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Number of Durango home buyers 34 and under is declining

Despite market challenges, some young Durangoans have pulled off a home purchase

Durango’s housing market is competitive, low on stock and, to the average earner, overpriced, which can altogether exclude would-be buyers within some demographics – specifically, young people.

Last year, a Zillow analysis reported that the modern first-time homebuyer is an average of 33 years old, more likely to be single and renting for an average of six years before buying, compared to 2.6 years in the 1970s.

And a 2015 regional housing report published by the Region 9 Economic Development District of Southwest Colorado found that an annual income of at least $79,000 is necessary to qualify for a home loan in La Plata County. That threshold increases to $90,500 to live in Durango.

And yet 62 percent of Durango households and 54 percent of county households earn below those respective benchmarks, the study said.

With costs and the millennial mindset changing the home-buying culture, the “34 and under” pool of buyers has declined about 7 percent over the past 10 years.

But some young people in La Plata County have eluded both the money-eating rental trap as well as their parents’ basements.

Who is buying?

Kerry Melrose, who just turned 27, her husband, Skyler Melrose, 28, and their two kids just moved into their Bayfield home in May for $295,000.

Kerry, an elementary school teacher, and Skyler, a construction foreman, earn a combined $64,000 yearly.

The National Association of Realtors’ 2015 report indicated that 65 percent of buyers age 34 or under are married couples, 14 percent unmarried couples, 12 percent single women and 8 percent single men (1 percent of living situations were characterized as “other”).

Like other local real estate agents, Coldwell Banker broker associate Nicole Sorensen said she hasn’t worked with any young, single home buyers yet.

“Being a couple of course means there are two incomes being taken into consideration,” said Sorensen, who at 24 just bought a $170,000 home in Hesperus with her husband, Ben Sorensen, 25, who works for Balantine Communications, the owner of the Durango Herald. Between the two, their annual income is between $50,000 and $70,000, she said.

Where are they buying?

The Melroses’ Bayfield home was their second time buying; the first was within Durango city limits.

Buying in Bayfield not only saved them money but time.

Melrose said she and her husband searched for three months in Durango to find the right fit in their price range, compared to about 45 days on the hunt in Bayfield.

“It was much more difficult to find what we were looking for in Durango because prices are so high, and it’s hard to find a quality home we could expand in,” Melrose said. “In Bayfield, there’s more land, you don’t have to pay for water unless you go into the city, and it’s just smoother to look in the country than to find an in-town home.”

The most recent data from the Durango Area Association of Realtors show the median price for single-family homes is $353,450 in La Plata County, $415,000 in Durango and $286,500 in Bayfield.

Living in Hesperus, the Sorensens’ monthly house payments are $1,050, which is about $300 less than they spent on monthly rent living near Wildcat Canyon. But Sorensen said in her experience, some people are content to sacrifice homeownership for the luxury of living in Durango proper.

“They want to live in town, but they won’t find anything under $350,000,” she said. “They want to walk downtown or ride their bikes and don’t want to give that up, so they rent.”

How are they buying?

Robert and Devon Schmidt, both 26, left Durango for years to gain work experience and make money before returning to settle down.

The couple lived in New York, where Robert worked at fisheries for the state and Devon was a cost analyst for a railroad. When they returned in September 2015, they began house hunting and have their first one under contract in Durango West.

“We left and came back, which really helped,” said Devon Schmidt, now a county employee, said. “And when we did, we knew it was more important to us to live in Durango than have a bigger house outside the city.”

When they bought their first home, the Melroses had to clean up their credit, and have a parent co-sign.

“We just didn’t have the right credit scores at the time,” Kerry Melrose said. “We really focused on saving every penny we could.”

She advised finding a trusted inspector to look over the house, lest the buyer find it comes with a hidden and expensive catch: in her first house in Durango, Melrose said she had to take down two walls because the previous owners had stored dog food in them.

“People are scared,” Nicole Sorensen said. “Our generation doesn’t want to be tied down, and they don’t realize what they do in high school and college with their credit – that can hinder you in the long run.”

But what young buyers don’t realize, she said, is that if they talk to mortgage lenders, they may be able to find something affordable that’s the right fit.

“This market is very tough to compete in because the quality of what you can pay for is just not there,” Kerry Melrose said. “Everyone thinks they have a gem. It is very hard, and you just have to keep looking.”

jpace@durangoherald.com



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