On May 18, 2022

Ruffles and ripples in Rutland real estate

By Jacob Pluta

Editor’s note: Jacob Pluta is the principal broker of White Cap Realty and a board member of Rutland Young Professionals.

From 2014 to the present day, Vermont’s real estate market has swung from a sluggish buyer’s market to a frenzied seller’s market. I became licensed to sell real estate in Vermont in 2014. That year, I sold two houses, one of which was to my parents. At the time, foreclosure sales flooded the market; this dragged property values down, and pairing the totality of distress sales with weak purchasing demand, the average residence took roughly 200 marketing days to sell. It felt like a race to the bottom, with buyers having incredible power to demand lower prices and favorable terms. Since then, our state’s housing inventory —the number of homes listed for sale — has plummeted. Across the state, it is firmly a seller’s market for residential real estate.

If we look at the year 2022, the numbers are striking. According to the Vermont Association of Realtors (VAR) February 2022 Market Data Report, we have only 1.8 months of inventory, meaning that at the current pace of sales, it would take only 1.8 months to sell the entire current housing stock of Rutland County. A balanced market has around six months of inventory; less than six months tends toward a seller’s market, while greater than six months indicates a buyer’s market. By all measures, the residential real estate market favors sellers.

Vermont’s market felt like it was heating up before the pandemic, but it has caught fire since the pandemic. Prices are way up; referencing the same VAR market report, the average listing price in Rutland County was $500,076 for February 2022, up 14.3% year-over-year alone. (Median listing price of $302,121, up 20.9%.) The average sales price was $341,665, up 23.9% year-over-year. (Median sales price was $245,080, up 24.5%.) Meanwhile, the median time a listing spends on the market has decreased to 53.8 days.

My personal experience brokering Vermont real estate mirrors what this data illustrates. Over the past eight years, I resolved to specialize as a buyer’s agent. Instead of securing listing agreements— where a seller agrees to have my brokerage market their property for sale — I concentrate on meeting prospective buyers and ultimately acting as their agent searching for a new property. When I began in 2014, a buyer could seemingly look at properties endlessly, only to come back to the first one they looked at with a good chance it was still for sale. But at present, there is tremendous demand to buy, with few property owners opting to list properties for sale. Buyers may compete against a dozen or more parties for the same property.

Growing up in the Rutland area, I am simultaneously encouraged and concerned by refreshed interest in housing across our county and state. More people living here and spending time here means more commerce and more revenue for local businesses to reinvest in the local economy. Indeed, according to the state, receipts of meals and rooms taxes for March 2022 were 21.92% above forecast. As a former coffee shop owner, I hear the cash register opening in my mind. As a current consumer, I see the payment pad swinging around for me to leave a tip and sign for my purchase. But what about affordability? What will businesses do when their essential workers do not earn enough to afford a mortgage on the average home in Rutland County? I moved back to the Rutland area because the barrier to entry for brick and mortar entrepreneurialism was lower than in Burlington. But now, it seems the cost to live here is a massive barrier to entry if you are just getting started. These are big, complex problems, and we are not alone. Let us look out for each other and do our neighborly best. Sound good?

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