Okay folks, here are some good reasons to buy real estate in Crested Butte in 2011.
1. Crested Butte is popular. Crested Butte has experienced a meteoric rise in what I refer to as “lifestyle popularity”. People around here forget this one, but our market has realized over $1.2 billion worth of real estate investment since the late 2004 acquisition of the ski resort by Tim and Diane Mueller. People visit Crested Butte, quickly realize how cool and unique this place is and many end up investing in our real estate.
2. Prices are down, demand is stable. In the face of the national real estate meltdown, our little ski town market reached around $100 million in sales volume in each of the last two years. Prices are off 30%-60% from our market’s peak in 2006 and buyers are responding to the deals. Our market is certainly not bad for a little mountain community with no stoplights or parking meters and 3500 people in our local population. If anything, $100 million is still a $100 million and it demonstrates to me that saavy home buyers are out there taking advantage of our current good deals.
3. The 800-lb gorilla. The ski resort is now owned by a much bigger entity: CNL Lifestyles and operated by the Muellers. I consider CNL Lifestyles ( a REIT) to be the “800-lb gorilla” in town and crucial support that will guide and bolster Crested Butte Mountain Resort into the future.
4. Our tourist economy has grown more stable and consistent.. The shoulder seasons are not as long as they used to be and folks are visiting during the summer and fall seasons more than ever. The Muellers are doing a great job operating the ski resort (see last newsletter) and the summer season has grown bigger, in terms of overall tourism and economic impacts, than the winter season.
5. Scarcity…in places. In the Town of Crested Butte, considered the cornerstone of the Upper East River Valley real estate market, land is scarce (we are at 95% build out) and homes sell on average for about $400/sft. In December of 2010, an in-town home sold for $568/sft. Values are down from our peak but in-town real estate is certainly not cheap. Look for prices to remain stable in town during 2011. As the Town of Crested Butte reaches build out watch for values to come back around the valley.
6. High end real estate starting to sell again. In the second half of 2010, our market saw the return of the $3 million transaction. Three luxury properties traded at or very near this number in 2010 – this is the first time this has happened since mid-2007. Watch for more of the same in 2011.
7. REO opportunities. Properties that are owned by banks (aka REO or ‘real estate owned’ properties) are where some of the best deals exist. In 2010, banks demonstrated a serious willingness to sell their properties quickly. Of the 168 residential transactions in 2010, 45 deals were REO sales and 10 deals were bank approved short sales. When an REO hits the market, there are multiple offers and buyers are competing for these special deals like it was 2005 all over again.
8. Vacant land and ranch parcels…the best deals. You can score a piece of vacant land or a ranch parcel at pre-Mueller era prices. Land properties including sub ¼ acre home sites and 35 acre ranch parcels are trading at less than 50% of their values from the peak of the market which many consider to be mid-2006. What has caused this segment of the market to go down so dramatically? The lack of traditional financing and huge inventory levels of properties competing for cash buyers. My last count showed we had 310 pieces of land for sale from Almont to Mt. Crested Butte.
Thanks for reading today!
Benson Sotheby’s International Realty
Benson Sotheby’s International Realty | 433 Sixth Street | Crested Butte | CO | 81224