Aspen, Colorado: A Strong Real Estate market in December begins showing signs of Slowing down in moths after, however, Erik Cavarra believes the overall market is improving. With Supply & Demand Ratios returning to favor less supply it will put the pressure on demand. In certain cases it is difficult to find properties for Buyers, that is showing an increase in the Market and increases the simple business principles of Supply vs. Demand. It’s exciting to see a better market and Buyers are still obtaining fabulous deals.
The fantastic finale to 2012 in the Pitkin County real estate market has
given way to a sluggish start in 2013.
The total dollar volume of all
real estate sales in January was down $15.15 million, or 15 percent, from
January 2012, according to deeds filed with the Pitkin County Clerk and
Recorder’s Office.
The sales slump continued in February, with dollar
volume down another $9.1 million, or 20 percent, according to deeds
filed.
For the two months combined, the market is down $24.25 million, or
17 percent.
Realtors said Friday that the surge in late 2012 and the
slump in early 2013 are connected. A flurry of activity in the fourth quarter of
2012 was driven by changes in the capital-gains tax laws. Sales that would have
been completed in January and February of this year were fast tracked in
December.
“Buyers and sellers were doing back flips to get closings done
in the last days,” said Carrie Wells, a leading real estate agent with Coldwell
Banker Mason and Morse Real Estate in Aspen. Work in December for real estate
agents, title insurance companies and real estate attorneys was like “running a
marathon,” she said.
Wells said she represented the buyers in one
transaction in which an offer was made for a home on Christmas Eve with a
closing on Dec. 27. The buyers knew they would benefit from a discount, so they
agreed to a deal that skipped many of the due-diligence steps, and they allowed
the sellers to remain in the property for six months, she said.
Buyers
aren’t willing to jump through hoops like that now, and sellers don’t have the
incentive to reach an agreement because of higher taxes, Wells said. Therefore,
activity has sagged.
In January, all sales totaled $81.50 million
compared to $96.65 million for January 2012. It was the worst performance for
the month since 2010.
This February was the worst in at least a decade.
Sales totaled only $36.26 million compared to $45.36 million in February 2012
and $115.92 in February 2011.
“It’s a little slower than we were hoping
for,” said Craig Morris, a partner in Aspen Snowmass Sotheby’s International
Realty, the upper valley’s biggest real estate firm.
Like Wells, he said
the 10 percent increase in the capital-gains tax spurred so much activity in
late 2012 and affected activity to start this year. “Buyers knew that sellers
would be a little more motivated to sell in December,” he said.
Total
sales volume soared to $269.56 million in December, making it the strongest
month of 2012. Sales were up 247 percent from December 2011.
Morris said
that if you took sales for the last three months and divided by three, it would
produce three average months.
One glaring development so far this year is
the lack of big sales. In January, there was one sale for more than $10 million.
The next-highest sale was $6.3 million.
February featured a high sale of
$7.5 million and three above $3 million.
In contrast, there were four
single-family-home sales of $11 million or more just between Dec. 20 and
26.
“The inventory has thinned out quite a bit” in the $10 million-plus
range, Morris said. There are 62 properties currently listed for more than $10
million in Aspen and Snowmass Village in the Multiple Listing Service. He
estimates that is 30 percent less than the inventory of one year
ago.
Both Morris and Wells anticipate activity picking up this year. The
good news for the real estate industry in Aspen is January and February are the
two slowest months, so decreases in dollar volume can be offset. Wells said she
expects a strong summer with activity matching traditional levels.
The
“feeder markets” for Aspen — major metropolitan areas where many buyers come
from — are seeing strong real estate activity, she said. That typically
translates into purchases in Aspen and other mountain markets. The major feeder
markets include Los Angeles, Chicago, New York and Miami.
Morris said the
number of showings is strong there, indicating that people are interested in
buying. He has a $50 million house in Wildcat under contract for later this
spring. He said he had five showings of properties priced at $10 million or more
on Saturday.
Those indicators lead him to believe that 2013 will compare
favorably to last year.
“I think it’s going to be similar,” he said. “I’m
optimistic it’s going to be slightly better.”
Sales totaled $1.49 billion
in Pitkin County in 2012, or an increase of 17.5 percent over 2011. Last year
was the best since 2007.
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