The price has been right for entry-level Jackson Hole homes in recent months, with the inventory of properties listed at or below $300,000 decreasing by 28 percent to 28 units since the beginning of the year.
It’s possible the inventory in this market segment peaked in late December, when there were 39 units listed below $300,000, a benchmark I’ve written about many times in recent years. The price is significant because at the height of the Jackson Hole real estate bubble, not a single residence in Teton County was listed below that figure and in 2008 there was not a reported sale below $300,000.
During the last 12 months, 41 of the 274 (15 percent) residential sales in Jackson Hole were below $300,000. Closed sales in 2012 have remained on pace, with 10 of the 62 below $300,000. However, 12 of the 55 (21 percent) pending listings in Teton County are listed below $300,000 with 54 percent of properties under contract listed below $400,000.
The demand is not hard to understand. Finally, the costs of home ownership are again comparable to renting a similar residential unit. Interest rates are rock bottom, with a 30-year mortgage on $200,000 at 4 percent resulting in a monthly payment of about $950. Few 2-bed Jackson Hole homes rent for less than $1,000.
Supply, however, may become a problem. Many of the listings at the very bottom of the market, most of them bank-owned, saw multiple offers and short days on market. But foreclosures are waning in Teton County. And with prices stagnant, so is the amount of equity sellers. Contributing to inventory, however, will be additional short sale properties.
A lack of supply has already had a dampening effect on the upper end of the Jackson Hole home market. Sales of high-end homes above $1.5 million carried the market in the early stages of the current economic recovery, but that inventory has shrunk considerably in the last two quarters.
Year to date, 27 percent of residential sales have been above $1.5 million, a figure that often represented a monthly average sales price in the heyday. (In fact, the average sales price for the entire year of 2010 was approximately $1.4 million.) Just 6 percent of sales have been above $3 million, however, a market segment that saw a 13 percent decrease in inventory in 2011.
