Real Estate Market Conditions

January 2012 Park City Real Estate Market Conditions

January 29, 2012

2011 and the start of 2012 have certainly been an improvement for Resort Real Estate Sales. The trends that I have been reporting continued for the 4th quarter of 2012. The number of sold properties increased 18% in 2011 vs 2010. At the same time, the number of new listings taken decreased 13% from 2011 vs 2010. We also saw the average sold price of all property types drop 10% from 2010 to 2011.

Like with all statistics, an understanding of the numbers is important. With prices down significantly from the high point of 2006, Park City Agents are telling our sellers that if they are not prepared to price their property competitively for today's market, now is not the time to sell. This is accounting for much of the decrease in listings taken. At the same time, we saw buyers focusing on the lower priced properties and distressed sales, thereby decreasing the average sold price . I would be hard pressed to tell you that a home or condo in 2011 was worth 10% less than it was in 2010.

This year has started stronger than I have seen for many years. The number of people looking at and purchasing real estate over the Christmas Holiday was surprisingly strong, and has continued through January. For instance, from the start of the holiday in December through January there were 11 properties sold in the Silver Lake area of Deer Valley. for the same time frame in 2010, 0 properties sold. Furthermore, the sales spanned all price ranges, from condos in the $500,000 range to over $3 mil and homes up to and over $7 mil. From speaking with my resort colleagues from the other western resorts, they are all reporting similar activity. Very refreshing to see the return of the big ticket buyer.

Let's hope that this trend continues and that the economic recovery that there is hints of is real.

November 2011 Park City Real Estate Market Conditions

November 15, 2011

Western Mountain Resort Alliance

In 1996 I founded an organization called the Rocky Mountain Resort Alliance which was composed of boards of REALTORS of ski resort towns throughout the Rocky Mountain States. Since the founding, the group has grown to include resorts in Lake Tahoe California and Whistler British Columbia. To better reflect the expansion, we have renamed ourselves the Western Mountain Resort Alliance. Our members are in the resorts of Whistler, British Columbia, Park City UT, Steamboat, Vail and Crested Butte in Colorado, Sun Valley Idaho, Big Sky Montana, Lake Tahoe California and Jackson Hole Wyoming. One of the purposes of WMRA is to share information on Real Estate sales and market health. We have been collecting statistics on Real Estate sales from 1996 to present and publish them quarterly. Many of the trends that I have been reporting on these past several months are true for the other resorts as well.

For awhile now, I have been saying that number of listings are down and number of sales are up. Frequently I hear that Park City must be an anomaly as this could certainly not be indicative of the rest of the country. In looking at the 3rd quarter statistics I see that this trend is true throughout the Western resort markets. Number of listings for 2011 vs 2010 are down anywhere from 2-16%. The only exceptions are Lake Tahoe which is up 6% and Jackson which is even with last year. At the same time, all of the resorts except for Crested Butte, are showing an increase in number of sales from 1% (Vail) to 40% (Big Sky). Most resorts are up 20-30% from 2010. At the same time, the average sales price for every resort except for Big Sky and Crested Butte, has dropped from 2010. The average sold price has declined from 10-20% for the remaining resorts.

What this is telling me is that while inventory is at a historic low, prices are also down and buyers are taking advantage of this rare event. Is this the "perfect storm" for investors to land the choice real estate at bargain prices? Which ever resort you frequent, it certainly appears that now is not the time to dawdle.

For more specific information on any of these resorts, please give me a call or drop me an email.

Dennis Hanlon

Summit Sothebys International Realty.

October 2011 Park City Real Estate Market Conditions

October 21, 2011

Choosing the right agent

The Real Estate trend that we have been following throughout the summer has continued through September, with the number of sales up, prices flat or in some areas still dropping and number of listings decreasing.

If we just look at the numbers with no understanding of the market, we will get a false impression. For example, The average price of a home sold in the Park City area from Jan 1 through September 2011 compared to 2010 rose 4.5%. However, just comparing the month of September 2011 to 2010, the average sold price rose 24%. Condo sales were just the opposite, Year to Date average sold price dropped 27% and the September to September sold price dropped 35%. What I can tell you for sure is that home prices have not increased 4-24% and condo prices have not dropped 27-35%. So what is going on?

In some cases, a look at the stats quickly reveals the truth. If we look at condo sales in lower Deer Valley for September 2011 vs September 2010 we see that in 2010 one condo sold with a price of $2,289,000 and in 2011 one condo sold for $514,000, or a decrease of 77.5%. Prices did not fall, just what was sold. Similarly, we are seeing more homes sold in a higher price range than in 2010, thus showing an increase in average sold price.

As with all real estate, and particularly resort real estate, having "behind the scenes" knowledge is critical to understanding the market and in turn, being able to make informed and wise decisions. When looking for resort real estate, do your homework. Look for a seasoned agent who understands what you are looking for and can demonstrate a better than average knowledge of the local real estate market.

Dennis Hanlon
Associate Broker

September in Park City, UT

September 15, 2011

Resort Real Estate

With the stock market on a roller coaster ride and the national economy is turmoil, the resort Real Estate market continues to be bouncing around the bottom. Adding to the uncertainty is that the conforming loan amounts are set to lower on October 1st. Currently, in Park City, the conforming loan limit is $739,000 but will drop to $600,500 on the 1st of October. What this means is that buyers who purchase a home or condo that wish to obtain a loan greater that the $600,500 limit will now pay Jumbo rates, typically about .50% higher. While this may not seem significant, it significantly raises the mortgage payment and in some cases could prevent the borrower from qualifying. This has the potential to negatively impact the resort Real Estate market.

Year to year comparison for August seems to reflect the uncertainty with the economy.The number of single family homes sold was basically flat, 73 in 2010 and 75 in 2011. However, the average sold price was down 12.6% from $755,915 to $660,727. Condo sales, interestingly enough, were quite the opposite. 37 sales in 2010 and 44 in 2011. Average sold price increased 69.8%, from $502,907 to $854,004 in 2011. This is very encouraging as we transition from the summer selling season of homes to the vacation property winter season.

September 15th and fall has arrived. The Maples have turned and the Aspens are just starting. There was snow in the Colorado Rockies last night and possibly high elevation snow in Park City this weekend. Time to get in ski shape!

Dennis Hanlon
Associate Broker
Summit Sothebys International Realty.

August 2011 Real Estate Market Conditions

August 19, 2011

YTD and July vs July sales comparison

As I have reported in previous posts, sales for 2011 are up over the same period 2010, and this trend is continuing.

YTD sales for single family homes are up 23%, from 349 sales in 2010 to 430 in 2011. Comparing July 2010 to July 2011, there were 58 sales of single family homes in 2010 and 67 sales in 2011, or an increase of over 15%. YTD average sold price comparison is up 4.2%, from $852,820 in 2010 to $888,601 in 2011. July to July comparison is more dramatic. Average sold price increased 32.4% from $688,534 in 2010 to $911,958 in 2011. New listings of single family homes continues to decline, from 219 new listings in July 2010 to 165 new listings in July 2011 or a decrease of 24.7%

Condo sales continue this trend with number of sales YTD up 10.6% from 293 sales in 2010 to 324 in 2011. but average sold price continued to decline 32% from $943,085 to $640,026 in 2011. Number of listings YTD is continuing to decline as well, from 757 in 2010 to 623 in 2011 or down 17.7% Looking at July vs July condo sales, number of sales is up 34.6% from 26 in 2010 to 35 in 2011, average sold price declined 59% from $817,942 in 2010 to $335,287 in 2011 and number of listings in down 18% from 94 new condo listings in 2010 to 77 in 2011.

So, what does all this mean? Buyers are here and they are buying. However, buyers are very price sensitive and are only looking for what they perceive to be deals.
With inventory continuing to decline, the better properties are going away and are not being replaced as quickly as they are being purchased. This equates to the right time to buy. Still low prices, a dwindling inventory and low interest rates. Resort Real Estate has always been popular and now it appears that buyers are back in the market.

Dennis Hanlon
Associate Broker
Summit Sothebys International Realty.