Winter is on its way
I took the photo above from the top of Buttermilk on October 14th — it was a cool perspective to see the snow guns blowing snow on Golden Horn and Thunderbowl at Aspen Highlands. I took the photo below exactly 24 hours later (yesterday morning)… same view with an entirely different perspective.
The difference a day makes this time of year in Aspen is striking, and frankly, lately it feels that way in the Aspen real estate market as well. It used to be highly unusual for a newly listed property to gain immediate traction in the market, much less receive offers within a day or two of hitting the market; now it’s almost odd if a newly listed property doesn’t receive immediate action and attention (and in many cases multiple offers).
One of the great metrics to follow for Aspen Snowmass real estate trends is the sale-to-list price ratio. That’s a fancy way of saying “what percentage of the list price do properties sell for?”. In the heart of the Great Recession properties were selling on average about 13% off the list price (and keep in mind the list price had often already been reduced 5-20%+ from the original list price).
Today there are several properties selling at or even above the list price and the average discount is about 4% in Aspen and 2.5% in Snowmass Village. In other words, a home listed for $10 million is closing for about $9.6m to $9.75m today (this is on average!), and in 2010 it would have been more like $8.7m (on average). Keep in mind this doesn’t take into account that a $10m home in 2010 is actually worth about $20m today (you heard that right, prices have roughly doubled in Aspen since 2010).
While the difference in buyers’ negotiating power (or lack thereof) in the Aspen Snowmass real estate market is striking, it all relates back to the fundamentals in the local real estate market. Supply (current listing inventory) is historically low right now in most neighborhoods and price points and buyer demand continues to be relatively strong – this drives seller pricing power and the ability for sellers to ask higher prices, and also negotiate less off their asking price.
Take a look at the history of the sale-to-list price ratio for Aspen sales – and keep in mind this represents the entire market average (there’s a huge range today of properties selling at 20%+ discounts all the way to properties selling for 5%+ more than the asking price!)…