The real estate winds are shifting
By Mike Russo
Real estate figures released by Land Title for the first quarter of 2008 in Pitkin County show that we are experiencing a new trend in the Aspen/Snowmass market. Transactions through the first quarter were down 33 percent from last year and sales volume was down 52 percent.
Given that volume has seen a greater decline than transactions, we conclude that current purchases are at a lower aver­age sales price than last year.
The average purchase price in Pitkin County for the first quarter of 2007 was $2.44 million versus $1.73 million for the first quarter of 2008. Compare that to the first quarter of 2006 when the average pur­chase price in Pitkin County was $926,505. Also worth noting is that during the record sales year of 2006, the market experienced five times the amount of closed transactions in the fractional con­dominium market. During the first quarter of 2006, fractional sales accounted for 16 percent of the total volume versus a paltry 3 percent in the first quarter of 2007.
Although sales volume is off, compared to a record first quarter of 2007, it is off to a lesser degree compared to 2005 and 2006. The volume difference is -17 percent and -23 percent, respectively.
The blaze of sales volume that occurred in the first quarter of 2007 represented 30 percent of the sales volume reported for the entire year. Going back to 2003, the average percentage of yearly sales volume has been 19 percent in the first quarter.
Although the year did not finish like a lion, 2007 was still the second best year on record, finishing the year at $2.5 billion, about 4.5 percent less than 2006.
So what does it all mean? The real estate market in our valley is still vibrant and not in the dire straits that some observers suggest. We are still seeing a large number of consumers looking to purchase property in the Aspen/Snowmass market.
The challenge in the marketplace today is the disparity between buyers and sell­ers. With news of the threatening reces­sion, a credit crisis that remains tenuous at best, followed by a national housing crisis and inflationary fears, among other con­cerns, the Aspen valley market continues to hold its ground in pricing.
A recent seller of a home in Wildcat Ridge exemplified the Aspen real estate market when he was quoted nearly two years ago in the Wall Street Journal as say­ing,“ If we don’t get the right price, we won’t sell.”
So how has the wind shifted? Of the 207 consumers that chose to purchase in Pitkin County this year, they decided they still wanted a property in our county, but on average decided to spend less than the buyers of last year.
(Michael S. Russo is president of Aspen Sotheby’s International Realty He can be reached at mike.russo@sothebysrealty.com.)

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