The market for real estate in Summit County may be a disappointment this summer
June 2010 over June 2009 was up more than 79%, so it wouldn’t seem that we would have a poor summer selling season. Year to date we are up 38%. So how would we have a disappointing summer? My interpretation of the market is based on facts, but it also has a little intuition thrown into the mix. That feeling comes from talking to other agents, to clients and potential clients. My intuition and gut feelings for what is happening this summer so far, is what makes me think that we will not have the summer we hoped to have.
The numbers show us to be right on target so far, but my concern is not for the numbers, but for people with properties to sell. 33 of the properties sold so far are some that have been under contract for a year or two, in the large new buildings at the base of Peak Seven in Breckenridge. 26 more are under contract. They have closed at 100% of list price, so those who look at statistics are looking at numbers skewed by these closings. Deduct those out, and in actual fact, the 50% increase we have seen in sales the last two months becomes a 22% increase. The average price of a sold property in Summit County goes from $723,804 to $562,047. Sold price per square foot changes from $299 to $267 and the average amount the Seller negotiates down from list price goes from 5.4% to 6.6%. It just shows how important it is to have all the facts before looking at the statistics and judging how our market is doing.
One way I keep track of how the sales are doing is to look at how many have gone under contract in the last month, as closings usually occur four to six weeks after a contract is accepted. Properties that went under contract in June will probably close in July. As of today, July 2, 2010, 66 properties are pending that went under contract on June 1 or later. In order to match what we had this time last year, we need 79 sales this year, and to have a 30% increase we need just over 100 sales. Unless a good number of the 26 One Ski Hill Place condos close, we may have trouble increasing as much as we should to continue the upward trend. It is possible that a few contracts where there is a cash buyer might be able to close before the end of the month, but they probably wont’ be enough to make that much of a difference.
We did not see the activity in June that we thought we should have, and if talk of the economy not rebounding as quickly as expected continues, it could dampen people’s enthusiasm to buy a second home. Sellers who are aware of the true statistics will continue to be realistic in pricing and may agree to further price reductions, but those who look at the big picture without knowing the facts may think we are doing ok. The good news for Buyers is that there is a lot on the market, and if an offer is not responded to positively, you can move on to another one that perhaps, has a more motivated Seller. Additionally, interest rates are now below 5% and loans are a little easier to get. This is a Buyer’s market!
