Buyer Interest Remains High
Luxury Hospitality Brands Broaden Buyer’s Market
Park City, Utah – April 22, 2011 – As reported by the Park City Board of REALTORS® Multiple Listing Service, real estate sales in the first quarter of 2011 in the Park City area looks much the same as it did in 2010. As predicted at the beginning of the year, real estate activity in the Park City area continues at about the same pace as what was seen in the latter half of 2009 and throughout 2010, with activity remaining steady and prices remaining low. Well-priced properties continue to see significant buyer competition through multiple offers and foreclosures remain a significant part of the market.
“Current activity levels are helping to reduce overall inventory,” declared Patrick Giblin, President of the Board of Directors for Park City Board of REALTORS. Inventory levels have decreased since last year, with approximately 2,400 properties currently on the market compared to 2,775 for the same time period in 2010 and about 3500 in 2009.
The number of first quarter 2011 sales was up 15% from first quarter 2010, with 374 sales for the period compared to 325 in the first quarter 2010. However, because of the lower prices, sales dollar volume was down at $254,000,000 versus $303,000,000 from the first quarter of the prior year.
Sales of Single-Family Homes
Single family homes continue to be the strongest part of the market and the only segment that reflected an increase in median price. Based on a rolling twelve month average, median prices for the first quarter of 2011 were $515,000 up 3% from the first quarter 2010 at $500,000. These figures reinforce the Park City market as both a destination resort and desirable year-round residential community.
Prices
Median prices appear to have taken a drastic drop in the first quarter of 2011 at $316,500 versus $437,000 for first quarter 2010, but this is seen as a combination of lower prices and what sold in the first quarter rather than a major drop in overall prices. Although downward pressure on prices continues to occur, the large drop can be attributed to increased sales of low-end condos (mostly distressed sales) in the Kimball Junction and Jordanelle areas, increased sales of lots in all areas and increased sales of fractional product, primarily in the Canyons area. A better indicator of pricing is a review of the median prices based on the previous twelve months of sales. When looking at this longer period of time, the median price for all properties dropped from $420,000 at the end of the first quarter 2010 to $375,000 at the end of the first quarter 2011. An even more timely review shows that median prices dropped from $398,000 at the end of the fourth quarter 2010 to that $375,000 figure at the end of the first quarter 2011, about a six percent decline. Giblin added “even with this drop in prices we are seeing this downward price trend reverse in some areas, particularly in the single family properties.”
Foreclosures
Sales of distressed properties continue to be a significant part of our market, with 35% of all sales in the first quarter being either bank owned properties or short sales. This is especially noteworthy because although they make up over a third of all sales, these properties represent only 7% of all properties on the market.
Sales of distressed properties are expected to continue as the number of these properties is sizeable, although important to note the number in pre-foreclosure status is down from 2009 and 2010. These distressed properties will continue to put downward pressure on prices and it appears that foreclosures will continue to influence our market through the year.
Looking Ahead
It still appears that the outlook for the remainder of 2011 is similar to what was seen in 2010. Sales activity is expected to continue at a strong pace, with the number of pending sales in the first quarter 2011 higher than any quarter since the summer of 2007. The high sales volume will continue to reduce inventory of for sale properties which is a pre-cursor to overall market improvements.
Park City is also seeing the benefit of its new luxury brands with Montage, St. Regis and Waldorf Astoria now fully operational and each with a loyal return guest following. These new developments are bringing fresh clientele to Park City that has never been to Utah before. The introduction of Park City into new buyer markets helps expand the prospective buyer base and helps drive demand. REALTORS are now seeing significant buyer interest from new markets such as Texas and Northern California and internationally from Taiwan.
The Park City Board of REALTORS® (PCBR) is a trade association of more than 900 members comprised of REALTORS® and Affiliates from the greater Park City real estate industry. PCBR analyzes and reports on real estate trends for the greater resort community of Park City.
Source: Park City Board of REALTORS®
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