Archuleta voters should not be surprised that property taxes, and property valuations have increased substantially in Pagosa Springs.
Unfortunately, many private investors paid cash for vacation homes, to work remotely, and to rent out properties as a short term rental (STR) investment when not visiting.
Fortunately only 35% of local investors are “locked-in” with extremely low mortgage rates. As such, the majority of STR investors can freely choose to sell an STR if the Average Daily Rate (ADR) is a disappointment.
In April, Team M-Squared provided a forecast for the local real estate market: https://thisispagosa.com/2023-q1-market-recap/
- The name of the game is still supply and demand.
- STRs do not increase demand (like one would think)
- About 65% of deals here are cash
- Interest rates don’t have as much of an impact here
- Demand is holding up better than supply
- Prices will likely rise over the summer (if supply doesn’t substantially increase)
I compared the April forecast to the most recent Riley Report (June 6, 2023) in the Daily Post.
Inventory (Supply)
Sold (Demand)
Many STR investors try to avoid the AirBnBust dilemma where the supply of STRs is in excess to the demand for STRs. One strategy is to purchase premium properties which can then be rented out as an STR which provides renters a superior unique rental experience.
Fortunately, with the local inventory (supply) now growing almost 200% faster per month than investor demand, it appears local affordability might improve over the summer.
Archuleta voters can now consider whether STRs do not increase demand (like one would think) …