Sales through August are down 18% in dollars and down 28% in the number of sales. The culprit seems to be lack of either affordable or desirable inventory. The buyers are out there, waiting to pounce on their dream property, but they don’t like what is currently available or the suggested asking prices. Of course there are always a few ‘outlier’ sales and too many sellers think their property fits that category.
Let’s look at our market a little differently for the first eight months of 2018. There were 46 condominium sales in the Town of Telluride and 63 in the Mountain Village. More affordable asking prices in the Mountain Village are probably influencing some of that disparity. However, there were 13 home sales in the Town of Telluride and 12 home sales in the Mountain Village for the first eight months. My guess is that much of the home inventory in the Mountain Village is a little tired and old. Personally, I can relate to that a bit…Ha! During the same period there were nine vacant residential lot sales in the Town of Telluride and 13 in the Mountain Village. Affordability is definitely a factor in this category since a lot in the Town of Telluride is well past $1M while there are many options in the Mountain Village under $1M. Some brokers suggest the high cost of construction is a factor in slower lot sales with construction costs of $500 to $600 dollars or more per square foot being a big factor. Additionally, the time of creating architectural plans and construction lasting for about two years more or less is just too long for many buyers.
Amazingly, there hasn’t been one house sale this year in the Aldasoro Subdivision, but there have been five lot sales. The Ski Ranches has fared better with six home sales and only one lot sale. The rest of San Miguel County has seen 33 home sales and 29 vacant residential lot sales. The towns of Ophir, Rico, Norwood and Ridgway are booming the most I’ve seen in decades. See the monthly Telluride Consulting cover page below for the general market trend this year.
How are we doing compared to some other western United States ski areas? Let’s look at the first six months of 2018 as a comparison.
Aspen: The number of home sales in Aspen are down 30% and up 30% in Snowmass. My Aspen source says there is finally some price resistance in Aspen and the values are just way better in Snowmass. Aspen average sale price per square foot (PSF) is about $2,500 and about $900 PSF in Snowmass.
Breckenridge: Dollar amount of sales are up 9% and the number of sales are up 2%.
Steamboat Springs: Dollar amount of sales are down 8% and the number of sales are down 7%.
Vail: Dollar amount of sales are up 47% and the number of sales are up 13%.
Jackson Hole: Dollar amount of sales are up 34% and the number of sales are up 15%.
What I think I’ve learned after tracking these ski resort markets for over 30 years is that they all heat up and cool down slightly different. Vail’s sales weren’t so great in 2017, yet Telluride’s was the best in 10 years. The uptick in Jackson Hole sales is being driven by high end home sales. Home sales this year in Jackson Hole above $1M are up 38% and home sales above $3M are up a whopping 300%. However, generally all these markets suffered equally during the great recession and all improved within a year or two of each other.
Suggestions for sellers: Price right from the beginning…time is your enemy. The longer you’re on the market, buyers start to ask, “What’s wrong with this property?”
Suggestions for buyers: Inventory is limited. There are very few new condominium projects on the market or coming to the market because land zoned for condominiums is nearly non-existent. There are some new homes and some great remodeled homes, but a very small supply. Don’t expect a lot of new choices soon…see above…it takes too long to develop them.
As always, we are here to help you make a good decision as a seller or a buyer.
George Harvey, Jr.