Park City Real Estate Market Report

Derrik Carlson's Market Report
Coronavirus Updated 5/21/2020

KEY POINTS:

• From April 22nd to May 19th of 2020 there were six more pending sales (175) than the same timeframe in 2019 (169).
• The Coronavirus stay at home order is now showing in the number of closed sales, which is a lagging indicator.
• The big city life isn't what it used to be and people will be moving, maybe to Park City.

MARKET UPDATE
The Park City real estate market has been affected by the Coronavirus but we are starting to return to normal. If it weren't for people wearing masks, life would feel 95% normal with a typical shoulder season between the ski resorts closing for the seasons and waiting for the muddy trails to dry up. We are in unique times where real estate occupations such as Realtors, builders, inspectors, and title companies were deemed essential and people have continued to buy and sell property in the Park City area. What wasn't deemed essential was keeping the ski resorts open and potential buyers traveling to Park City. Approximately half of the properties in Park City, Utah are second homes - when fifty-percent of buyers are taken away you would expect sales to almost completely dry up within forty-five days. That has not happened and our new under contract numbers for the past four weeks have been right in line with 2019.

As you can see in the charts and data below, by week 13 of the Coronavirus / COVID-19 new under contracts had dropped by forty to sixty percent of what they were in 2019. Now, it feels like everyone has had enough of being locked down and the pending sales for 2020 are falling right back in line where they would be typically.

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A BIT OF MY PERSPECTIVE:
I've been on the phone talking to as many people as possible that were once interested in buying real estate in Park City. What I've come to realize is that the Coronavirus has amplified life goals to help people finally decide to purchase a vacation property, pull up their roots and move here, or go in another direction - there are very few people on the fence. It has been incredible to hear how different this experience has been in different areas of the country. People that live in the populated areas of New York, Califonia, New Jersey, and Illinois areas are anxious to move to a slower and possibly safer way of life. If Park City can catch just a fraction of buyers moving out of these areas I suspect prices will remain strong and possibly even push up for primary residence type properties. It's yet to be seen how luxury real estate will react to the economic slowdown/shutoff. Smaller properties that are used as investment properties could be affected the most if there are issues with the ski resorts opening up to full capacity.

WHERE IS THE MARKET HEADING?
The conversations I've had lead me to believe that there is a strong appetite for Park City properties. In Park City, buyers don't have to buy, sellers don't have to sell, but everyone wants to be here - that's the truth! About half of the properties that have been purchased in Park City over the past decade have been 100% cash transaction so many of our sellers don't have a debt obligation to unload if the economy doesn't bounce back quickly. Many of my clients are small business owners, CEO's, hedge fund managers, or retirees they have strong assets so they won't need to liquidate their property to stay alive - we live in a unique semi-protected bubble here. I think we're going to have to wait this out a bit longer to see how the economy restarts to get a good feeling on the overall feeling of the long term direction of Park City real estate values.

PARK CITY REAL ESTATE DATA DURING CORONAVIRUS:
Below are charts and graphs that compare the same timelines of 2019 to COVID-19 2020. When the stock market was falling there were real estate "experts" telling real estate agents to buckle down for a big downturn and slowdown of the real estate market in America - now they are saying to get ready for a mini-boom with buyers ready to make huge changes in their life. The past four weeks of pending sales are telling on how people feel about Park City real estate. Let's get into the data of the Park City Real Estate Market Report.