At the time I was conducting research for this article, Coronavirus had yet to rear its ugly head. My 37 year real estate career has spanned several downturns and recoveries, including the 1980s oil and savings & loan collapse, the stock market crash of the later 1980’s, the tech bust & 9/11 attacks in the early 2000’s, and most recently, the mortgage meltdown and great recession of the late 2000’s. As of this writing no one knows how the Covid-19 pandemic will affect our lives. From a real estate market perspective, the answer to that question may not be known for months, if not years. What we have learned from history, however, is every market downturn has always been followed by a recovery.

I will continue to analyze the market and keeping my clients up to date on all its twists and turns, but for now I am providing my most recent analysis. Although it seems such a long time ago, 2019 real estate activity continued to improve in Steamboat Springs. But how did Steamboat compare to other top-tier western ski resorts? Here’s an interesting look at that question, with very informative and surprising results.

The Resorts

Ten resort areas, which include Steamboat, Aspen/Snowmass, Vail/Beaver Creek, Summit County, CO (Breckenridge/Keystone/Copper Mtn), Summit County, UT (Park City/Deer Valley/Canyons), Telluride, Crested Butte, Big Sky, Jackson Hole and North Lake Tahoe (Lake Tahoe, Alpine Meadows, Squaw Valley, Northstar) were selected due to market similarities and historic data availability. One quick note about Park City’s data - it encompasses their entire MLS, which includes Summit and Wasatch Counties.

Average Price

Photo Credit: Doug Labor

At an Average Residential Sales Price of $792,524, Steamboat was the most affordable resort to buy property of the ten resorts in 2019. That increase was still a 10% improvement over 2018. Crested Butte, which jumped ahead of Steamboat, had the largest year-over-year increase at 26%. The average price for a residential property in Aspen fetched $4.345m, topping all other resorts. Telluride had the second greatest YOY gain, at 21% and posting an average price of $1.840m.

Dollar-per-Square Foot

Photo Credit: Doug Labor

The benchmark many real estate professionals use to value property is dollar-per-square foot cost. This is a common denominator for property value and gives what a square foot would cost, no matter if the property is 1,000 square feet or 5,000 square feet, whether it is in Jacksonville or Jackson Hole. In 2019 the Average $/sf cost in Steamboat was $371, giving a 3,000sf house value of around $1.113 million. Aspen posted sales at $1,531/sf for the top spot with Telluride and Jackson Hole tying for second at $800/sf.

Days-on-Market

Photo Credit: Doug Labor

The time it takes a home to sell is an indication of market demand. It takes more days to sell a property in a market long in listings (supply) but short in buyers (demand), than one with fewer listings and more buyers. In 2019, it took only 60 days to sell a home in Breckenridge (highest demand), yet it took 320 for a home to sell in Telluride (lowest demand). Steamboat fared well in this category, with the third least amount of time for a property to sell (102 days). Park City was slightly better at 100 days.

A Comparative Analysis

After looking at these results, one must wonder which market performed the best in 2019? To answer this question, I compiled the past six years of market data from all 10 resorts in against their individual six-year average in six categories of residential sales. These categories are, in order of importance: Average Dollar-per-Square Foot (10), Days on Market (8), Average Sales Price (6), Annual Transactions (4), Sales:List Price Percentage (2), and Dollar Volume (1). Because these categories are more meaningful than others, they have ‘weighted values’. For instance, Dollar-per-Square Foot (i.e. are values increasing or decreasing?) is more telling of market health than mere Dollar Volume. Therefore, each category is given a weighted value (in parenthesis above). The weighted value will then be multiplied by the position the resort places in each category. First place receives 10 points, second place 9, and so on, with the last place resort will have a “1” place score, then multiplied by the weighted value for each category. Resorts will then be ranked based upon their total score.

And the Winner Is…

Photo Credit: Doug Labor

With a potential of 310 total points, Montana’s Big Sky Resort outscored the competition with a total point value of 245, closely followed by Breckenridge (243) and Crested Butte (241). Steamboat took 6th place with 151.

What impaired Steamboat was its 8th place finish for $/SF. Although many Steamboat buyers feel square footage values are high, 2019 was only at 110% of its 6-year average, whereas values at Crested Butte (#1) and Summit County, CO (#2) jumped 131% and 130%, respectively. Steamboat took 3rd place in Sold:List Price %, where our six-year average was 96%; second only to Summit County, CO’s 97%. Steamboat placed in the middle on the other four categories. Finishing in the middle is not a bad thing. It shows most rudiments are in check. At year-end 2019, Steamboat remained one of the most affordable top-tier ski resort real estate markets in the Rocky Mountains, where all markets have enjoyed steady growth since the 2008 recession. However, as mentioned at the beginning, COVID-19 will most likely effect resorts differently. It will be interesting to conduct this same analysis a year from now to see what has changed.

The post Doug Labor On The State Of Top-Tier Western Ski Resorts appeared first on Haute Residence by Haute Living.

The new course the Steamboat Springs real estate market set in 2018 did not alter more than a few degrees in 2019.

The number of transactions (trades) posted by the Steamboat Springs Multiple Listing Service dropped 2% from 2018, at 1,242. This is most likely due to the low supply of properties for sale in the market over the past three years.

Speaking of low supply, listings declined for the ninth straight year, to 1,083. Except for 2006 (1,065), 2019 carried the second-lowest number of listings throughout the year, calling it a tie with 2007 at 1,081.

Photo Credit: Steamboat Sotheby’s International Realty

Another key indicator is Absorption Rate, or the inventory bought, which is the dynamic between supply (listings) and demand (transactions). The graph below shows the relationship between the Absorption Rate (red line) and Average Price (green line). After nine straight years of there being a higher supply than demand (less than 100%), the last three years the market has seen more demand than supply (over 100%) and has averaged around 119%. With supply not meeting demand, one would expect prices to increase, which is seen by the sharp increase in Average Price from $522,000 to nearly $651,000 in 2019. From 1995 to 2019, the Average Price for properties in the Steamboat Springs MLS has increased an average of 9.17% annually. The 2019 Average Price of $650,780 is the highest the MLS has ever recorded. Likewise, the 2019 Median Price was $419,000, also the highest on record.

Photo Credit: Steamboat Sotheby’s International Realty

Although there were not as many 2019 transactions as 2018, there were some very interesting ones. Following are some of the most notable sales and occurrences this past year in the Steamboat Springs MLS:

Single Family Residences

Single-family homes typically represent about one-third of all MLS transactions. 367 single-family homes were sold in 2019 at a median price of $665,000 and $299/square foot. Dollar-per-square-foot is an industry benchmark that equates to a price a property is valued, depending on its square footage. SFR’s within Steamboat had posted 169 transactions (-10%) with a $850,000 median price (+11%) at $362/sf.

The highest-priced single-family home (non-Farm & Ranch) was a 7,555 sf, 6-bedroom (BR), 7 bath (ba) home on 3.48 acres (ac) in the center of town that sold for $5.625 million, or $745/sf. It was only on the market for 267 days. The least expensive home that sold was a quaint, 2BR/2BA, 1,320 sf home downtown on a .15-acre lot and sold at its list price at $402,500.

The Motherwell Ranch, located south of Hayden, captured the award for the highest ranch sale. The ranch consists of 10,349 acres, stunning scenery, river, lakes, excellent wildlife habitat, and numerous improvements. Listed at $33.5 million, it sold for $27 million.

Condominiums

Condos accounted for nearly half of all residential sales in Steamboat Springs (49%). 334 sales (+11%) occurred with a median price of $391,000 (+7%).
One Steamboat Place was home to the highest-priced condo sale, at $3.6 million. The 3,217sf residence was sold at $1,102/sf. This slopeside, 4br / 3.5ba residence comes with yearly HOA dues of $49,706, but some of the finest services and amenities one could want. Fish Creek Condos had the least expensive condo sale at $152,000 for a 1br/1ba, 680sf ground floor unit.

Town Homes

Townhomes fill the niche between condos and single-family homes, with 152 (-4%) selling in 2019. Steamboat $/sf values increased substantially from $310 to $351 (+11%), and median prices increased 7% to $642,000.

Winning the top townhome honor was Chapelco Lodge - a 6br / 4.5ba, 5,573 sf home at $2,350,000. It also features five ensuite bedrooms, a gourmet kitchen, custom metalwork, and a large bunk room. A 2br/2ba Whistler Village townhome in the Mountain Area was the most affordable townhome sale, at $237,500 and 920 sf.

Land

Land transactions saw another decline in 2019. Overall land transactions in 2018 were at 209, and 2019 saw 148. This 61-sale drop was mainly felt in Steamboat, where sales went from 74 to 28. Despite the drop in activity, the Median Price increased substantially from $327,500 in 2018 to $430,000 (31%) in 2019.

The most expensive lot sale in town as a .62-acre parcel in the Boulder Ridge Subdivision. Perched just above downtown with stunning panoramic views of the entire Yampa Valley, the parcel was only on the market for 19 days and had competing offers.

Summary

The issues facing the market a year ago remain the same. Low inventory and high demand are choking the market, increasing values and pricing buyers out of the market. Building costs continue to be high and skilled tradesmen are hard to find. There are some projects on the drawing board, but they are years out for delivery. Look for condo prices to increase more than other property types.

Future Forecast

Although 2020 is an election year, politics have had little impact on markets like Steamboat Springs, so don’t expect the market to change course over the next year. In the near term, look for real estate transactions to drop again in 2020 between 1% and 3%. Transactions will be stymied because of low inventory, which should hover around 1,050. Look for property values to continue to increase another 8% to 10% due to these conditions.

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