Ski Season 2014 Edition
Recovery Accelerates in 2013
Inventory Continues to Decline
The Summit County real estate market continued to improve in 2013.
The number of properties sold continued to increase. Sales have climbed back from the depths of The Great Depression v2.0 in 2009, when only 1069 sales occurred, to 1700 sales last year.
The average number of sales for the past 20 years has been 2060 per year, so the market is still about 18 percent below average.
But sales have increased by about 48 percent since 2009 and may be close to average in 2014.
Prices, however, are another matter. The average sale price has remained almost stagnant for the past 3 years. The average sale price of $473,400 in 2013 was slightly higher than that of 2011 and slightly lower than 2012.
This will change in 2014 if the number of properties for sale stays at the present low number. At the start of the year, there were fewer than 1300 properties for sale in Summit County. About 400 of these were vacant land for which there has been nearly no market in the past few years.
So, fewer than 1000 homes and condominiums were for sale in January. This is about a seven-month supply. The short supply will probably continue in 2014 as the number sold continues to increase and sellers remain scarce.
Certainly there will be more properties on the market as the start of the best selling season approaches in July, but it is doubtful that there will be an oversupply this year.
2013 began with about 1500 listings and peaked at about 1850 in late August. This is a normal net gain in listings.
350 more properties added to the 1370 offered in January of this year will make the supply just equal to the previous year’s total sales.
In 2009 there were about 1000 sales and about 3000 listings at the peak. This was not a normal situation. Owners worried that prices would continue to fall and sought to sell before they lost more value.
Price declines stopped in 2011 after a loss of 17 percent from the peak in 2008. The panic stopped as well. Many sellers took their property off the market and didn’t return.
Today’s sellers are selling for normal and rational reasons: changes in their lives, need for college money, not enough use of the property, age, etc.
As the national economy improves, despite the best efforts of Congress to prevent recovery, pent-up demand for second homes is bringing more buyers to Summit County. As buyers become more confident that the nation won’t drop back into depression, second home sales are gathering steam. Record stock market performance has helped a lot.
One large segment of the Summit market is new arrivals to Colorado who come for jobs in tech, energy, medicine and, yes, even government. Colorado is expected to be among the top five states in job creation in 2014 and unemployment has dropped to pre-depression levels. The second thing these new hires want, after buying a home in Denver, is a second home in the mountains.
If tight supply and growing demand continues, prices will have to increase.
And there will be no significant amount of new construction to increase supply. There’s very little vacant land left to build on. The homes that already exist are about all there can be from now on.
So Summit County continues its climb back to health. This has never been a get rich quick market, though, so those in it for the right reasons aren’t worried about the slow, steady recovery at all.
60A Main St./Box 4514,
Frisco, Colorado 80443
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