Summer is underway in Telluride, as the 4th of July marks the unofficial leap into the season. We’ve seen a lot of early monsoon rains this year, which is a great sign after a dry and windy spring. The San Juan high country is green and popping with wildflowers, creating the perfect backdrop for hiking and biking adventures.
In the real estate world, despite the first decrease in overall dollar volume in recent history, average sales prices are still up 31% in San Miguel County (SMC). Still, it feels like we are on the cusp of a shift in the local market. Obviously, it’s hard to know exactly what that means, but here are the tea leaves we’re reading:
Inventory Continues To Be Low:
Down 50% in Telluride and 20%+ in SMC compared to last year, but this trend seems to be turning toward a slow increase in inventory levels.
List-To-Sold Price Ratio Is Historically High:
98% in SMC and over 97% in Telluride – these numbers really can’t go much higher, so it’s now a question of how long sellers will retain this negotiating “power”.
We have started to see some price reductions on properties where lofty goals are being met with reality, but even when this trend starts to drop, it will take time for buyers to truly have any upper hand in negotiations (keep in mind this is an average statistic and each buyer, seller, and transaction have its own dynamics).
Understand that de-escalation does not equal depreciation. The vast majority of Telluride-area Sellers can be patient in a re-stabilizing market where their property sits on the market for longer than 30 days.
High-End Sales & Prices Per Square Foot Are Still Up:
Sales over $5m are up 19% year-to-year. There have been 7 sales over $10m compared to 4 last year and there are 3 more homes pending over $10m. With 7 properties selling for over $2,500/sf year-to-date, 1 over $3,000/sf, and several more over $3,000/sf under contract – the market is still appreciating and being made almost monthly.
Pay attention to the granular market trends – some neighborhoods have little or no listing inventory, and it’s hard to price properties and understand absorption rates when there isn’t inventory to compare to. Mountain Village remains a tremendous value in relation to Town as it tops out at just over $2,000/sf and Town at over $3,000/sf.
Prices have not peaked in this cycle based on pending sales. It is impossible to know when they might peak, but it’s also very clear there are increasing macroeconomic headwinds (never mind the unsustainable percentage price increases over a long period of time).
The historical and current market statistics and trends are powerful information if you truly understand them and how to apply them. Let this knowledge inform you to make the best decisions possible today. As always, the best time to invest in Telluride is when it is right for you and your family. The memories you create will begin immediately and the Telluride market as a whole has been reliably appreciating over the past 30+ years.
Read on for the full report, and contact me anytime to discuss current market conditions as they pertain to your goals.
Hope to see you in Telluride soon!