Pitkin County Real estate dollar volume down in ‘13

Scott Condon
The Aspen Times

The dollar volume of all real estate sales in Pitkin County is down more than 10 percent from last year heading into the final days of 2013.

Sales are at $1.31 billion this year with two more days to go, according to a report by Land Title Guarantee Co. and an analysis by The Aspen Times of all deeds filed with the Pitkin County Clerk and Recorder’s Office in November and December.

Last year the dollar volume of all real estate sales in Pitkin County totaled $1.49 billion.

This year’s sales volume is down about $181 million, or 12 percent, from last year’s mark. If scheduled closings of sales occur today and Tuesday, this year will conclude with about a 10 percent decrease from last year.

Realtors said the decline isn’t a surprise but is a bit misleading. The fourth quarter of 2012 and December in particular were unusually strong because of changes in the capital-gains taxes that took effect at the end of the year. That spurred sales.

December usually is a slow month for real estate sales in Pitkin County, but it experienced a record clip in 2012 with total sales of $269.71 million. This year, December sales totaled $77.69 million as of Friday. The decline in December accounted for the overall decline for the year.

“Up through November, the year compared favorably to last year,” said Tim Estin, a broker associate with Aspen Snowmass Sotheby’s International Realty.

Craig Morris, a partner in Aspen Snowmass Sotheby’s International Realty, said there was well over $100 million in real estate sales in December 2012 that would have been deferred until 2013 or possibly wouldn’t have been completed without the changes in the tax code.

Bob Starodoj, president of Coldwell Banker Mason Morse, said December 2012 was “nuts” and produced a dollar volume that likely won’t be matched for that month for years.

Both Morris and Starodoj said 2013 was a solid year for the Aspen-area real estate market even if dollar volume doesn’t match that of last year.

“Generally speaking, the market is getting healthier,” Starodoj said.

He said the number of transactions jumped in 2013 even if the dollar volume didn’t. That means more sales at lower prices. There weren’t as many sales of high-end properties above $10 million.

“There are a whole lot more transactions, but they weren’t in that stratospheric level of $10 million and above,” Starodoj said.

There were 749 real estate transactions all of last year. That includes everything from deed-restricted employee housing to mansions on Red Mountain. So far this year there have been 1,696 transactions. Land Title Guarantee Co. said in its report for October that the transactions have been “inflated” this year by an incredibly high number of fractional-ownership sales. But even if fractional sales are thrown out, transactions are still up significantly, according to real estate agents.

Morris said real estate agents at his firm, the largest in Aspen, feel that the market has experienced a slight improvement over the prior year each of the past three years.

“Inventories are on the decline,” Morris said. “I wouldn’t say it’s a sellers market yet, but it’s headed that direction.”

To put 2013 in perspective, it topped 2010 and 2011, which saw sales of around $1.265 billion both years. It was slightly more than half of the pre-recession record level of $2.52 billion in sales in 2007.

Estin said some segments of the upvalley real estate market really shined in 2013.

“The biggest trend for the year is probably the resurgence of the Snowmass (Village) condo market,” he said.

There were 42 sales of condominiums in Snowmass Village in all of 2012. There were 107 through Dec. 1, he said. Most of the sales are at the Viceroy, and even though prices are discounted drastically from pre-recession listing prices, the dollar volume is still soaring because of the sheer number of sales.

“They’ve added great energy to the market,” Estin said, adding that it’s broadened interest among buyers beyond the Viceroy.

Single-family home sales also are bouncing back well in Snowmass Village this year. There were 21 single-family sales in all of 2012 compared with 27 this year through November, according to Estin’s research.

“Aspen has been doing well but not as well as Snowmass,” Estin said. He noted that Snowmass Village’s market hit bottom in recent years, so it shouldn’t be a surprise that it finally is improving. It is “almost like it was at ground zero,” he said.

Estin produces a monthly report that looks at sales for Aspen and Snowmass Village rather than Pitkin County as a whole. The year-to-date dollar volume for sales in Aspen and Snowmass Village was down about 4 percent through mid-December, his report showed, while unit sales are up 26 percent.

“I think there was probably hope that it was going to be better than last year,” Estin said of the mood among upvalley real estate agents. A lackluster December compared with the same month last year dashed that hope.

The increase in transactions coupled with the decrease in dollar volume has produced different perceptions among buyers and sellers. Estin said many sellers are convinced that the market has turned and that prices “should be rising.” But buyers in every price category are still seeking bargains, according to Morris. The difference between the listing prices and the selling prices is at least 20 percent, on average, he said.

In other words, buyers aren’t just looking for deals — they are demanding them.

Starodoj said midvalley activity, which includes parts of Basalt and El Jebel in Eagle County and Carbondale in Garfield County, is skyrocketing. Multiple offers are being made on homes priced under $500,000, he said. That hasn’t happened since 2007.

Starodoj and Morris said their firms anticipate continued growth in 2014.

“It’s going to be a gradual improvement. It’s not going to be a hockey stick,” Starodoj said, discounting any spike in dollar volume.

Morris said the shrinking inventory combined with a “slight uptick” in new construction makes it seem logical that there will be upward pressure on real estate prices overall. There is greater demand for newly built residences, so there is premium pricing. That helps raise the entire market, he said.

Estin said among the factors boding well for the upvalley real estate market for 2014 is the record-high level of the stock market.

“As the stock market goes, so goes Aspen,” he said.