The Cost of Living the Dream: Steamboat Springs’ Housing Market in Perspective
11/21/2024 02:35PM ● By Haley Watkins
Photo: a downtown Steamboat Springs home on Spruce Street. By Elisa Maines.
Earlier this year, The New York Times published an article titled, "Where Are America's Most Expensive Towns?" It highlighted Steamboat Springs as the fourth most expensive micropolitan area in the country. The article sought to answer a pressing question: Are smaller towns truly more affordable than big cities? To delve deeper into this topic, Steamboat Magazine staff writer, Haley Watkins, spoke with local real estate expert, Sue Stempel, of The Group Real Estate. Together, they explored the key factors influencing Steamboat Springs’ real estate market and examined whether our small town is as “affordable” as it seems.
Steamboat Magazine: Steamboat Springs is renowned for its ski resorts and outdoor recreation. How has the demand for homes in the area changed in recent years, especially post-pandemic?
Sue Stempel: The demand for homes in Steamboat Springs has skyrocketed, driven by the rise of remote work, a desire for outdoor access, and less dense living conditions. The pandemic intensified this trend, as people sought refuge from metropolitan areas. Historically low interest rates initially made smaller towns like Steamboat appealing, but this surge in demand quickly depleted supply and sent prices soaring.
SM: It’s often assumed that buying a home in a small town is less expensive than in a metropolitan area. Does that hold true for Steamboat Springs?
SS: While this was once true, the dynamics have shifted dramatically. To reference The New York Times article, a 2022 study ranked Steamboat as the fourth most expensive small town, with a median home value then at $691,800. That climbed to $1,110,750 in 2024, more than seven times the median income here. When compared to metropolitan areas with similar home values, like San Diego, Steamboat is slightly more affordable but only marginally. The assumption that small towns are inherently cheaper no longer applies, especially in resort towns like ours.
SM: What’s driving these steep price increases? Is it mainly locals or external demand?
SS: It’s a mix. The demand for vacation homes and rentals has had a significant impact, but so has the migration of people seeking permanent residency for the lifestyle Steamboat offers – recreation, good schools and a strong sense of community. These factors make Steamboat desirable, but they also exacerbate housing challenges, pushing prices higher.
SM: How do Steamboat’s home prices and affordability compare to other resort towns, like Aspen or Jackson Hole?
SS: Steamboat’s average home price is currently $1.34 million, which is “affordable” compared to Aspen at $2.7 million or Jackson Hole at $3.3 million. But affordability is relative. For locals earning a median income of $93,280, Steamboat’s price-to-income ratio of 7.27 still makes it challenging to buy. It has more than doubled in the last five years and more than tripled in the past 10. Many residents have been priced out and are having to move to more affordable areas.
SM: Are there areas within Steamboat Springs where housing is more affordable?
SS: Outside city limits, housing becomes more accessible. In towns like Hayden, Oak Creek and Phippsburg, median home prices hover around $585,000, significantly lower than Steamboat’s $1.34 million. Properties with less than an acre of land in these areas are especially more affordable.
SM: Are there any local efforts to address housing affordability?
SS: Yes, several projects aim to tackle the issue. The Yampa Valley Housing Authority is behind developments like Cottonwoods at Mid-Valley and Alpenglow Village, while neighboring town Hayden is exploring innovative approaches. However, the pace of affordable housing development – about 2.2 units per year – has struggled to keep up with demand.
SM: Has this housing crisis had other ripple effects on the local community?
SS: Absolutely. The lack of affordable housing has driven many local tradespeople – carpenters, electricians, plumbers – out of town, especially during the Great Recession. Few have returned, leaving a gap in the workforce. Additionally, high housing costs are reshaping the community dynamic, making it harder to maintain the town’s character and accessibility for its year-round residents.
SM: Despite these challenges, does Steamboat have room for growth?
SS: Yes. Unlike some resort towns, Steamboat still has development potential. Investments in infrastructure and new projects like Crawford Square and Thunderhead Beach signal growth. However, striking a balance between preserving the town’s identity and meeting the demands of a growing population is the challenge ahead.
SM: What’s the future of Steamboat’s housing market?
SS: While some price corrections are happening as sellers adjust expectations from pandemic-era highs, prices aren’t expected to plummet unless a major economic event occurs. The town remains desirable, and its unique character will likely continue to attract buyers, both local and out-of-state. That said, maintaining affordability and fostering a sustainable community are pressing issues Steamboat must navigate. Steamboat is emblematic of a broader trend in resort towns nationwide: an evolving housing market where affordability, desirability and growth collide. While the town’s allure is undeniable, its future hinges on its ability to adapt and ensure that both long-time residents and newcomers can find a place to call home.
Earlier this year, The New York Times published an article titled, "Where Are America's Most Expensive Towns?" It highlighted Steamboat Springs as the fourth most expensive micropolitan area in the country. The article sought to answer a pressing question: Are smaller towns truly more affordable than big cities? To delve deeper into this topic, Steamboat Magazine staff writer, Haley Watkins, spoke with local real estate expert, Sue Stempel, of The Group Real Estate. Together, they explored the key factors influencing Steamboat Springs’ real estate market and examined whether our small town is as “affordable” as it seems.
Steamboat Magazine: Steamboat Springs is renowned for its ski resorts and outdoor recreation. How has the demand for homes in the area changed in recent years, especially post-pandemic?
Sue Stempel: The demand for homes in Steamboat Springs has skyrocketed, driven by the rise of remote work, a desire for outdoor access, and less dense living conditions. The pandemic intensified this trend, as people sought refuge from metropolitan areas. Historically low interest rates initially made smaller towns like Steamboat appealing, but this surge in demand quickly depleted supply and sent prices soaring.
SM: It’s often assumed that buying a home in a small town is less expensive than in a metropolitan area. Does that hold true for Steamboat Springs?
SS: While this was once true, the dynamics have shifted dramatically. To reference The New York Times article, a 2022 study ranked Steamboat as the fourth most expensive small town, with a median home value then at $691,800. That climbed to $1,110,750 in 2024, more than seven times the median income here. When compared to metropolitan areas with similar home values, like San Diego, Steamboat is slightly more affordable but only marginally. The assumption that small towns are inherently cheaper no longer applies, especially in resort towns like ours.
SM: What’s driving these steep price increases? Is it mainly locals or external demand?
SS: It’s a mix. The demand for vacation homes and rentals has had a significant impact, but so has the migration of people seeking permanent residency for the lifestyle Steamboat offers – recreation, good schools and a strong sense of community. These factors make Steamboat desirable, but they also exacerbate housing challenges, pushing prices higher.
SM: How do Steamboat’s home prices and affordability compare to other resort towns, like Aspen or Jackson Hole?
SS: Steamboat’s average home price is currently $1.34 million, which is “affordable” compared to Aspen at $2.7 million or Jackson Hole at $3.3 million. But affordability is relative. For locals earning a median income of $93,280, Steamboat’s price-to-income ratio of 7.27 still makes it challenging to buy. It has more than doubled in the last five years and more than tripled in the past 10. Many residents have been priced out and are having to move to more affordable areas.
SM: Are there areas within Steamboat Springs where housing is more affordable?
SS: Outside city limits, housing becomes more accessible. In towns like Hayden, Oak Creek and Phippsburg, median home prices hover around $585,000, significantly lower than Steamboat’s $1.34 million. Properties with less than an acre of land in these areas are especially more affordable.
SM: Are there any local efforts to address housing affordability?
SS: Yes, several projects aim to tackle the issue. The Yampa Valley Housing Authority is behind developments like Cottonwoods at Mid-Valley and Alpenglow Village, while neighboring town Hayden is exploring innovative approaches. However, the pace of affordable housing development – about 2.2 units per year – has struggled to keep up with demand.
SM: Has this housing crisis had other ripple effects on the local community?
SS: Absolutely. The lack of affordable housing has driven many local tradespeople – carpenters, electricians, plumbers – out of town, especially during the Great Recession. Few have returned, leaving a gap in the workforce. Additionally, high housing costs are reshaping the community dynamic, making it harder to maintain the town’s character and accessibility for its year-round residents.
SM: Despite these challenges, does Steamboat have room for growth?
SS: Yes. Unlike some resort towns, Steamboat still has development potential. Investments in infrastructure and new projects like Crawford Square and Thunderhead Beach signal growth. However, striking a balance between preserving the town’s identity and meeting the demands of a growing population is the challenge ahead.
SM: What’s the future of Steamboat’s housing market?
SS: While some price corrections are happening as sellers adjust expectations from pandemic-era highs, prices aren’t expected to plummet unless a major economic event occurs. The town remains desirable, and its unique character will likely continue to attract buyers, both local and out-of-state. That said, maintaining affordability and fostering a sustainable community are pressing issues Steamboat must navigate. Steamboat is emblematic of a broader trend in resort towns nationwide: an evolving housing market where affordability, desirability and growth collide. While the town’s allure is undeniable, its future hinges on its ability to adapt and ensure that both long-time residents and newcomers can find a place to call home.