Tony Walton's Full Article (Unedited)

Vermont real estate exhales. Here's what the numbers, the Statehouse, and 24,000 missing homes are trying to tell us.

For four years, Vermont real estate behaved like a Soho House membership line. Irrational. Performative. Rigged against everyone who showed up.

Inventory was a rumor. Bidding wars were a personality trait. Buyers walked into open houses the way people walk into the DMV — braced for indignity.

That market is dead. Long live the market.

The Numbers Are Finally Telling the Truth

Statewide inventory is up 11.7% year-over-year. Median days on market: roughly 91. Sellers are taking home 96.3 cents on the dollar — not 105, not 110. Above-list sales have collapsed from nearly 20% to 13.7%.

And yet the statewide median price still climbed to about $412,200. Waterbury's average home value sits at $550,330, up 1.8% year-over-year. Chittenden County crossed $500K in most segments and never looked back.

Here's the paradox nobody at the cocktail party can explain: How do prices keep rising while inventory rises?

Because Vermont isn't a real estate market. It's a supply deficit wearing a real estate market's clothes.

We still have only about 2.9 months of supply. A balanced market needs four to six. We've moved from frozen to functioning. We have not moved to fair.

The Equity Fortress

Eighty-seven percent of mortgaged Vermont homeowners are equity-rich. Among the highest rates in America.

Translation: there are no panic sellers. The 2008 playbook — distressed listings, foreclosure cascades, forced price discovery — does not apply here. There is no kindling.

Vermont owners can wait out a bad rate cycle the way Warren Buffett waits out a bad quarter. Patiently. Sipping something local.

That is why the "crash is coming" YouTubers keep getting Vermont wrong. They are pricing a market that doesn't exist on a topography they've never walked.

The Statehouse Just Walked Back the Walk-Back

This is the story most brokers aren't tracking. They should be.

June 2024: Lawmakers override Governor Scott's veto and pass H.687 — known as Act 181 — the largest Act 250 reform in fifty years. It exempts housing in Vermont's 24 designated downtowns from Act 250 review through January 2027. It exempts projects of up to 50 units around dozens of designated village centers.

It also introduces a two-tier Property Transfer Tax. The general rate stays at 1.25%. But second homes and non-principal residences get hit at 3.4%.

Call it what it is — the "Welcome to Vermont" tax. The Legislature finally figured out that the Audi from Greenwich could pay a little more on the way in.

Then, on May 21, 2026, the Joint Committee of Conference on S.325 — now Act 152 — voted to repeal Act 181's Tier 3 jurisdiction and the controversial "Road Rule." The two pieces environmentalists won and developers hated.

But — and read this carefully — the same committee stripped out the Senate-passed pro-housing reforms that would have:

• Extended the interim Act 250 housing exemptions to 2030
• Removed arbitrary parcel-size constraints
• Expanded interim exemptions to more rural communities
• Expanded the Priority Housing Project for mixed-income and affordable development

"In the midst of a deep housing affordability crisis, this joint committee cast aside a series of thoughtful, reasonable pro-housing changes." — Alex Farrell, Commissioner, Vermont Department of Housing and Community Development

The takeaway for anyone holding a developable parcel near a designated downtown — Waterbury, Stowe Village, Montpelier, Burlington: the calendar is now the asset. The regulatory window is real. It has a January 2027 expiration sticker. The Legislature just signaled, clearly, that the door narrows.

The 24,000-Unit Hole

Vermont is short roughly 24,000 housing units. Some studies put the number closer to 30,000 or 40,000.

Since 2001, Vermont median home prices have risen 148%. Median household income has risen 72%.

That spread is not a market quirk. It's a generational sorting machine. It picks winners from a finite pool of equity migrants out of Boston, New York, and the Bay Area. It locks out almost everyone whose paycheck originates inside the state.

The press releases keep dancing around it. The math doesn't.

The Buyer Has Quietly Changed

The 2021 Vermont buyer was a panicked Brooklynite with a Zoom job and a Subaru.

The 2026 buyer is a more deliberate animal. Remote workers who already moved, stayed, and are now trading up. Retirees liquidating coastal equity. Second-home buyers — now paying the 3.4% tax and getting choosier about what's worth it. Patient equity migrants who waited out the bidding wars and are finally pulling triggers.

These buyers are less rate-sensitive than first-timers. They're not financing the whole purchase. They're financing the tail.

That is why 6%-plus rates haven't crushed Vermont the way the textbooks say they should. The textbooks assume buyers are stretched. Ours, in large part, aren't.

The Bifurcation Nobody Talks About at Closings

The market is splitting into two markets. The gap is widening every quarter.

Condition and presentation now matter more than they did in 2022. A lot more.

The Honest Read

Buyers: this is the best negotiating window since 2019. It is also seasonal, and probably temporary. Spring competition will compress it. Move while the room exists.

Sellers: 2021 isn't coming back. Price to the comp, stage to the buyer, and stop arguing with the market. Aspirational pricing in 2026 just buys you 91 days of carrying costs and a price cut anyway.

Developers: you have until January 2027 to break ground inside a designated downtown without an Act 250 permit. After that, the Legislature has signaled, clearly, that the door narrows. Mud season ends. So does this window.

Vermonters: pay attention to who is getting elected this November. The next Legislature decides whether we solve our housing problem or just keep writing essays about it. (Yes, I see the irony.)