Declining Real Estate Prices in Western Colorado—It’s a Good Time to Buy!
Understanding the Recent Trends and Contributing Factors
By Gary Hubbell, ALC
United Country Colorado Brokers, Inc.
Every time I’m out and about, people ask me about the real estate market. “What’s going on?” they ask. “Are you busy?” Now, we’ve all been trained to be upbeat and positive about market trends, but honestly, it’s slow. Sales volume has slowed considerably since the market peaked in early 2024. In Delta County, Colorado, where I make my home, the median sale price dropped from a peak of $465,000 in June 2024 to $362,000 in November 2025—a 22% decline.
There are several factors that could explain this, given that Delta County isn’t a very large market. In fact, my son Jake and I might be guilty of skewing the numbers, because we sold several big properties over $2 million that likely boosted the median. Maybe some of the better inventory was on the market during that time, while possibly the overall quality of the offerings today is not as good, reflected by lower sale prices. Regardless, a 22% decline is very significant.
Key Factors Contributing to Price Drops in Colorado Real Estate
There is more inventory on the market today, and the “months’ supply of inventory” reached at 5-year peak in September 2025, with 7 months’ supply. In November, the figure stands at 6.68 months of inventory, a slight decline, but up 58% year-over-year. Sellers who are serious about selling are forced to drop prices or accept lower offers if they want to move on.
Home Affordability is a Major Factor
Of course, affordability is the buzzword of 2025. The Federal Reserve, responding to the huge irresponsible spending initiated during the Biden administration, jacked up interest rates to the point that mortgages more than doubled for the same amount of money. Despite a total of four rate drops over the past year or so, a $450,000 mortgage at 6% interest, together with taxes and insurance, requires a payment of somewhere between $2,900-$3,200 a month. Young families and first-time homebuyers simply can’t afford such a large payment.
There’s a Big Disconnect Between Buyers and Sellers
However, these facts and data points haven’t soaked in with sellers, who seem determined to stubbornly keep their gaze on the rear-view mirror and hold on to 2024 prices, even as 2026 looms large in the front windshield. The median Delta County residential list price in November 2025 is $525,000, a whopping spread of 45% from the median sale price of $362K.
Source: National Association of Realtors—RPR
I don’t know how that’s supposed to work out! Can we suppose that there’s suddenly higher demand and the inventory that’s now on the market is superior to what was just sold? That a new tranche of buyers with more money to spend will suddenly appear and appreciate the higher quality and superior attributes of the current listings? Or is the new crop of sellers a bunch of people who haven’t studied recent market trends and they’re clinging to the idea of what their neighbor got for their house two or even three years ago, and their agents are not clued in to the market, either, and have not properly advised their clients? I think it’s the latter. Stubborn sellers + passive, uneducated agents = stigmatized, overpriced listings that languish on the market. Quite a few sellers are going to have to “get real” if they want to sell.
What About Larger Properties and Nicer Homes? Are They Still Selling?
You may think, “Yeah, that’s interesting, but I don’t own a starter home. I have a very nice country estate that’s worth a lot more than a starter home. It’s a different market.” True, but that market is slow, too. Through my affiliations with the Realtors Land Institute and United Country Real Estate, I am networked with rural property professionals all across the country. I was recently on a conference call with a dozen Colorado brokers who were all reporting slow sales activity. I’ve spoken to agents and brokers in Nebraska, Arkansas, Washington State, Iowa, Ohio—all over the country—and the story is the same. The market is declining and sales are slow. We are seeing a slowdown in farmland sales, luxury homes, and higher-end properties. While many buyers for such properties pay cash, interest rates are still a concern and a drag on the market in general. We’re seeing an overall decline of 10% or more on country estates and larger properties. I did a data search in the Colorado Real Estate Network (CREN) MLS that covers the majority of Southwest Colorado with the following parameters: single-family housing, lot size over 5 acres, highest price bracket (over $571,000), and 2,500 square feet or larger. The median sale price for those properties peaked in September 2024 at $1.7 million. In November 2025, the median sale price for those parameters is $1,290,000—a 24% decline. The inventory supply of larger homes on acreage went from 3.8 months in January 2022 to 16.6 months in November 2025—an increase of 436%.
CoVid Was a Black Swan Event That Accelerated the Market
Inventory was down 50% in 2020 and closed sales reached an all-time high. The median residential sales price in the Montrose, Colorado MLS in 2019 was $270,000, and by 2022 had jumped to $414,000. This trend follows the national trend. Higher-priced properties followed suit, but not quite to the extent of the baseline residential market. Why? I’ll just say it—the Biden administration allowed millions and millions of illegal aliens into the country during the CoVid years, with some people estimating more than 20 million people. This caused an immense strain on lower-end or average housing prices. Not many of those illegals were looking for country estates or luxury homes.
It’s OVER Now! CoVid Pricing is in the Rear-View Mirror
The number of active listings of larger properties started at 105 in January 2022 and now stands at 259—about 150% more properties on the market. November 2025 saw only 14 of those larger properties sold, while 31 of them sold in August 2022. In fact, of all the sectors in the market, these higher-end country estates between $1 million and $5 million are probably the slowest sector because few buyers absolutely have to have a country estate. They may WANT a luxury home in the country, but few buyers have circumstances that mandate buying a nice home in the country. Prices are dropping accordingly as motivated sellers realize they’d better get in the game. Many agents and brokers that I’ve spoken to have noted that realistic comparable sales cannot be gathered from the past year or two. “You have to look to pre-CoVid sales for accurate market data,” a fellow Accredited Land Consultant told me. “Nothing from the past couple of years makes any sense in today’s market. If your sellers are counting on those kinds of results, they’ve missed the boat.” As brokers, we’re confronted with sellers whose neighbors cashed in two years ago and they expect similar numbers. Here’s my take: IT’S OVER. You missed the boat. If you want to sell, you’ll have to get realistic on pricing, and hopefully you’ll get it sold before the market declines any further.
Early Signs that the Market is Recovering in 2026
In my perspective, perhaps November 2025 was the low point of the market in the past four years. We have encouraging signs that the economy is recovering. Third-quarter growth in 2025 was 4.3%, which was much higher than any so-called experts expected. It’s now possible to get financing in the 5’s and even high 4’s for 15-year mortgages. Donald Trump will certainly let Jerome Powell take his leave as Chairman of the Federal Reserve when his term is up in early 2026, and will install someone who is favorable to further interest rate reductions. My broker colleagues tell me that 2026 is already starting out with more activity and interest in properties, so maybe we’ve bounced off the bottom and we’re headed back up. Let’s just say that I’m cautiously optimistic.
What Does My Crystal Ball Say? Cautious Optimism
First, the Fed’s four interest-rate drops this year have been very helpful, but not enough. Jerome Powell’s term as Chairman is up next month, and Trump has said he won’t renew his tenure. Chances are good that we’ll get a Fed chair who will relax money policy even further. In the meanwhile, savvy buyers with a good down payment can leverage a 5% loan with a 15-year term. That is very close to what has historically been considered “cheap” money. We have lenders with Rural 1st who offer a loan with interest rates that can be adjusted downward by paying only $750 with no underwriting, and the borrower can keep the term of the loan the same. In other words, if a borrower has been paying a 15-year mortgage for the past three years and wants to refinance, they can do it for only $750 and still have only 12 years left on the payment schedule. That’s a great deal, in my opinion. If we can get interest rates back in the 4’s for 15-year loans and in the 5’s for 30-year loans, watch out—the market will pick up substantially.
Now Is a Great Time to Buy Western Colorado Real Estate
I’ve just presented you with the knowledge and data that explains how much the market has dropped in the past year and a half. Now take advantage of it! Historically, Western Colorado’s peak month of market activity is May. If we get another quarter point or even half a point of interest rate reductions, I think the market will pick up considerably. As we go into January and the days get longer and spring is in the air, I believe we’ll see a resurgence in market activity, especially in the spring and early summer. If you’re an investor or buyer, it’s important that you work with a professional who knows and can explain market trends, valuations, interest rates, and potential future gains. Land values have declined, which makes it an excellent time to invest in land.
How to Sell It–Accurate Pricing Combined with Effective Marketing
Look, it’s not like the market has screeched to a halt. We’re just seeing the natural consequence of a very hot, inflated market due to a once-in-a-lifetime pandemic and super-low interest rates. People are still buying and selling. If you look at historic interest rates, the rates we’re seeing today have been normal and average for many, many years. If we get further rate reductions, money will be on the cheaper side of the historical average. However, if you are a seller, you need an experienced professional to get your property sold. This is NOT the time to list with an inexperienced broker with limited capabilities. Homes and land listings with poor photography, limited exposure, poor SEO, and limited internet exposure will languish on the market and ultimately will sell for less than they’re worth. Properties with proper pricing and a strong marketing push will sell at market rates. Are you interested in buying or selling? Our land brokers and property professionals can help you with the process. Call us for a consultation.
Gary Hubbell, ALC, is a Colorado land broker, auctioneer, and personal property appraiser who specializes in ranches, farm land, outfitting businesses, resorts, and hunting land. Recognized by the Realtors Land Institute as an Accredited Land Consultant, Gary is one of only 56 ALC’s in Colorado. He has written about land issues for Terra Firma, RLI’s national magazine, as well as hundreds of other magazines, newspapers, and websites. Gary makes his home on a ranch in Crawford, Colorado, where he and his wife, Doris, raise hay, horses, and Labrador retrievers.