Property deals in Pitkin County topped the $15 billion mark last decade, which closed out with three consecutive years of at least $1.8 billion in total sales volume, according to public real estate data.
Last November and December combined for more than $480 million in total Pitkin County real estate sales, ending a decade that saw the value of property transactions continue to rise against a background of a finite supply of residential listings on the market.
“We only have a limited amount of square footage here,” said Steven Shane of the Aspen office of New York-based Compass real estate. “In South Florida, someone could develop a new golf course 2 miles away from an old golf course. It’s not that way in Aspen; we only have X amount of developable square feet. For the most part it’s all been developed.”
The average price of a single-family house in Aspen was $7.4 million through October, compared to $6.9 million for the first 10 months of 2018, according to data from Land Title Guarantee. Through October, single-family home sales in Snowmass Village averaged $5 million, up 47% from the previous year, and came on the heels of the expansion of Base Village with the December 2018 opening of the new Limelight Hotel and other properties.
Both commercial and residential development were impacted by Aspen City Council legislation, as well as a citizens’ referendum, in the 2010s.
Last decade saw the City Council in 2012 ban the construction of penthouses and condominiums in the downtown core, helping drive up the values of downtown residential real estate. Additionally, a referendum passed in 2015 stripped the City Council’s ability to grant variances on height, mass, parking and affordable housing without a public vote. Following that was the council’s passage of Ordinance 7 in 2016, which put a one-year prohibition on filing of land-use applications in the city’s commercial, service-commercial-industrial, neighborhood commercial and mixed-zone districts. The building freeze did not affect residential and lodging districts.
The moratorium was implemented to allow the council to make broad changes to the land-use code and align it with the Aspen Area Community Plan, which reflects residents’ vision of town ranging from transportation to lifestyle to development.
That meant the local real estate and development industry had to adjust to the new regulations, while the overall sales volume peaked at $2 billion in 2015.
Along with developments within Pitkin County, there also were major shifts nationally and globally with changes to political regimes and market forces.
The uncertainties of national politics can impact the local residential market, noted Aspen broker Brittainie Rockhill of Douglas Elliman Real Estate.
Pitkin County residential sales hovered at the $1 billion mark in the U.S. presidential election years of 2008, 2012 and 2016, but during the past three years that figure was in the $1.4 billion to $1.5 billion level, she noted.
“The past three election cycles show mixed outcomes in the dollar volume of real estate activity on election years,” Rockhill said in an email. “Short of predicting what inheritance tax changes may take place post-election in 2020, my advice is that if you have the funds to get in the market and stay for five or more years and your life will be better for it, do it.”
Shane and Rockhill noted that newer residential properties favor sellers in the current market, while buyers see benefits in acquiring older homes listed.
“If buyers are willing to take on remodeling projects, there is more inventory on the market that would fall in their favor,” Rockhill said. “The limited turnkey new product is more of a seller’s market.”
Krista Klees, president of the Aspen Board of Realtors and an executive vice president with Slifer Smith & Frampton, said this year’s “indicators show a slight buyer’s advantage; however, the scale is not tipped significantly one way or the other so far in 2020.”
Klees noted that Pitkin County saw more than 150 residential transactions between $3 million and $10 million in 2019, including record-setting transactions at the Roaring Fork Club and Aspen Glen, for instance.
Like anywhere else, location also is a major factor for buyers.
Homes in both eastern and western Aspen drew strong attention in the higher-end market last year, demonstrated by three sales topping $20 million on the west side, Rockhill noted.
“The market in Pitkin County is nuanced,” Rockhill said. “The strongest market can be portrayed in different ways and statistically skewed by just a few large sales over any period of time. That being said, the largest increase in sales volume activity by area in the last 12 months in the county took place in East Aspen, where sales were up 78 percent. The next largest increase in sales volume was in West Aspen, where there was a 68 percent increase, and where three of the four residential sales over $20M took place. Half of the single-family home inventory in Aspen is priced over $10M, but sales over $10M make up only about a quarter of the single-family homes sales annually. I believe there will be opportunities for buyers interested in this market segment in 2020.”
Shane said Red Mountain remains in high demand. He noted how home prices can see major fluctuations within Pitkin County. A 10,000-square-foot home built in 2016 on Medicine Bow Road, closer to Snowmass Village than it is to Aspen, sold for $13.85 million in December.
“That is a B location,” he said. “If this home was on Red Mountain, the sale price would have been $30 million.”
The city of Aspen also is enriched by real estate sales through a property transfer tax buyers pay at the close of a sale. Collections from the voter-approved real estate transfer tax go toward the city’s affordable-housing and Wheeler Opera House funds.
Through November, the housing portion had generated $7.5 million through the RETT, while the Wheeler portion collected nearly $4 million, according to the city’s most recent tax report issued in December.
Through November, the housing and Wheeler collections were respectively down 8.2% and 7.7%, the report said.