Friends of Telluride ~
We hope you all have been enjoying your summer. The Telluride Real Estate marketplace has experienced a bit of a rebound in the first half of 2010. Year to date, gross dollar sales have increased 89% over that same period in 2009. Numbers of regional transactions also increased at the rate of 45%. Currently, dollar volume of sales are 55% of sales achieved in 2007, our last good real estate year pre-recession. This represents an increase of 26% when one compares 2009 sales to 2007. Sales in the region appear to be tracking better than those in Aspen where that resort’s sales have increased 22% during the same time period.
A total of 51 sales transpired in the Town of Telluride representing total gross dollars of $54.9M YTD. A total of 72 sales occurred in the Town of Mountain Village with gross dollars of $94.6M. The remainder of San Miguel County experienced 38 sales totaling $39.7M. It appears as though the upper end of the market is garnering considerable interest. There have been a total of 29 sales in the Telluride region above $2M with 15 sales above $4M and three transactions between $8M – $10.1M YTD. Another Mountain Village home with an asking price of $10.5M is currently under contract. These high end sales show a dramatic improvement as during the same period in 2009, there were only 13 sales above $2M.
While we do not anticipate a boom cycle on the near horizon, this data seems to indicate a strong renewed interest in investment in the Telluride lifestyle with its limited, high quality inventory. The catalyst for stronger sales has been a willingness by some sellers to accept price levels 20% – 30% below the market highs of 2007. Those sellers are not necessarily in “must sell” situations, but are often times seeking liquidity for alternative investments. Investors are gravitating to discounted “Grade A” properties and seem to be avoiding a limited number of problematic foreclosure and short sale scenarios.
With the velocity of sales increasing, it is likely that a “bottom” has been reached and sellers will over time resist these deeper discounts and the market will respond with gentle appreciation. Those sellers who have held firm with price structure must remain patient, but oddly have contributed to “setting the bottom” and will influence the rise in future values. Premium properties at significantly higher pricing will likely lead the market to a gentle appreciation cycle. With 12 homes transacted in the past 120 days at $800 PSF – $1,075 PSF, this cycle is likely in motion.
W e look forward to seeing you in Telluride.
TD Smith and Chris Sommers