President's Weekend in Park City

Snowing hard, blowing hard...it must be President's Weekend! I’ve just seen more often than not that President's Weekend is very snowy, and this one is no exception. We got about 25” of snow from Saturday morning to Sunday morning. Which of course made for incredible skiing. I was out on Sunday which was as usual a sellout day at Deer Valley and everyone had big smiles. The powder was soft and deep and the groomed was perfect soft-packed powder. Just from watching everybody and talking to people on the lifts they will be talking about this weekend for many moons.

At the end of January, I attended the WMRA annual meeting in Vail, Colorado. These meetings give me an opportunity to meet with fellow resort realtors and discuss with them how their market is faring in today’s economy. The overall consensus was that everyone’s market had improved considerably starting sometime during the 3^rd quarter of 2010.

During the weekend’s meetings, we were fortunate to listen to a presentation from a real estate consulting and appraisal group out of Denver, Colorado. This group has been hired as a consultant for many different projects throughout all of the western resorts. The presentation that they gave was extremely positive and enlightening and quite encouraging. Looking at resort numbers from 2007-2010, a trend became quite obvious. 2007 (and for some areas 2006) was definitely the high part of the market with 2009 the low point. Pretty much every resort showed the same trend: high dollar volume and high number of sales in 2007, trending downward in 2008, bottoming out in 2009, and starting to recover in 2010.

Two other interesting statistics came out during this presentation which I also found very relevant. First was the number of active listings per single family home and condos for each of the Western resorts showed a sharp decline from 2009 through 2010. The second was that the average sales price for homes and condos was at the peak in 2007, declined through 2008 and continued to decline through 2009, then remained relatively flat in 2010. Anyone familiar with economics would find this interesting in that if the number of sales are on the increase while inventory is decreasing. Logic would state that prices should also be on the increase. More demand, less supply, causes higher prices. I believe that we still have enough downward pressure on prices from bank foreclosures and short sales that we will not see prices increasing quite yet. However if the trend of increasing demand and decreasing inventory continues, prices will have to follow.

Click here to view the presentation. (It's a rather large file, so please be patient. It's an excellent read!)

There was another section of this presentation regarding resort hotel occupancy, but I’ll save that for next week. In the meantime, come out to Park City and enjoy the incredible winter we’re having; the skiing is fabulous!

I'm Back!

After some time off from my regular blog I am back and will be blogging on Park City, what's happening in Park City and real estate on a weekly basis again.

First, let's talk about what's been happening in Park City this winter. It's been a very busy winter, first with very early snow beginning in November, and heavy and regular snowstorms right through Christmas. This gave ski resorts one of the best openings that we've seen in many years and great skiing for the Christmas holiday.

January was unusually dry but no one seemed to mind skiing with sunny, bright blue sky conditions. The Sundance Film Festival came at the end of January and from all accounts Sundance visitors were once again spending. Restaurants and Main Street shops all reported that their business was up significantly over 2010's Sundance Film Festival.

Earlier this month, Deer Valley and Park City hosted the Freestyle World Championships. A fabulous weekend starting with the Parade of Athletes down Main Street and three days of competition ending with the dual mogul event under the lights of Deer Valley. As is typical for Park City (which is ready to party at the drop of a hat) the whole town turned out for the events, particularly the mogul event Saturday night. One of the great things about living in a world-class resort town like Park City is the opportunity to see the best athletes in the world competing in international events. Throughout the remainder of
the winter there will be many more competitions here in town: skiing, snowboarding, bobsled, luge and jumping events taking place now through spring.

Onto the world of real estate. 2010 saw a return to better times. While prices are still low and have not yet begun to rise, the number of sales in 2010 was up about 30% over the number of sales in 2009. This increase occurred mostly in the second half of the year and particularly from early fall through Christmas. What we observed was a change in buyers' thinking. In 2009, the prevailing thought was "if I see something I like, it will still be here when I come back (and probably at a better price)." In the last half of 2010 the thought process changed to "if I see something I like and it's priced correctly, I need to put in an offer now because it will not be here when I come back." Buyers seem to be saying that they feel we are either at the bottom of the market or so close to it that they do not want to miss out on this opportunity.

From my observations and in talking with other agents in Park City, this same sentiment is holding true for the first 5 weeks of the new year. Another interesting aspect we're seeing is the number of active listings available to purchase has decreased significantly from 2009. Conventional thinking would tell us that when demand increases and product availability is decreasing, prices are soon to rise. However, I think we still have enough downward pressure on prices from distressed sales that this may not happen for a while yet. On the other hand, we are beginning to see multiple offers on some select properties. It will be very interesting to see just where this ski season ends up with sales numbers and prices. Check back frequently for more updates on this.

But for now, come out and ski! The skiing is terrific and we are entering the warmer months.