Aspen Real Estate Market Heating Up
A strong first-quarter performance by the Aspen-area real estate market has brokers upbeat heading into the busy time of the year.
There were 311 real estate transactions in Pitkin County from January through March, according to Land Title Guarantee Co. That was an increase of 52 percent over the same period in 2013, the title insurance company reported in its monthly report.
The cumulative dollar volume of all real estate sales in the county was $250.2 million — an impressive increase of 42 percent over the same period last year, Land Title Guarantee Co. said.
“We’re definitely moving in the right direction,” said Michael Latousek, broker associate with Joshua and Co. “The winter didn’t start off with a bang, but it ended up well.”
Aspen’s above average snowfall and robust economy during the ski season helped spur real estate activity and likely attracted new travelers — and potential real estate buyers — to the area, according to Latousek. He said he showed property last winter to new buyers from Australia and Argentina.
On the heels of the solid first quarter, sales continued to be strong in April, said Andrew Ernemann, a real estate broker associate with Aspen Snowmass Sotheby’s International Reality. While the first four months of the year is a generally slow time for the Aspen-area real estate market, the numbers set a pace that would put transactions and dollar volume ahead of year-end 2013 statistics, he said.
“The mood is quite positive in Aspen,” Ernemann said of the real estate industry. In Snowmass Village, real estate agents are pleased with activity in some segments but there is “a lot of head-scratching” over the slow sales in upper-end, single-family home sales, he said.
Different feel to market
Sometimes the numbers don’t tell the entire story, according to real estate agents.
“Apart from the numbers, there’s been a very real shift in the real estate market in the last three or four months,” Ernemann said. Some of the new listings are spurring multiple offers in just a few days, Ernemann said. “We’re under supplied for a certain type of property.”
The hottest sellers are townhouses and single-family homes in the core of Aspen — roughly between the Castle Creek bridge to the west and the Roaring Fork River Bridge on Cooper Avenue to the east. Four-bedroom units with spectacular views as well as West End homes have been in high demand and appreciating in price, Ernemann said. They held up well even during the recession, he said.
In a broader perspective, the ultra-luxury market already is showing signs of success. There have been nine sales of residential properties priced $10 million or more so far this year, including the recent sale of the Hotel Lenado, Ernemann said. That compares to nine total sales in 2009; 10 sales in 2010; 15 in 2011; 16 in 2012 and 12 last year, according to his data. This year is on pace to top those performances in the high-end market, barring any change in the macroeconomic picture.
“That is a strong statement of health in the market,” he said.
Latousek said the luxury real estate market has exploded in several big cities, ranging from San Francisco to Dallas. There were record residential sales in early May for $140 million in East Hampton and another for $120 million in Connecticut, he noted. Latousek said it is reasonable to believe that success in the luxury market will carry over to Aspen this summer. His firm already has experienced an increase in recent weeks in showings of homes priced at $20 million and above, he said.
Trends in the market
Pitkin County’s real estate market soared through the mid-2000s, then tumbled in 2008 and bottomed out as far as dollar volume in 2009. It posted modest year-to-year gains in 2010-12, but slipped a bit last year. In other words, there is room for improvement.
Ernemann and Latousek see several signs that the market may be poised for that improvement this year. Ernemann said there has been increasing sales and decreasing inventory for four years now, so that will have definitive effects in the market.
He expects the number of sales to continue to be strong and prices to continue to increase for properties in the core and West End. He expects the activity to spill over into east and west Aspen and the possibility of price increases in those neighborhoods.
“That kind of has a snowball effect,” he said.
Sales of condominiums and single-family homes priced less than $2.5 million have been strong in Snowmass Village, Ernemann said, but sales of homes priced greater than $2.5 million have been “eerily quiet” the past three or four years, he said.
In the Aspen part of the county, dollar volume is up to $232 million from $174 million through the end of April, according to Ernemann’s data. He doesn’t believe that 33 percent increase will last through the year, but said a 10 percent increase is possible.
Latousek said the performance of Aspen’s real estate market often mirrors the stock market. Some people may be considering taking their gains out of the market since it is at record levels. That could lead to investment in real estate in places such as Aspen, he said.
He expects the demand to keep building for top properties in Aspen-Snowmass. “People don’t mind paying a premium for good product,” he said.
Land Title Guarantee Company’s monthly report showed that the first quarter was solid beyond Pitkin County. Dollar volume of sales in Garfield County was $84.45 million, an increase of 38 percent over first quarter 2013 even though transactions fell by 10 percent.
In the midvalley area around Basalt and El Jebel, transactions were flat during the first quarter but the sales volume was up 35 percent to $56.11 million, according to Land Title Guarantee Co.
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