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In my last issue I highlighted the impressive buy-up of homesites located in the Town of Crested Butte and the growing trend of investors turning their attention to vacant land properties in other locations around the valley. This trend appears to be gaining momentum particularly for lower end offerings in Crested Butte South and rural neighborhoods including Buckhorn Ranch.
It was only a matter of time before homesites were attractive to investors again. Vacant land values plummeted after the 2008 financial crisis and the market segment has taken a beating ever since with low demand. With the exception of the Town of Crested Butte, land values around the valley have not recovered while values for existing homes have increased sharply and in many cases above their replacement cost. This is why land is selling again.
Ten parcels have sold in Crested Butte South in recent weeks and five more are currently under contract. The average sales price of a CB South lot is hovering around $60,000. This is essentially double what these parcels were worth in 2013 but still well below the 2006 market peak average of $180,000. Closer to town, six homesites sold recently at Buckhorn Ranch at an average of $60,000 each and in Larkspur a .21 acre parcel on the pond just sold for $98,000.
By comparison, eight homesites in the town of Crested Butte have sold off this year, ranging in value from $420,000 to $650,000. Now, the average list price for the ten parcels currently for sale including the Treasury Hill and Journey’s End neighborhoods is $895,000. Interestingly, only three homesites have sold in Mt. Crested Butte this year, ranging from $170,000 for a Gold Link subdivision homesite to $500,000 for a ski in ski out Prospect neighborhood lot.
Sales Taxes Up – Sales tax collections in Crested Butte are spiking so far in 2015. January figures show sales tax was up 17.5 percent. The sharp growth in lodging tax revenues from short-term rentals is a major factor.
The Real Estate Transfer Tax – A 3% land transfer excise tax is imposed on the sale of all real property within the Town limits of Crested Butte. Half of this tax goes to the preservation of open space outside the Town limits of 1991. The other half goes into the Town’s General Capital Fund. Typically but not always, the 3% transfer tax is split between a buyer and a seller at the closing table.
Design Review and BOZAR – Want to build a house in Crested Butte or remodel an existing home? All changes to exterior elements of existing buildings and new structures must be approved through the design review process. As a National Historic District, the Town is sensitive to the appearance, scale and mass of all the structures located in Town. This is particularly true with regard to alterations to historic structures within the Town. The Board of Zoning and Architectural Review (BOZAR) reviews all proposed structures and changes to existing structures for compliance with the guidelines.
For additional Crested Butte real estate market insight, contact me anytime. And, feel free to review my most recent significant sales here.
Thanks for reading today,