Colorado mountain resort real estate shows big swings
By the numbers
$78 million: Sale price of Aspen’s Hotel Jerome.
22.9 percent: Decline in the first-quarter median sales price in Grand County.
35.9 percent: Share of first-quarter sales in Eagle County made to Front Range buyers.
1.6 percent: Share of first-quarter sales in Pitkin County made to Front Range buyers.
Source: Land Title Guarantee Co.
EAGLE COUNTY — Colorado’s mountain resorts cover a huge amount of territory, and those resorts account for billions in real estate sales. But just a few sales can create some big swings on charts that track average prices, sales volume and other numbers.
Land Title Guarantee Co. recently released a snapshot of first-quarter 2015 sales activity for the seven counties that contain most of the state’s resorts — Eagle, Summit, Routt, Grand, Garfield, Pitkin and San Miguel (that’s Telluride). The snapshot paints a good growth picture overall. But there are some big bumps on those charts.
For instance, Pitkin County’s dollar volume — the aggregate sales price of all real estate transactions — more than doubled comparing the first quarter of this year to the same period in 2014. While the volume spiked, the number of transactions showed a solid but not exceptional increase of about 12 percent for the period.
Bob Rulon, a Land Title representative in Pitkin County, said a significant part of the spike in volume came from just one February sale, a $72.5 million deal for Aspen’s Hotel Jerome, as well as that town’s Cortina Lodge and an office complex. That one deal accounted for 14.8 percent of the quarter’s sales volume, Rulon said.
Conversely, a lack of big sales swung the charts lower in Grand County, which for the quarter saw double-digit declines in the median residential price and average residential price. Despite those drops, the number of transactions in that country grew 20 percent from 2014’s first-quarter figures.
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Mike Budd, a broker with Berkshire Hathaway HomeServices in Eagle County, said those big swings don’t mean much in the long run because the limited number of big-dollar transactions have such an outsized effect on short-term numbers.
Budd is also a member of a committee that provides financial advice to the Eagle County government. He said that a recent presentation by Eagle County Assessor Mark Chapin provided a good look at the overall real estate picture in the county.
“What we’ve seen is some significant blips in some areas, while others are more or less in line with inflation,” Budd said.
LAND TITLE NUMBERS CAN BE MISLEADING
But looking just at the Land Title numbers can be a little misleading when looking at residential real estate, since that company’s reports include all transactions recorded at county clerk and recorders’ offices.
Julie Bergsten is a vice president at Slifer Smith & Frampton. That company is the largest real estate company in Eagle County and also has a significant presence in Summit County. Bergsten said using residential Multiple Listing Service provides a more accurate look at prices, since it doesn’t include big commercial or land transactions such at the Hotel Jerome or the March sale of the former Adam’s Rib property south of Eagle.
The Land Title data can also be somewhat misleading when it comes to who’s buying homes and land. For instance, the recent snapshot breaks down where buyers come from. Most of the sales are pretty straightforward — the closer a location is to Denver, the more Front Range buyers there are.
And given that the Front Range market remains hot, buyers from Denver and surrounding areas are finding good values in Summit, Routt and Grand counties, Bergsten said.
Buyers from other states is also an easy-to-understand statistic.
But Slifer Smith & Frampton managing partner Jim Flaum said the data can be misleading when it comes to international buyers. That data shows a vanishingly small percentage of sales to international clients — San Miguel County leads the way with 5.6 percent of sales made to those buyers. But, Flaum said, many, if not most, international buyers create U.S.-based trusts or limited liability companies to handle real estate and other business deals in this country.
“People will hardly ever use a Mexico City address,” Flaum said.
While there are wrinkles in the latest snapshot of the region’s real estate market, there is a constant — markets are strengthening in the wake of the nation’s years-long economic slump.
Locally, Bergsten said she expects the market to continue to gain strength over the next few months, despite being short on inventory.
“We’re up 30 percent in new contracts for April and May,” Bergsten said. “We’re really feeling good about the summer.”
Vail Daily Business Editor Scott Miller can be reached at 970-748-2930, email@example.com or @scottnmiller.