Diverse real estate markets showing good signs
Around the region
• Pitkin County saw the biggest year-over-year increase in gross volume — 32.5 percent — in the fourth quarter of 2015.
• Grand County total transactions increased 38.46 percent from the fourth quarter of 2014.
• The most 2015 transactions — 2,537 — were in Summit County.
• Garfield County had the largest percentage — 85.3 percent — of sales to local residents.
Source: Land Title Guarantee Company
EAGLE COUNTY — A Colorado title company tracks real estate activity across seven mountain resort counties, but those counties may be more different than alike.
Land Title Guarantee Co. tracks activity across the seven-county area of Eagle, Pitkin, Summit, Grand, Garfield, Routt and San Miguel counties. Those counties all have ski areas. That’s not where the similarities end, but all are markedly different markets.
For instance, Summit County has plenty of skiing and summer recreation. It’s also a relatively short drive on Interstate 70 from the Denver area. Grand County is about the same driving distance from the Denver area, but requires a trip on a two-lane highway. Routt County has much more agricultural and mining activity than other counties in the group, and San Miguel County — home of Telluride — is a long way from just about anywhere.
“Most resorts aren’t really in competition,” said Jim Flaum, Slifer Smith & Frampton real estate managing broker. “When people decide to buy, they’ve already been coming to a place for a long time. They aren’t going to say, ‘We’ve seen Vail, now let’s look at Aspen.’”
With that in mind, the Land Title look at the region provides some food for thought.
As you might expect, Pitkin County led the region in the value of all real estate transactions in 2015 — just more than $2 billion. Eagle County’s sales volume was just under $2 billion, so that might seem like a good comparison until you factor in the number of transactions.
More money, fewer sales
In Pitkin County, that $2 billion in volume came on 790 sales. Eagle County’s volume numbers came on more than 2,000 transactions.
Summit County, meanwhile, came a distant third in the set for sales volume — about $1.3 billion — but had more than 2,500 sales.
Average prices don’t always tell an accurate story — median prices are a more accurate measure of prices. Even with that more accurate measure — median price is the point at which half of all transactions were for more, and half were for less — Pitkin County’s median price of $1.36 million is by far the highest in the seven-county group.
One source of good news over the past few years has been the decline in bank sales — sales of property that’s usually been through foreclosure. In 2010, bank sales accounted for nearly 20 percent of all sales in Eagle County. That number in 2015 dropped to 1.9 percent of all sales.
Even in areas with relatively high foreclosure rates — Garfield, Grand and Pitkin counties — the rate of transactions tops out at 5.3 percent in Garfield County.
The flip side of the drop in foreclosures is the climb in transactions. Every county in the Land Title report saw more real estate transactions in 2015 than the year before.
The biggest jump — nearly 25 percent — came in Summit County.
Slifer Smith & Frampton has four offices in Summit County, and Flaum said his company’s transaction numbers increased more than the county as a whole. But, he said, the increase isn’t particularly surprising.
“What’s happening on the Front Range and in Denver is there’s so much more wealth being created there,” Flaum said, adding that Summit County’s proximity to that market is spurring the growth in second homes there. With demand will almost certainly come increases in price, Flaum said.
Construction Is gaining ground
New construction is starting to have a bigger impact on the market as well. In the seven-county region, only two — Garfield and Grand — failed to post double-digit increases in the percentage of sales volume due to new construction. The biggest increase in percentage came in San Miguel County. But Summit County posted both a solid percentage increase and the most actual new units sold — 160. Eagle County was second in that category, with 152 new units sold in 2015.
Flaum said all those numbers from those diverse markets point to one fact: “Resorts in Colorado mirror each other,” he said. “They all have the same clientele.”
Still, people tend to look for bargains.
Ski industry veteran Jerry Jones has long owned a development parcel in Grand County. He said increases there may be due to that county’s lower average and median prices.
Flaum said the same may be true in Routt County, where sale prices are starting to rise again.
“They had a long way to come back up over there,” Flaum said.
While Eagle and Pitkin counties have different customers, Flaum said the increases seen in the Aspen-area market could be a harbinger of things to come in this valley.
“Our increases have always lagged Aspen by a year or two,” he said. The increases there are, eventually, good news for the Vail Valley market.
Vail Daily Business Editor Scott Miller can be reached at 970-748-2930, firstname.lastname@example.org or @scottnmiller.