Charlie Hill, Cordillera Ranch Development President
Just when we thought the red-hot real estate market couldn’t get any hotter in 2020, December arrived and sales activity surged even further and continued into early 2021. By early November, home inventory had dropped to a 15+ year record low of only 12 homes available in MLS, approximately 75% below the historical average of 45 to 50+ homes on MLS in recent years. That shrinking supply seemed to create more of a buying frenzy in the last two months of the year, reducing the inventory of available homes on MLS to only four as of mid-February 2021. So, let’s take a quick look back at how we got there with a few highlights of 2020 sales data for Cordillera Ranch.
After a drop in sales activity during the 2nd quarter of 2020, home sales (closings), excluding custom home starts, surged in the 3rd and 4th quarter to end the year with 63 total home sales — a 17% jump from the prior year. Two-thirds of the home sales occurred during the final six months of the year.
The average home sales price in 2020 increased 10% to $1.33MM (only including resale and spec home sales) with an average price per square foot of $262/sf. The average price per square foot in the 4th quarter jumped 14% over prior year to $309/sf (again this does not account for current custom home construction costs). The chart to the right illustrates home sales price per square foot by quarter.
Consistent with years past, the majority of the home sales activity occurred in the Ranch community (83%) followed by 13% of sales in the Clubs Village area. Cordillera Ranch Realty was the leader in sales activity during 2020, accounting for nearly 30% of the home sales (as buyer agent) in the community, well ahead of the next closest broker.
Lot sales (closings) in 2020 surged 28% versus prior year to 77 total sales (including resale and developer lots), and 58 (75%) of those sales occurred in the 2nd half of the year, almost equal to the total sales for all of 2019 (60). In the final two quarters of 2020, total lot sales nearly doubled the lot sales for that same period in 2019. That end of year momentum accelerated further the last week of the year and into 2021 as we had 8 lots contracted during the final week of the year and another 23 contracted in January and another 23 in the first two weeks of February.
The average lot sales price increased 9% in 2020 to $274k, but as always lot sales prices vary widely based on property attributes, location and size. The Clubs Village area averaged $365k per lot (which includes non-golf course lots) and the Springs and Ranch community averaged approximately $220k per lot. The chart to the right illustrates the average sales price per lot over the past three years.
The Springs of Cordillera Ranch and Clubs Village were the hottest neighborhoods over the past year, with 29 and 30 sales, respectively, in those two areas and were followed by 18 lot sales in the Ranch community.
CR Realty accounted for 62 of the lot sales in 2020, representing an 81% market share. CR Realty agents took the top five spots in terms of overall lot sales by agents in 2020, with Charles Mueller handling 32%, followed by Vance Waller at 18%, Carey Yeager at 14%, Barry Denton at 10% and John Kuhry at 7%.
Overall, the strong sales activity has continued into 2021 as we’ve had two record months of total sales to start the year, with 53 properties already contracted in the first 45 days of the year (which only includes CR Realty sales). A variety of factors have driven the surge of buyers and the encouraging news is that this hot market appears to be different from the mid-2000’s when much of the activity around the country was fueled by investors and speculators. Generally speaking, we’re seeing “end-users” — people purchasing lots and homes for their personal use as opposed to just investment purchases. The number one reason we have seen the push of activity has been people from around the state and country seeking better quality of life overall, including lower taxes, a more business-friendly environment, more lifestyle activities for the family and more open space to enjoy. People were clearly seeking to escape the lockdown-driven claustrophobic life in the city, and Cordillera Ranch has been a good answer to those desires. Based on the extremely tight supply of homes (4 homes available with a starting price of $1.1MM; or $2.9MM for anything on 1-acre or more), the current trend of strong lot sales is anticipated to continue for 2021.
The Cordillera Ranch Realty Team can be reached at 888.66.RANCH.