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Greetings
July’s Sales Dollar Volume was up 50 % and the number of
transactions was identical to July 2006.
YTD we are 3% higher in Dollar Volume and down 9% in number of
transactions. 2006 was a record breaking year.
Going into this summer, I honestly thought that the Peaks Hotel
summer closure could slow the local real estate market. The hotel services
a very high percentage of first time visitors to the region, who often
become buyers. The YTD numbers do not reflect a slow down.
Transactions are down due to the local or first-time home buyer market
segment. When interest rates were very low, it converted many renters into
buyers of low end condominiums under $500,000. This is probably the
weakest segment of the market now. It was a little over done as
locals were buying and selling which ran up the number of transactions.
The strongest segment in our market includes the high end homes, ski
in/out homes, high end condominiums, and a handful of large compounds in
smaller subdivisions outside of Town. I see this as smart money being
put to work in a safe real estate market with low inventory.
How can I write this letter without mentioning the current mortgage
meltdown? Is it serious? I think so. Will it affect our
market? It may slow down buyers in the next 4 weeks, but
probably will not impact us as much as it will impact other markets in
the Country. The reason for this is inventory. The
local inventories are lower than last year. It takes too long to
bring product to the market here. As with most things, time will
repair the current mortgage crisis.
Attached is an article from Aspen Sojourner, a publication in which I
often advertise. The article presents a graph of a single family homes in
Aspen starting in 1985 to 2006. It shows major negative events that
have affected our country. Aspen development started sooner than Telluride
development and is ahead on the curve. We are trailing them. What I
would like you to take from the article is the following:
- The chart of course
- The differences in prices between Aspen and Telluride. Currently, if
we put the average price of a Telluride single family home on the Aspen
Chart, we would be in the early 1990's.
- Notice how much higher their dollar per square foot is as compared to
our market. The article does not compare Aspen to Telluride. Take in
their stats and compare them to information that I have sent you or to
other Telluride MLS information.
- Lastly, they comment on the swift movement in their property
values in the last three years. During the same time
period, Telluride experienced steady, healthy price increases, not
comparable to the escalation in the Aspen market.
For a quick Telluride segment update:
- Town Condominiums under $1M will see prices cuts in the next six
months.
- Livable, ready-to-move-into Homes under $2M continue to disappear in
the Town of Telluride and in TMV.
- Aldasoro is gaining strength due to the appreciation of TMV golf
course lots over the last three years.
- TMV condos under $1M are disappearing quickly, while no one is
building new condominiums to sell under $1M.
- The high end of the market is doing fantastic.
(These updates are my personal thoughts, and are supported through the
MLS data.)
A very good land opportunity is available. The details are
below.
Hope to see you in Telluride soon.
Rick Fusting
Peaks Real Estate
Sotheby’s International Realty
970.708.5500
Email Me
www.Telluride-Colorado.com
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