are the busiest. The property management team is reeling with PTSD by the time October rolls around, normally to be reminded of how much of a pain property management can be through the Winter months.

I can vividly remember researching this very topic on the sales side some years ago and determining that there were more sales that Winter season than the Summer prior. This instance most certainly occurred post 2008 and pre-2020, and I don’t recall any volatile years in between. That said, I can also distinctly recall dozens, if not hundreds of instances where home or land sellers discuss taking listings off the market as winter approaches, with the strong opinion that things do indeed congeal as the temperatures drop.

Okay, enough already. Here are the stats. I’m working off of the Teton board of realtors MLS and including all of the areas served (Teton Valley, Jackson, Alpine and surrounding areas), and I am not breaking this down by property type (give me a break, it’s 11:00 p.m. on Sunday). Also, I’ve decided to base Summer sales on June 1st through November 30th, and Winter December 1st through May 30th.

2018
Winter sales: 788
Summer sales: 1,146

2019
Winter sales: 711
Summer sales: 1,177

2020
Winter sales: 686
Summer sales: 2,255

2021
Winter sales: 1,676
Summer sales: 1,782

2022
Winter sales: 1,151
Summer sales: 894

There you have it. 2022 is obviously an anomaly with a changing market on the heels of the post covid real estate craze, as was likely my aforementioned vivid memory – unless it’s not a memory at all… At any rate, just because there are more sales that occur during the Summer season, does not mean that homes should not be listed for sale during the Winter months as 2022 easily illustrates. Further, more sales does not necessarily equate to a higher sales price. Often competing with less inventory in the Winter can benefit one looking to sell.

How do we value your property, and how do we arrive at a recommended price?

July 23, 2022 By Tayson Rockefeller Leave a Comment

Good real estate agents need to have a variety of unique skill sets and be prepared to wear many hats. Professionalism amongst our customers and peers, a skill set with respect to marketing is important, an understanding of technology is key, a general understanding of construction, home maintenance, familiarity with their area of service including government entities, code, zoning – the list goes on. One often overlooked skill is understanding the basics of appraisal (though we are not appraisers) and valuation when it comes to market data, how it conforms with the local area and it’s nuances, different valuation methods and tying it all together with absorption data and recent sales.

Most real estate agents use a comparable sales method of valuation. Basically, we look at recent sale data (that usually only real estate agents in the area have access to), and form an opinion of value based on that data. However, it runs deeper than that. Not only do we need to find the most appropriate data, but we need to make adjustments based on unique attributes of the property we are valuing. In addition, we need to look at market conditions, including absorption.

Absorption is usually calculated by looking at the number of sales in a specific time period as well as the current supply. As real estate agents, we generally measure absorption by the number of months’ supply of inventory in that particular sector of the local real estate market. We then have to look at trends to understand if the amount of supply is likely to increase, or decrease in the coming months as we begin marketing your property. It’s easy to get caught up in markets. Most recently, we saw unprecedented demand and historically low supply. We need to take this into consideration when we value property, and it’s hard to convey this information to the public. Sellers want the highest price possible. The public needs to understand that it is our job to obtain this. We have a professional duty to do so for those we represent. This is why it’s so difficult to explain changing market conditions, particularly when things are slowing. As an example, we might look at comparable sales from the past 6 months, which were historically high. Not only do we need to make adjustments for the specifics of the property we are valuing, but we also need to take into consideration the changing market conditions and the increasing supply as mentioned above.

Now, let’s take a deeper dive into absorption as it relates to valuation. If we had one month’s worth of supply (a very low number) 5 months ago, four months’ of supply today and the market conditions are indicating we may have even more in a few months’ time, we also need to manage expectations on timing. Essentially, if we absolutely nailed a valuation and properly account for changing market conditions to the best of our ability with predictions and market indicators, the home should sell at the then calculated absorption time. In other words, if on the date of sale the current absorption is about 6 months’ worth of supply, and you were on the market for 6 months, everything tied together properly. Do we want to take offers in advance of that? If it’s the right offer, absolutely. If things take longer what’s going on? Well that’s an indication that the property may be overpriced. The challenge with this? Teton Valley is very seasonal in terms of its peak sale seasons. If we wait 6 months to learn that a listing is overpriced or agree to list at a higher number because our client asks us to do so, we spent quite a bit of time on the market with conditions that are indicating a slowdown. These are the risks of pricing without basis, or based on ill advice. To summarize, it is always in a Seller’s best interest to find a professional in the marketplace (any marketplace), that understands all of the aforementioned nuances to the real estate industry. A great marketing agent that doesn’t understand local trends is not necessarily a great agent at all. In addition, it’s easy to get caught up in crazy markets, and it’s even easier to enter into a phase of denial when hoping to capitalize on your investment, which should be everyone’s goal. Take your real estate broker’s advice if they have a clear understanding of the market if it is in fact your intent to sell at the highest price.

Price Reductions, You’re Doing it Wrong

July 13, 2022 By Tayson Rockefeller Leave a Comment

Who’dve thought we would be discussing price reductions today, with such a crazy market just yesterday. First.. Am I indicating that prices are falling and it’s a buyer’s market? Not necessarily. We are however seeing market stabilization, but some sellers aren’t ready to come to those terms just yet. We are continuing to see listings surge on with new listing prices 5-10% over the last quarter. Many of these listings are sellers that don’t want to leave money on the table, understandably so. The market is moving directions quickly, and none of us want to leave money on the table. In addition, some sellers are listing with “make me move” prices, and there is nothing wrong with that.

With the above said, don’t put yourself at a disadvantage, particularly if selling is a priority, and not just something to take advantage of if the price is right. If your motivations are the former, take a hard look at an analysis provided by a broker to see if it makes sense. As the market stabilizes, many brokers and brokerages are finding themselves with too much overhead and two little selling inventory, which may result in taking listings with unrealistic listing prices, or even providing unrealistic advice, though I hate to admit that it would happen in our community, as most of my colleagues and competitors are, in my opinion, some of the best in the Nation.

Notwithstanding, if you do find yourself in the position to reduce price, do it based on data. In many events we are seeing “panic” reductions, and in some events for properties that are appropriately priced. We all have concerns about the selling season, but don’t reduce too soon.

My second tip, only reduce once. Multiple price reductions lead the market to believe that they should wait for the next reduction. I understand that we don’t know how many times you may need to reduce, hence the need to look at the data closely. Unfortunately we aren’t currently in a position where reducing too much will bring the sales price back over the market value. Regardless, you need to act carefully, but not (too) quickly. Price reductions should be concise, well thought out, and substantial enough that you only do it once – but not so much that you leave money on the table. A good real estate agent will help you plan the starting price appropriately, and provide the data as to how they arrived at the suggested price in a comprehensive way that is also easy to understand in order to make an informed decision.

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