Riding the real estate roller coaster | AspenTimes.com

Riding the real estate roller coaster

Even some of Aspen’s most exuberant real estate boosters acknowledge that the second quarter of 2003 was “a disaster.”

While the total number of condominiums, single-family homes and lots sold and under contract in Aspen increased from 141 during the first half of last year to 175 during the first half this year, the dollar volume fell from $349.70 to $298.89 million this year, according to statistics tracked by B.J. Adams and Co.

The real estate market in Snowmass Village faced an even tougher time. The number of sales and deals under contract fell from 82 to 74, while the dollar amount plummeted from $161.81 million last year to $85.82 million this year, according to B.J. Adams and Co.’s report.

No one was making any decisions about real estate sales immediately before and during the war in Iraq, according to Bob Ritchie, a longtime Aspen real estate agent and partner in Coates, Reid and Waldron. “Everybody was watching TV – brokers, buyers, sellers,” he said.

When you throw in the sales and deals under contract from the midvalley with Aspen and Snowmass Village, here’s what it shows about 2003 through June: The total transactions increased from 363 to 392; sales volume dropped $122.66 million, or 22 percent, to $449.33 million.

B.J. Adams and Co. used sales data from the Aspen Board of Realtors’ Multiple Listing Service to calculate its report. It eliminated duplicate sales to come up with an accurate picture. It also added in deals under contract.

Soft sales have contributed to a glut of property on the market. At the current sales pace, it would take four years to sell all the homes, condos and lots currently listed for sale, according Ritchie. During the last seven or eight years, the inventory was typically only half that large, he said.

Adams said the market today has created “a great divide.” Buyers believe the fragile economy might produce more motivated sellers. They know they have lots of choices so they aren’t frantic about making a purchase. They believe the market is finally on their side.

But Aspen-area sellers aren’t typical, Adams noted. They are wealthy enough that they aren’t desperate to make a sale and would rather wait to try to get their asking price. They are content to have their money tied to Aspen-area real estate rather than in a questionable stock market, so they will wait.

Ritchie said there’s been consistent appreciation on Roaring Fork Valley property for almost a decade. Some of it has shot up 25 percent during that period. Now there is very little appreciation. Yet average sales prices haven’t tumbled because sellers can afford to be patient.

Despite the gloomy first half of the year, local real estate agents have taken heart recently. Buyers started poking around with a vengeance right around the Fourth of July. Ritchie said there’s an outside chance that mid- and upper-valley real estate sales could top $1 billion.

Adams isn’t quite that optimistic, although she expects a solid year if there isn’t another tragedy like the September 11 terrorist attacks or even bleaker times for the national economy.

She anticipates a busy August and September. Nevertheless, her enthusiasm is guarded. “It’s not going to be a blockbuster like it was in 1999,” she said.

Wendy Lucas, a real estate agent with the Roaring Fork Land Co. and listing broker with the Willits subdivision, said she’s “bullish” again on the midvalley market after a three-year slump. Property values are starting to creep upward after a decline of between 5 to 10 percent over the last three years, she said.

The success at Willits, a massive subdivision partially built just upvalley from the El Jebel City Market, is the prime reason for her enthusiasm. It’s a hot spot for residential and commercial development right now.

There are currently four single-family spec houses under construction along with three that will be owner-occupied, according to Lucas. The Alpine Bank commercial building and a service station will also be completed by fall.

Of nearly 155 homes sites at Willits, one-half are available for sale. Of those, 75 percent are developed, Lucas said.

Ritchie said there are signs of strength throughout the mid- and upper-valley real estate market, due to the type of people it attracts.

“The richest people in the world, or a good share of them, are our buyers here,” Ritchie said. “[The Aspen market] is a big Rorschach test on the psyche of the wealthy in America.”

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