Telluride’s Real Estate Market

Good Day Readers,

Interesting article published in the TELLURIDE WATCH today about Telluride’s real estate market. While we are not as big or as expensive as Telluride, our local Crested Butte market is starting to have similarities to our San Juan Mtn. neighbors. Crested Butte’s prices are rising so our total dollar volume is BIG but the number of transactions is way off from last year. Lets face it, property is appreciating and causing price levels to hit all new heights!

Thanks for visiting today!

Channing Boucher

Real estate sales in San Miguel County have set yet another record for dollar volume through the end of September, even though the number of total sales is down, from 671 to 575 (down about 14 percent), according to figures compiled by Judi Kiernan of Telluride Consulting.

The total dollar volume for sales, through September, was up 3 percent from the same time last year, with an increase from $533.3 million to $548.9 million.

“This is profound because we’ve been setting records for the past few years,” said Buzz Fedorka, a real estate broker for Telluride Real Estate Corporation. “We’ve got pretty high expectations for this coming winter.”

Fedorka pointed to two pieces of evidence to support his optimism: the fact that sales have held up despite a downturn nationally, and the projected spring start of construction of the Rosewood Telluride, a $200 million resort condominium project to be built on Country Club Drive in Mountain Village.

Fedorka said that one key to the summer market’s success was that many prospective buyers did not see any evidence that Telluride is experiencing a slowdown like the ones in big cities.

“We don’t see any evidence that there’s going to be an oversupply of real estate, and therefore we don’t see an oversupply of inventory,” Fedorka said, and added that local real estate brokers have to educate buyers that they’re not experiencing in Telluride what buyers read about in the business pages of the Wall Street Journal or in Barron’s.

The strongest areas of the market, Fedorka said, include houses, condominiums, and vacant land in Telluride and Mountain Village. The out of town mesa land sales, Fedorka said, “have been outstanding.”

Fedorka said the one area where the market appears to be somewhat weak is in the sale of vacant lots in Aldasoro Ranch, which has been hurt by the prohibition of dogs there.

“I believe this no-dog regulation will be removed in the near term, and that may have a very positive [effect] on accelerating sales,” Fedorka said.

He added that the prices of Aldasoro lots look good when compared with the cost of vacant lots in Telluride.

Chris Sommers, also with TREC, said the deed-restricted market has been flat this summer, though it is starting to pick up. He also expects the market to improve in the Mountain Village.

The strongest section of the market, Sommers said, is the Town of Telluride, where he said people want to live so they can be close to the business and cultural centers.

Sommers said that TREC has sold 16 homes in Telluride and Mountain Village, through mid-November, with 65 still listed on the market.

Sommers said that TREC has made 19 total real estate sales in Telluride, and 50 remain on the market.

“In general, the market is very strong, and we expect a record-breaking winter this season,” Sommers concluded.

Michael Ward, a realtor for Peaks Real Estate, said a lot of people are buying real estate now with plans to live in the area later in life. Ward said that owners often consist of families who spend two months in Telluride in the summer and one month in the winter.

Ward’s wife and business partner, Lynn Ward, said success in real estate is all about fair pricing.

“I think that homes that are appropriately priced are going to sell well,” she said. “In the last year or so, homeowners have gotten really speculative in their pricing.”

She added that, while she and Michael do most of their business in Telluride, they are keeping “a close post” in Mountain Village, where she expects homes to continue to be strong.

Michael Ward, who has lived in the Telluride area since 1973 and has been in the real estate business since 1980, added that if the early snow is any sign, it will be a good winter for him and other brokers.

Erik Fallenius, who has owned Telluride’s Nevasca Realty since 1985, agreed that “the Telluride market feels solid,” but noted that, while dollar volume has been about the same as last year, Nevasca has made about 25-30 percent fewer transactions than it had at this point last year.

“What’s interesting is our market has sort of a spotty strength,” Fallenius said. “We’ll see certain transactions that are very substantial, yet there are a lot of properties on the market that continue to languish.”

Fallenius said the large-dollar purchases in the real estate market give brokers a false sense of security.

“In general, as has always been the case, the Telluride real estate market is fragile,” he said.

Kim Havell of TREC said that condominiums are selling well. Havell said, if her recent stay in a hotel in Aspen is any indication, there is reason for optimism about the coming ski season. She said every time it rained during a home Broncos game, people would call the hotel to make reservations.

Havell, the past president of the Telluride Board of Realtors, stressed that the market is cyclical, so certain market sectors, notably mesa properties, she said, are looking substantially stronger than others.

She agreed with other brokers, though, that “overall, the market is quite strong.”

The deed restricted market, she added, continues to do well, with in-town developments such as Mendota and the Meadows properties (like Coyote Court in Mountain Village) gaining popularity.

Havell echoed what other local brokers said.

“Homes in the Town of Telluride have been one of our strongest market sectors over the past six months, along with some strong sales in ranches and mesa properties. Homes in the Mountain Village and condos in town have come down slightly in number volume from their rapid pace of 2005.”