MARKET TRENDS

Despite a nationally fluctuating real estate market, Aspen is still on the upswing, continually setting benchmarks and producing record-breaking deals. The most recent trend: residential units selling for prices that break down into more than $2,000 per square foot. Aspen broke the $1,000 per square foot mark six to eight years ago, but these days $2,000 per square foot is becoming common and last autumn saw the sale of a property selling for more than $3,000 per square foot.

There are limited places in the world that the truly wealthy can go and be comfortable living there. Aspen is one of the few. It’s a place where if they find something extraordinary for them here, they’ll take it because you can travel all over the world and not find what’s here.

To start building a new house from scratch today — including land, materials, architecture, permitting and financing — would cost somewhere around $2,000 per square foot, if a luxury home were the goal.

Last year, Aspen first consistently saw homes sell for $1,000 per square foot. In 2005, the average was $859 per square foot, according to the Aspen Board of Realtors. In 2006, that figure jumped to $1,103 and in 2007, to date, it sits at $1,258. Compare that with national averages and Aspen is about 10 times the norm.

If compare to Manhattan, and places where the properties are different, there are not a lot of 10,000-square-foot homes in Manhattan. Everything is vertical and smaller, so you can only compare price per square foot to a certain point. In London, Hong Kong and New York City, price per square foot is double - sometimes triple - what’s happening in Aspen. The Associated Press recently reported London units selling for $6,000 per square foot, and $4,000 in New York.

With a minimal amount of vacant lots still available for development, and new code restrictions on those that can be, there’s more want for fewer commodities. Aspen is a town that’s cute and quaint and first-class amenities, and will stay that way. Looking at trends in other markets — like London and New York — where Aspen may currently be lagging, has historically shown that the upper Roaring Fork Valley isn’t far behind.

It goes in cycles, it will slow back down to a normal pace (at some point), but realtors don’t see anything going in that direction. During cycles in the ’70s and ’80s average home prices tripled and so far during this decade Aspen’s prices are on pace to at least double. There’s no reason for history not to repeat itself.

In Pitkin County, records show February 2007 sales were up 59 percent from the same time period in 2006. The first two months of 2007 saw $445,821,900 worth of sales, compared $236,033,000 during January and February of 2006, according to Land Title Guarantee Company employee data compilation.

Excerpt from “Pricey Feet” on “Aspen Daily News”, written by Christine Benedetti. Read the complete article here.

Real Estate Report

The Aspen Valley real estate market has experienced a dramatic surge in homes sales over the past few years. In 2006, price appreciation was just under 30% and the market hit a record for sales volume at $2.6 billion. While the number of transactions has not been as robust, the sales for the market are on track to surpass the record set last year.

On transaction basis, 2006 was the best year. The majority of the decline in transactions is experienced in the fractional market. Through June of 2006, fractional sales represented 450 closed transactions. Fractionals have had a decline of (71%) in the same period of 2007, bringing the total to 132 transactions. Last year, fractional transactions represented 36% of the market, compared to 19% for 2007. When we look at whole ownership transactions, Pitkin County has been in stride with our best year ever. Through June of 2006, there had been 545 transactions versus 537 in 2007.

Read the complete report (PDF)

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