Government officials and housing organizations know the La Plata County housing market is a challenge for buyers.
On the ground, it feels like a housing war.
Alanna Forster, a first-time homeowner, faced lines of cars with prospective buyers wanting to view the same house. Katie Bay and other first-time buyers were outbid by cash offers that came in tens of thousands of dollars above asking price. And Jules Masterjohn had mere hours to commit to buying her new home, lest she lose it to another buyer.
“People are watching the market like hawks. As soon as a house goes up, they’re making an offer. You have to make your decision so quickly,” said Forster, 29, who bought a home in Durango. “You’re choosing a house you’ve seen once, and now you have an intense loan under your name.”
This is the second of a two-part series about the tight housing market in Durango and La Plata County. Part one examines how middle class homebuyers are being squeezed out of the market and what is being done to help reverse the trend.
An affordable home for someone earning $45,000 to $50,000 a year or less – office managers, landscapers, teachers, nurses – would cost between $240,000 and $360,000, according to city estimates.
Yet the median price for a home in Durango is $583,687 and in La Plata County it is $499,000. Both have increased significantly during a COVID-19 pandemic-related boom, up 21% and 13.4%, respectively, compared with the same time period in 2020.
To make matters more difficult, there is less than half a month’s supply of homes available in the market, said Durango real estate broker Rick Lorenz.
The city of Durango, La Plata County government, housing organizations and economic groups are working on studies and partnerships to address the housing challenges. But it could take months or longer to see results.
First-time homebuyers say they need help navigating the market.
“I was talking to a Realtor, and he said, a year ago, you could still get a home for $250,000 in Bayfield,” said Masterjohn, 63, a Durango resident since 1999. “Now, really everything is over $300,000. Even Bayfield is pricing people out.”
First-time homebuyers are met by a low housing stock, find that Durango homes are more expensive and lower quality than other areas, or they come to the tough realization they don’t have the budget to afford a suitable home in the city.
Masterjohn, and her husband, Steven DiSanto, 60, expected to continue renting in Durango – then their landlord decided to sell the rental house this year.
In February, they started searching for a home between $200,000 and $250,000 and immediately realized Durango was out of their price range. Their top choice: a home in Fox Farm Village, an affordable housing subdivision in Bayfield.
“We looked at this place on a Sunday at 10 a.m. At noon, we got a call from our buyer’s agent who told us, in that two hours, another offer had come in,” Masterjohn said. “We were suspicious that that was the truth. But we had two hours to make a decision about whether we even wanted to buy the place.”
Melanie Higbee, 42, a self-employed massage therapist, started looking for her first home in 2020. She wanted a condo, manufactured home, stick-built house – anything in her $250,000 to $290,000 price range within 20 minutes of Durango.
The “price wars” were just beginning, she said. She looked in Aspen Trails and Forest Lakes, but people were offering more than the asking price or homes were selling too quickly.
Forster, a senior account executive for King Energy, wanted a single-family home with three bedrooms and a yard in Durango for $450,000 to $600,000.
She found a line of cars waiting to see a $385,000, remodeled house outside of town in Durango West. That day, the house had multiple other offers, including a $450,000 cash offer.
There was an “extreme difference” between what they could get for their money in Durango versus Bayfield, she said.
“It’s like, this is insane because this house is selling for half a million dollars and look at what you’re getting,” Forster said, recalling a $499,000, uncleaned house with possible mold issues. “It’s kind of daunting – this is what we’re going to get?”
Bay, 23, an office manager at a local gutter company, wanted a three-bedroom house with some acreage outside of Durango for $315,000 to $330,000.
She and her husband signed up for daily alerts, but each time they found a house, it was either under contract or pending. In a few cases, houses were gone in 24 hours, she said.
They found a house in Dolores County and were verbally accepted. Twelve hours later, they dumped the Bays and took a cash offer.
It was heartbreaking, Bay said.
All four families eventually found a home – some after weeks of searching, others after months.
Bay bought a home for $340,000, about $10,000 over the listed price, overlooking Navajo Lake on the border of La Plata and Archuleta counties.
“The whole search in this crazy market was pretty eye-opening – just how quickly things can change in a time when you desperately need something,” she said. “The fight for a home was just so bizarre. Now that we’re settled, we’re very lucky to be on the other side.”
In Bayfield, HomesFund, a mortgage assistance nonprofit, guided Masterjohn and DiSanto through the income qualification process, offered expertise and gave them downpayment assistance. They bought their three-bedroom home for $219,900.
Higbee found a manufactured home for $243,000 near Elmore’s Corner east of Durango with help from HomesFund.
In Durango, Forster and her husband put in an offer for $560,000 on a home off Florida Road in Durango, then a competing offer came in immediately afterward. It was tense, she said. They beat the other offer and closed on their new home Friday.
“I think it’s pretty discouraging or almost impossible, for anyone who’s out of college and ... is working hard to even buy a house,” Forster said. “I just don’t even know how it’s possible for young people to get into the housing market, and I think that’s really sad.”
Higbee and Masterjohn said HomesFund resources made the difference; Forster said her Realtor, Kelly Kniffin, played a key role in her successful housing search.
But it would help to expand eligibility for down-payment assistance and to provide more buyer education programs. DiSanto wondered if local governments could develop policies to control the wide swings in the market, like allowing a 5% price increase each year.
“The continually rising costs of homes in the long run will have a negative effect ... on the livability and the friendly quality of life that I’ve experienced for lots of years living here,” Masterjohn said. “Honestly, I don’t want to live in a community where there’s a lot of people struggling. There’s enough for everybody to be happy.”