Golf Course News

With the snow slowly melting the local golf courses are gearing up for summer play. The Park City Golf Course along with the private golf courses of Glenwild, Promontory and Tuhaye are all hoping for a mid-May opening. Even though we continue to get snowstorms each week, the days in between the storms are getting progressively warmer and the courses are beginning to green up.

What will be very interesting this year is to see what happens with Promontory. Promontory is a very large golf course community with two championship courses and many homesites. Promontory is going through some financial struggles and trying to work out an amicable situation with its creditors. Earlier this year, Credit Suisse announced that it had taken over the operation of the community and amenities. Since that time Wells Fargo Bank, the second lien-holder has forced the Pivotal Group (which is the developer of the community) to file for chapter 11 bankruptcy which is allowing them to reorganize while still having capital to operate.

Glenwild Golf Course is in the enviable position of having been the first true golf course community built in the area. As a result, Glenwild has 90+% of its properties sold with the golf course and clubhouse seasoned and functioning smoothly.

Tuhaye, one of the newest courses, seems to be doing well, mostly as a result of its affiliation with Deer Valley Ski Resort. Talisker, the underlying developer, has created a unique club concept combining the golf course amenities with a clubhouse and dining facilities on the mountain at Deer Valley. This gives Talisker Club members a true year-round recreation program in ski country. I expect that this unique program will allow Talisker and the Tuhaye Golf Course to remain strong during these difficult times.

There are three new golf course communities underway in the surrounding areas and I will be very interested to see how they do. If we look at how many available lots there are combined in all the communities that are either built or under construction we have about a 30-year supply of inventory. As a result, I do not expect that all the golf communities will survive. As with all real estate purchases, this emphasizes the importance of using a local and knowledgeable real estate agent to guide you in the right direction.

The snow is melting SLOWLY

The snow is finally melting in Park City. Here is a photo taken this morning. You can almost see my front door behind the snowbank.

This photo was taken in January of my backyard:


This photo was taken in February:

And this photo was taken this morning. It will be a while before we're golfing, that's for sure!

Is it a Buyer's Market?

Resort real estate and in particular, western real estate has a history of peaks and valleys. While the ski resorts throughout the Rockies have been somewhat insulated from the traditional urban real estate markets the economic downturn over the last six months has had an effect on us. Fortunately, unlike the real estate market throughout much of the country, we have not seen the drastic drop in prices as we hear about, particularly in places like Florida, Arizona, and California. For the first quarter of this year compared to the first quarter in 2007, we have seen a decrease in the number of sales of about 40% across the board, but only a 3% decrease in average sold price. This is similar to the last big economic downturn in 2000, where we saw the stock market drop 50-60% but real estate values in Park City remained quite stable. During the 2000 downturn, owners who owned property in the resorts saw their investments holding steady instead of losing value in the stock market. We are seeing a very similar trend right now where the market is on a roller coaster of ups and downs and our real estate prices are remaining flat. As in 2000, this kind of a market presents many excellent opportunities for savvy investors.

With properties taking longer to sell than they have in the past, we have more listings available for buyers to see, choose from, and find out which sellers are the most motivated to sell. Because Park City and Deer Valley are very desirable and sought-after, not all sellers are ready to give their properties away. With the expected ups and downs of resort real estate I always advise my owners to purchase with the understanding that real estate markets do fluctuate, and it is important that they be able to weather the slow periods. Unless there is a specific need to sell a property right now, I am advising most of my owners to either hold onto their price and wait out the economy, or just not put their property on the market at this time. Fortunately my clientele is such that the vast majority of my owners fall into this category. However as I mentioned earlier, there are sellers that are not in this position and not all real estate agents are giving this advice to their sellers, so there are some excellent opportunities to be had. As with the stock market, the smartest time to buy real estate is when the market is down rather than waiting for activity to pick up where sellers are less negotiable and there are fewer properties to choose from.

Closing Week

With much fanfare the 2007-2008 ski season came to a close this past weekend. The ski conditions were the best that I have ever seen for closing with over a 10’ base and mid-winter conditions all last week. The weekend finally brought sunshine, warm weather and spring ski conditions on Sunday. Sunday the mountain was crowded with all locals and parties were everywhere. By Sunday afternoon the beach at Silver Lake was rockin’ with many stories being told of this past season. As we now wait for the snow to melt we can take a deep breath and relax with many fond memories of the season. From late December through early February was some of the best skiing imaginable as it snowed most every day. This year people were finally saying that they’d had enough powder skiing for the season.

Big news in real estate this week is that Lewis, Wolcott & Dornbush Real Estate is now a Sotheby’s franchise and our new name is Summit Sotheby’s International Realty. This is very exciting as Sotheby’s brings strong name recognition, and a lot of power to our upper-end market. With the worldwide connections we expect to tap into much more of an international market than we could as an independent brokerage here in Park City. Watch for further information as we make this transition.

Spring Skiing?

While the calendar may say it’s April 1, it feels more like December. After about a foot of new snow over the weekend, we woke up to temperatures near zero this morning which is making for incredible skiing for this time of the year. This year it appears that true spring skiing is still several weeks away. Visitors to town are enjoying uncrowded slopes and perfect ski conditions, very unusual for this time of the year. With only two weeks to go to the end of the ski season here for the local resorts, this past week saw the town alive with spring festivities. We had concerts Thursday, Friday, and Saturday nights on Main Street, and the Canyons held their traditional pond-skimming contest on Saturday. For the pond-skimming competition, the resort digs a large pond out of the snow, lines it with plastic, and fills it with water. The goal then is for skiers to ski down to the pond and maintain enough speed and balance to make it all the way across. This rarely happens. The event is filled with laughter, music, and many very wet skiers in a variety of costumes. If you ever have a chance to see one of these events, make a point of it.

Recently, the IRS has clarified some of its rules regarding 1031 “like-kind” exchanges and the ability of owners to use their property. The IRS has ruled that as long as owners have their property available for rent at market rates, they may use it for up to 14 days per year plus reasonable days for maintenance and upkeep and still qualify as an exchange property. As always, it is important to document usage, stays for maintenance purpose and amount of time the property is rented each year. Check with your accountant or an exchange accommodator for full details on these new rulings.

April 2008

As we wrap up the 2007-2008 ski season, it’s a good time to reflect on the past year. The skiing was the best it has been in many years with what seemed like snow every day from mid-December until February. Long-time visitors to Park City rediscovered our famous powder skiing and first-time visitors discovered what Utah skiing is really all about. It seemed like every other day in January we were saying that it was the best day of the year. All of the snow and all of the publicity brought record numbers of visitors to town. It will be interesting to see the final visitor nights but from what management companies have been telling me, this was their busiest year ever. And from the difficulty that I had showing properties, this was certainly true from my perspective. The ski shop owners are all smiles. Visitors to town were buying new skis, new ski outfits, and of course, everyone needed accessory items like gloves, hats, and goggles. This has certainly been good news to condo owners, store owners, and restaurant owners as news of economic downturns throughout the rest of the country seem to be the headlines every other day.

All of the Park City resorts are scheduled to close April 13, even though we will have around a 10-foot base and incredible skiing. Starting Monday, April 14, not only will the town be quiet from lack of visitors, but the residents will be headed south for warmer climates in an attempt to thaw out their frozen bones. Mid-April through May is definitely the quietest time of the year in Park City. Time for everyone to catch up with old friends, swap stories of the winter, and make summer plans. Quite humorously, I just received the schedule for the Men’s Golf Association and the first tournament is scheduled for April 27. Considering that there is still three feet of snow on the golf course and it is not melting quickly, I don’t see much chance of this occurring. Spring is the time for everyone to recoup, recharge the batteries, and prepare for a busy summer season. Now is the time to make your plans to come out and visit Park City and experience summer in the mountains.