TELLURIDE – While the Telluride and Mountain Village real estate market has shown signs of vitality this year in the number of sales through May, it remains a buyers’ market as sales continue to be value-driven.
But with other Colorado resort economies resurging, there is reason to believe Telluride’s market will be making a comeback of its own, possibly beginning a shift toward a sellers’ market.
Real estate numbers released earlier this month by Judi Kiernan of Telluride Consulting indicate that the overall number of sales is improving while the actual dollar amount of those sales continues to lag. Through May, there were a total of 193 real estate sales in San Miguel County, which is up from 135 sales for the same time period in 2010. (There were 85 sales in 2009 at the height of the market crash.)
Although the number of sales has steadily increased, the dollar volume represented by those sales has not kept pace. Year-to-date sales in 2010 brought in $168.6 million. Even though 2011 has seen more sales, the dollar volume significantly dropped to $114.8 million from the previous year. (In 2009, the dollar volume in sales was $75.9 million.)
“I think we are doing pretty well,” Kiernan said. “We are considerably above the 2009 year-to-date in terms of dollar volume and this has been the best in four years in terms of the number of sales.”
Peaks Real Estate Broker Sally Puff Courtney said her office has had an encouraging 2011 and she attributes the success to the proper pricing of properties in relation to today’s market.
“It is really important that we get sellers to understand where the real market is,” Courtney said. “I think we have stabilized but we haven’t seen any upward movement quite yet. This is still a buyers’ market. If properties are priced according to today’s market, then they will sell.”
But just where is today’s resort real estate market in Telluride?
While much of the nation’s real estate values are at rock bottom lows, Kiernan said resort real estate markets need to be looked at differently. Undoubtedly, market values have dropped in Telluride and Mountain Village but not as much values in even weaker economies.
“We are not in a fire sale mode,” she said. “We are not anywhere near what the national economy leads you to believe. Our high-end sellers have been willing to drop prices anywhere from 20-30 percent, which is more than a normal 5-10 percent discount we had in a strong market. There is so much in the national media about the notion that we haven’t hit rock bottom yet and I think we really need to look at resort markets as different from the general market.”
George Harvey, at The Harvey Team, believes the national real estate recovery will be gradual and slow but that doesn’t mean properties won’t sell. His biggest challenge, he said, it getting sellers to understand where a sellable price is in the current real estate market.
“When people ask me, ‘How’s the market?’ I want to re-ask the question and ask, ‘For whom?’” Harvey said. “The market is terrific for buyers. It’s the best I have seen in 25 years. It’s good for sellers who price their property to the current real estate market and not the market of two or three or four years ago.
“I think every broker you will talk to will say there are buyers for real estate in the Telluride region and they will buy if the properties they are looking at are priced to this mark. Right now, we have too many listings at prices from two or three years ago.”
Shift From Buyers’ to Sellers’ Coming Soon?
Most Telluride real estate brokers will agree that the Telluride region tends to lag behind the larger Aspen and Vail real estate markets. So far in 2011, real estate values in those two markets are slightly below 2010 values, but those markets have also seen a spike in the number of sales this year, which is good news for Telluride.
Through the month of April, according to Land Title Guarantee Company figures, there have been a total of 407 sales in Eagle County, which is up from 392 the previous year and is more than double the mark of 199 sales set in 2009.
First quarter figures for Aspen’s Pitkin County are similar. Through the first three months of activity this year, there have been 196 sales. If this pace keeps up throughout 2011, the number of sales will significantly beat last year’s total of 689, 2009’s total of 702 and will be close to 2008’s total of 828 sales. The increased number of sales in those two markets have brokers in Telluride in a hopeful mood.
“Those Vail and Aspen markets have made somewhat of a comeback,” Telluride Properties broker Brian O’Neill said. “The basic phenomenon is that we have a tendency to lag behind those markets by about six months. When people in our market see that Aspen has picked up, they will see that now is the time to get in the Telluride market.”
On top of that somewhat encouraging news, O’Neill recently read that the economies across the country have continued to decline except for Texas, which has gone up for the first five months of this year, mainly due to oil sales. With an improved economy and low sale prices, now could be an optimal time for Texas residents to purchase their vacation home in Telluride.
“The mood is somewhat hopeful throughout the brokerage community,” O’Neill said. “There have been a lot of showings for this time of year. The interest has picked up and that is creating some optimism in the market, which dovetails on our tendency to lag behind the Aspen and Vail markets. That is definitely a good indicator for us.”
Telluride Real Estate Broker Steve Catsman agrees that the spike in sales in Aspen and Vail is a good indicator and reports that the mood in his office is upbeat as well.
“I have actually been networking with brokers in Vail and Aspen to expose Telluride more,” Catsman said. “I think they have buyers that are not satisfied with their options and they may be ideally suited for the Telluride market.”
Catsman went on to say that his office is seeing a lot of activity right now and more than ever, it’s a responsibility for brokers to educate buyers that everything in Telluride is not a fire sale and that a good value in Telluride’s market doesn’t necessarily have to be a market sale.
“As things pick up, it becomes less of a buyers’ market,” he said. “A sellers’ market may be some time off but what I would call a normal market is just around the corner. Given the Telluride lifestyle and an increasing demand for this type of lifestyle, it will put us back on track.”
“People are realizing they still love Telluride and the region,” Harvey said. “They are still looking for that special place and, to many, Telluride fills that need. I am going to say I think the worst is behind us. None of us have a perfect crystal ball, but I will say this. If you are a serious buyer, you need to look now.”