Beat the Market, Buy Land
February 28, 2020
It is no longer a secret that Upper East River Valley residential real estate prices are rising and it is getting expensive to buy a house or condo here. What many don’t know about our local market is the opportunity to buy land including subdivision homesites, larger acreage and ranch land offerings. Today, our market’s best value proposition is unimproved land. Obviously you’ll need to build a house to complete the process but when you receive that certificate of occupancy you’ll likely have an asset with solid equity built in.
Why is purchasing land a great play in the Crested Butte area? Land values have not rebounded like home values. With the exception of the Town of Crested Butte where land values are the highest they’ve even been due to absolute scarcity, the glutted inventory of vacant land elsewhere is keeping values hovering around 60% of their 2005-2006 peak value. Currently, there are 250 active land listings in our local market. 7 parcels are under contract which is normal considering the time of year. It can be a challenge to buy something you can’t see buried under snow! In 2019, 85 homesites sold off so we are sitting at about a 3 year supply of land inventory at this current absorption rate.
Buying a homesite and building a new home is the best way to beat the current market in Crested Butte. Residential sale prices and sold prices per square foot ($P/SF) are soaring across the marketplace. Now, the vast majority of home transactions occur above replacement cost and in some cases well above what it would take to buy land and build. In CB South the top of the single family market is now $400/SF. In Mt Crested Butte homes are selling as high as $675/SF and in the Town of Crested Butte five recently sold homes blew right past the $1,000/SF threshold. At Skyland a spec home sold recently for $660/SF. This is an all time record for a home on the golf course.
