but signals are mixed about how fast

The Summit County real estate market is showing a very mixed bag of signals, just like the National economy. For every sign of improvement, another sign of continued weakness can be found. Some examples:
In the first half of 2010, there were only 471 total sales, about half the average number for the past 20 years. But that is a 33 percent improvement over last year’s first half sales.


The average sale price is now $552,400, within 2 percent of last year’s average to date. But take away the 33 One Ski Hill Place condominiums that closed in May and June at an average $1.4 million and the average sale price drops by 13 percent.
Buyers at One Ski Hill Place and Crystal Peak Lodge, which closed 48 units in 2008 at similar prices, had extremely large amounts of earnest money at severe risk of loss if they did not close on units that they’d committed to a couple of years before. Both complexes moved the average price a great deal in the years when they closed. They can’t be ignored, but you need to understand the circumstances of the sales.
Certain sectors of the market have fared worse than average, others better. Resale condominiums are down 12.4 percent in average price year to date, and down about 25 percent from the peak in 2008.


Single family home prices have held up well… until this year when the first time buyer tax credit added enough lower priced sales to drop the average by 15 percent year to date. By year-end, that effect will be diminished by a more normal mix of home sales. Average home prices will probably be in line with 2008 and 2009, certainly around $900,000.



Land sales are still in the basement. Only 32 lots have sold in the first half of 2010, although two of them went for over $1 million, and 65 sold in all of 2009. There used to be 65 land sales in a month.
Land represents the most under valued sector of our market and the sector with probably the most potential for appreciation. Nearly all private land in Summit County has been subdivided to it’s highest density and nearly all of what is left unbuilt is zoned single-family. When construction loans become available again, pent-up demand will cause the little vacant land remaining to be snapped up.
Sales volume will probably increase this year to about 1400 sales, near the number in 2008. That will be over half the peak number of properties listed for sale this year, probably about 2700. The diminished inventory will help stabilize prices and allow for some price increase in 2011 as sales approach the 20-year average of 2000.
Lenders are showing signs of regaining their sanity at last and are putting some of that bail-out money back into the economy. Investors are buying jumbo loans for the first time since 2008 and condominiums are slowly becoming respectable to lenders again. It will take 25 percent down and perfect credit, but loan availability is slowly increasing.
Denver and the surrounding area from Wyoming to Nebraska and Iowa are recovering from the Great Recession faster than many other parts of the country. Every month new businesses are bringing thousands of new, high paying jobs to Colorado. Real estate in the Front Range is recovering and there are bidding wars for properties in certain price ranges.
Denver is a good leading indicator of Summit County’s future activity. The first thing new residents want to do after moving here is to get a place in the mountains.
There is a window of several months here for buyers to take advantage of this historic drop in prices and increased seller motivation. But by this time next year, the best opportunities, the screaming bargains, will be gone.
When the indicators are all negative or all positive, it’s easy to call the next market developments. When the indicators are as mixed as this, it usually means that the economy is on the verge of recovery. It’s just the hardest time to believe it.
After the recovery, once again there will be many who will remember when they could’ve bought for a fraction of future prices. It takes guts and foresight to get rich. Right now there are some who are laying the foundation of their future prosperity by investing in opportunities that others just can’t see.

Chuck Leathers, CRS
Owner/Broker

888/485-2300

60A Main St./Box 4514,
Frisco, Colorado 80443
E-mail me at chuckleathers@realtor.com

Go to http://www.chuckleathersre.com/ to see all Summit County listings