Business Monday: Declining real estate inventory means seller’s market in Aspen area

This new home on Hallam Street in Aspen's West End is listed for $10.995 million. Housing inventory is down in the Aspen area and has led sellers to command higher prices.
Rick Carroll/The Aspen Times

It’s a seller’s market in Aspen-area real estate because of the continued decline in inventory.

That’s been a common theme among property brokers keeping an eye on the dips and rises in the local market, which has seen residential inventory drop 40 percent over the past five years.

As of Friday in the Pitkin County market, 150 single-family homes were listed for sale, down from 167 last year; 119 condominiums were on the market, down from 152 in 2017; and 43 pieces of land were for sale, down from 49.

“The simple answer to this is we got to a point where the market was slower about eight or nine years ago and the inventory started to build up and buyers started having more confidence,” said the gatherer of that data, Andrew Ernemann of Aspen Snowmass Sotheby’s International Realty. “More buyers have been showing up so now what we’re seeing over the last few years — I don’t want to say it’s a shortage; there are plenty of homes — but there definitely is a dearth of inventory for price points in some locations.”

New listings also have dropped. There were 31 new single-family listings in Aspen from January through April, down 26.2 percent from the 42 listings for the same period last year, according to data from the Aspen Board of Realtors.

In his May 11 newsletter, broker Bill Stirling of Douglas Elliman Real Estate said the trends have made clear fewer properties are for sale and the market is cooling.

“In the past three months, the Aspen housing market is continuing to see trends established last year with rising prices, larger-sized sales and the clearing of older inventory,” Stirling said. “However, we have 30 percent fewer properties under contract than last year at this time. This could mean a slightly slowing of the market, but the best properties and the best priced properties are still selling.”

Tim Estin of Sotheby’s said this year could be on the same path as 2016, which wasn’t terrible but looked considerably off compared with the year prior.

Sales volume in Pitkin County last year totaled $1.9 billion, 2016 accounted for $1.37 billion and 2015 reached $2 billion.

In his May 14 newsletter, Estin reported that April posted 16 sales compared with 24 in April 2017.

The reason, Estin theorized, “In the past four years, inventory of Aspen properties for sale peaked at 460 units in April 2016 versus 312 in April 2018, down 32 percent. Less offerings, higher prices may be slowing us down. Buyers get discouraged.”

Buyers have been most bullish toward downtown Aspen, where seven single-family homes are listed for sale, three of which are under contract; along with 60 condos and townhomes, 13 of which are under contract, Ernemann noted.

Ernemann and James Benvenuto, also of Sotheby’s, said the newly finished homes are attracting much of the interest.

“Product that’s new on the inside and new on the outside, that’s the stuff that’s going quickly,” Benvenuto said, noting that condo availability downtown is particularly limited.

Amy Doherty of Douglas Elliman agreed in her May 7 report.

“Our inventory is particularly limited for core condominiums/townhomes where there have been more sales in the past year than there are listings currently,” she said.

Snowmass Village, meanwhile, is seeing an uptick in demand in large part because of the bounce-back of Base Village. There are 66 single-family homes listed in Snowmass, the most since the 77 in 2012. The availability of condos and townhomes, however, is down — 140 are on the market compared to 176 last year.

“Finally, after several false starts, the Base Village project is back on track with solid ownership and an impressive amount of construction activity taking place,” Ernemann wrote in his most recent newsletter. “The psychological impact of new vertical construction and investment dollars injected on and off the mountain in Snowmass Village has percolated through the local real estate market.”