Hello From Beautiful Pagosa Country!
As I look out my window this morning, there are no clouds – just blue skies! The weather has been gorgeous, if you enjoy warm temperatures without rain or snow. Today it is supposed to get up to 65 degrees, which is about 15 degrees above the average for this time of year. There is still no snow in the mountains. Last year, Wolf Creek Ski Area was the first in the nation to open. Hopefully, this year it will be open by Thanksgiving.
It’s either a feast or a famine around here! Two weeks ago, we had historic flooding. We had the third and fourth biggest floods in Pagosa history. I’ve seen estimates of $26 million in damage. The San Juan River was way outside its banks through downtown. The good news is there was no loss of life. Now the Town and the County are working with various Federal and State agencies looking for grant money to repair the damage.
The other big story downtown is we are getting close to completion of the first phase of the highway construction project. Half of the roadway has been closed through town as they rebuild the highway out of concrete rather than asphalt. They are also putting in new utility infrastructure and new sidewalks. This portion of the project is scheduled to be completed by December 14.
The whole roadway should be re-opened for the ski season, and next spring they will finish the job. But at least we’ll be open for the winter!
Now for the latest real estate news. The total number of real estate transactions so far this year is down 7% compared to last year. We’ve had 549 sales compared to 592 last year at this time. Home sales are down 5% with 261 this year versus 275 last year. Condo and townhome sales are up 5% with 61 this year compared to 58 last year. Vacant land sales are down 11% with 216 this year versus 243 last year. Residential inventory is up 22% with 221 homes on the market today compared to 181 last year at this time. Condo and townhome inventory is up 16% with 43 this year versus 37 last year. Vacant land inventory is down 1% with 346 this year compared to 349 last year.
Among home sales, the higher price categories have been hit the hardest. Sales of homes above $750,000 are down 19% so far this year. Inventory is up 48%.
We’ve seen a stark difference between the first part of 2025 and the latter part. Total sales in the first quarter of 2025 were up 18%. But since April 1, total sales have been down 16%.
Now for some good news. Interest rates have been trending down. As of today, a 30-year fixed-rate mortgage is at 6.34% and the 15-year is at 5.82%. About two weeks ago, the Federal Reserve reduced the prime rate rate for the second time. The day before that happened, a 30-year mortgage was at 6.13%. Now it is 6.34% This can be confusing – the prime rate went down, but mortgage rates went up. The Fed rate and the bond markets are at odds with each other at the moment.
We are expecting another prime rate reduction in December. I’m hoping to see mortgage rates close to 6.0% by the end of year, and I’m expecting 5.5% in the middle of 2026. If that happens, I expect the housing market to take off.
In the meantime, if you are a buyer looking for a good deal, the time to act is now. Most sellers are very motivated this time of year. If a property is listed, the seller is not looking forward to holding it through another winter. They are usually ready to wheel and deal.
So long for now! I sure hope that Congress gets their act together soon to get the government back up and running again. I don’t know about you, but I’m sure tired of listening to everybody blaming the other side.
Pagosa Springs real estate agent Lee Riley has regularly been one of the area's top selling Realtors® in recent years and offers a wide selection of real estate facts and information on his web site at ISellPagosa.com