Telluride Real Estate Market – Our Upward Trend
Telluride Daily Planet – Market Update
Featuring Brian O’Neill
The Telluride-area residential real estate market has been slowly rebounding since the Great Recession of 2008-2010, as proven by comparing 2016 data against figures from 2007, generally considered the market’s best year.
The information comes from Brian F. O’Neill, director of Telluride Properties, who recently prepared an update on area real estate trends for his clients and shared the information with The Daily Planet in an interview last week.
“When comparing 2016 to 2007 (our finest year),” O’Neill wrote his client report, “it is interesting to note that sales of homes and condos in both towns tell interesting stories, while the overall market data for those years exhibit the new normal.”
O’Neill also looked at comparable markets, including Aspen and Jackson Hole, Wyoming, which suffered (relatively speaking) in 2016 after several strong post-recession years. Telluride avoided the slump many other luxury markets across the nation, including the Hamptons in New York, experienced, continuing its pattern of slow and stable growth, O’Neill said.
“Fortunately, Telluride has maintained a more controlled growth rate that appears sustainable into the future, in part due to the tremendous community unlike any other mountain town whereby buyers are buying for enjoyment versus investment because they consider Telluride their home now and/or in the future,” he said.
Here’s a snapshot of a few of the local market segments O’Neill included in his client update:
• Telluride condominiums: In 2016, there were $71 million in sales representing 78 transactions, for an average sale price of $910,000. In 2007, there were $58.5 million in sales representing 67 transactions, for an average sale price of $874,000. Thus, total sales increased 21 percent when comparing closings from 2007 to 2016.
• Mountain Village condominiums: In 2016, there were $103.5 million in sales representing 95 transactions, for an average sale price of $1.09 million. In 2007, there were $120 million in sales representing 81 transactions, for an average sale price of $1.48 million. Thus, while total sales decreased from 2007 to 2016, the number of transactions was 17 percent higher.
• Telluride homes: In 2016, there were $60.2 million in sales representing 27 transactions, for an average sale price of $2.23 million. In 2007, there were $67.7 million in sales representing 32 transactions, for an average sale price of $2.12 million. Thus, although total sales and transactions declined from 2007 to 2016, last year’s average price was $18,000 higher than the pre-recession figure.
• Mountain Village homes: In 2016, there were $69.2 million in sales representing 20 transactions, for an average sale price of $3.46 million. In 2007, there were $144.7 million in sales representing 40 transactions, for an average sale price of $3.6 million.
Of this decline, O’Neill says, “(Mountain Village) home sales have remained slow in part due to a lack of newer inventory and the (rising) opportunities in condos.” And, a lot of homebuyers prefer to purchase in Telluride because of the convenience: the proximity to stores and other public amenities.
During last week’s interview, he spoke of the tremendous purchasing opportunities in the Mountain Village condo market, “thanks to the large inventory.” In general, buyers can get more for their money with Mountain Village residential purchases, especially in the condo market, than in Telluride, where there is an inventory shortage.
O’Neill also talked about last month’s sales totals in the Telluride-area residential market, perhaps a harbinger for the year to come. January 2017’s $49 million outpaced January 2016’s $38 million, nearly a 30 percent increase.
“It was one of our biggest Januarys, and it’s not uncommon to have a big January after an election year, because people get through the election and they start buying property,” he said. “All of a sudden, the closings start happening in January.”
As for the rest of the Telluride region, within and outside of the immediate Multiple Listing Service, O’Neill said Norwood and Ridgway are doing well with regard to single family home sales. Prices are not nearly as high as they are in Telluride and Mountain Village, where many workers are willing to commute to their jobs from the outlying areas while saving money on mortgage payments.
The ranch property market, which he defined as 35 acres or greater, is a bit sluggish, and Downvalley home sales are slow, perhaps because owners are asking too much.
“There are better opportunities in other locations,” O’Neill said. “Ridgway is poised to become the next Carbondale. Norwood is going to keep growing. A buyer can get more for their money in Ridgway and Norwood.”
Sally Puff Courtney, a longtime local broker and vice president of Telluride Sotheby’s International Realty, said one interesting aspect of the local market is that when Telluride does well, Mountain Village slows down, and vice-versa.
“When Telluride is on fire, Mountain Village is the opposite,” Courtney said.
An issue in Telluride, she said, is that prices will continue to climb in the near future because there aren’t a lot of available lots on which to build new homes. The existing homes that are part of the local inventory will sell at higher prices than before, and new home construction costs will continue to climb because of rising costs of property, building materials and labor.
Opportunity for buyers, Courtney says, may lie in Mountain Village, where sales of both homes and condos are picking up, due in part to larger dwellings and greater supply.
“We’ve sold four homes in Mountain Village in the last couple of months,” she said. “Mountain Village is coming back. Things are really starting to sell up there.”