Total sales for the first quarter is on par, in both dollars and numbers, with the first quarter of 2014, the latter registering the highest gross dollar sales since 2007. The modest downturn of Historic Town of Telluride sales is largely the result of a lack of quality inventory, which was seriously depleted during 2014. The increase in gross dollar sales of Mountain Village condominiums and homes in the first quarter of this year helped maintain overall market stability as compared to the first quarter of 2014. Currently as of March, $83.3M in transactions are under contract with $41M closed in March alone, with almost $92M closed YTD.
How the Major Market Segments have performed:
Town of Telluride
Town of Mountain Village
Remainder of County
Specific Sub-market Segment Performances of Note:
With the increase in commercial leasehold rates within the Historic Town of Telluride and redevelopment opportunities of commercial structures, the commercial segment of the market has rebounded dramatically since the beginning of 2014. Values of this property type have increased nearly 50% since the end of 2013. For value driven investors, Telluride Mountain Village homes and condominiums continue to be quite attractive together with regional homes. For those interested in a design / build process, excellent vacant ground opportunities exist in nearly all market segments. With the lack of standing inventory in the Town of Telluride, we believe that vacant lots will be a focal point for investors / developers this summer.
Note: Background statistics provided by Telluride Consulting and the Telluride MLS
With 2013 year-end sales holding steady verses 2012, the first quarter of 2014 registered the largest dollar volume of closings in six years. The months of January, February and March demonstrated increases over those same months of 2013 by 116%, 25% and 45%, respectively. Total combined first quarter sales outpaced 2013 by 47% ($94.2M vs. $63.9M). As we enter the summer season, a robust first quarter bodes well for the entire year, as the summer marketplace has out-performed winter sales over the past two years. Another strong indicator of continuing market strength — 79 properties are currently under contract with a total sales volume of $104.4M. Assuming a majority of those transactions close in the second quarter, momentum will most certainly continue in the Telluride regional marketplace.
Of the three major market areas (Town of Telluride, Mountain Village and Remainder of County), Historic Telluride experienced the most dramatic increase in volume of 112% ($42.7M vs. $20.1M), followed by the “County Sales” with a percentage increase of 61% ($14.8M vs. $9.2M) and Mountain Village — plus 7% ($36.5M vs. $34.2M). Of particular note, Town of Telluride (TOT) condominium sales nearly tripled ($21.9M vs. $8.1M) and the sales volume of TOT homes more than doubled ($11.9M vs. $5.2M). Telluride Mountain Village (TMV) condominium sales, that had experienced a sales volume increase in 2013 of 51%, continued a brisk pattern of sales ($13.2M vs. $14.7M). The sale of TMV residences continues to be a bit soft with $10M in first quarter closings, however, with $15.6M currently under contract that market appears to be rejuvenating as investors realize excellent value in that market segment.
Although a quarterly “market snapshot” as to value in a boutique real estate marketplace such as Telluride can be difficult to ascertain with a great deal of accuracy, the average home sale price of the combined TOT and TMV markets in the first quarter was $2.8M. Year-end statistics for 2013 revealed an average of $2.2M. The overall average price per transaction in the first quarter was $890,000 vs. $834,000 for the entire year of 2013. As the market continues its upward momentum, increased values and velocity of sales should follow suit, as has been witnessed in the Historic Town of Telluride market.
Note: Background statistics provided by Telluride Consulting and the Telluride MLS
After a record setting December of 2012 ($76,000,000 in gross sales), probably the result of investors desire to close by year end due to potential tax code changes, the Telluride marketplace “played catch up” for most of 2013. Very strong months of May, August and September where sales outpaced the prior year by 49% led to a bullish December with $65.6M in transactions, but short of matching the prior December. A reduction of 6% ($342.2M vs. $364.7M) in gross dollar sales volume is not surprising given the year end market anomaly of 2012. The past year was the second strongest market in both gross dollars and number of sales since the height of the market in 2007.
Although sales in the Mountain Village declined 13%, 2013 gross sales of Telluride Mountain Village (TMV) condominiums increased 51% ($79.8M vs. $53.0M). Town of Telluride (TOT) condominium sales increased slightly 6.5% ($43.9M vs. $41.2M). TMV homes are lagging behind the market with $27.8M closed in 2013 vs. $76.1M for 2012. Of particular note, commercial real estate sales in the TOT climbed 67% ($14.9M vs. $8.9M) as leasehold and occupancy rates have dramatically increased. The balance of San Miguel County remained stable this past year with 2013 sales of $82.5M vs. $87.8M during 2012.
Given that nearly 60% of 2012’s real estate transactions closed as the result of contracts and closings occurring from August through the end of the year, 2013 tracked in the same manner as sales in 2012, so it is becoming apparent that the summer / fall selling season is outperforming the winter. This same indicator seems to be present in statistics for retail sales tax as well. Summer tax revenues have eclipsed winter in the recent past.
A very good indicator for the upcoming year is the fact that $93.1M in transactions are currently under contract. The Town of Telluride has long been the market leader and as Historic Telluride goes, the balance of the marketplace soon follows suit. Town of Telluride residential homes and condos have witnessed 21 contracted or closed properties in the past 24 months securing $950 + PSF at price levels between $2M and $6M – - Hopefully a very good indicator for the balance of the marketplace.
Let us know if we can provide you with any specific market data and hope to see you on the slopes this winter.
After a record setting December of 2012 ($76,000,000 in gross sales), probably the result of investors desire to close by year end, the Telluride marketplace “played catch up” throughout the winter, spring and early summer of 2013. Uncertainty related to potential tax code changes in 2013, incentivized both buyers and sellers to culminate transactions in December of 2012 that might otherwise have occurred in 2013. A very strong 3rd quarter that was up 29.8% over the 3rd quarter of 2012, placed gross dollar sales 6% ahead of last year’s sales ($225M vs. $212M) with August and September closings up 56% and 63%, respectively, over those same months of 2012.
Of particular note, YTD 2013 Telluride Mountain Village (TMV) condominium gross dollar sales have increased 53% ($52M vs. $33.9M). Town of Telluride (TOT) condominium sales increased 22% ($27.5M vs. $22.5M). The average price per incident of TMV condo sale increased from $873,000 to $918,000, while the same data related to the TOT was $739,000 to $842,000. The sale of TOT homes has remained relatively stable ($30.7M vs. $33.1M), as has the average price per incident of sale ($1.8M vs. $1.9M). TMV homes are lagging behind the market with $24.4M closed YTD vs. $36M for the same period of 2012.
Given that nearly 63% of 2012’s real estate transactions closed as the result of contracts and closings occurring late summer through the end of the year, and 2013 appears to be tracking in the same manner, it is perhaps becoming apparent that the summer / fall selling season is outperforming the winter. This same indicator seems to be present in statistics for retail sales tax as well. Summer tax revenues have eclipsed winter in the recent past.
A very good indicator for the upcoming last quarter is the fact that $83M in transactions are currently under contract. It is highly unlikely that we will experience the same burst of sales in the month of December as was experienced in December of 2012. However, the market is likely to exceed $300M in gross dollar sales, but fall short of the $364.7M of 2012. The Town of Telluride has long been the market leader and as Historic Telluride goes, the balance of the marketplace soon follows suit. Town of Telluride residential homes have witnessed 26 contracted or closed properties YTD with 6 homes securing $1,000 + PSF and 10 homes sold or contracted between $2M and $5.9M – - Hopefully a very good indicator for the balance of the marketplace.
Let me know if I can provide you with any specific data related to any market segment.
See you on the slopes this winter,