Summit County Bear Market that is. Just a few thoughts on Summit County real estate.
I understand concerns about diving in to any financial commitment at this time. It is hard to know what will happen in our market and in the national arena. Here in Summit, our prices are stable. Some types of property are still going up in price, new construction, and some types of property are going down in price, older single family homes. Single families saw the largest appreciation from 2003 to 2007. Some Sellers are getting more and more motivated to sell as we head into winter, their selling chances decrease until next spring. The big question is if we will start to absorb inventory next spring or will the glut of property remain thru next summer. Either way I don't think you will miss any opportunities this fall.
I am optimistic about the spring. Our market started to slow in August 2007, third quarter. In the past, we have never had a slow period last more than 18 months. May 2, 1982, known as Black Sunday in Rifle Colorado, was the day Exxon pulled out of Colorado, causing the Texas oil bust and Colorado shale oil bust. By 1989, over half the Savings and Loans had failed, along with the FSLIC fund that was created to insure their deposits. After September 11th, 2001, and both of these events, we had an 18 month flat lines with value dips in some niches, as we do now. After 18 months of inactivity, values started to raise at a rate which made up for lost time. Please find the attached PDF file with a graph of values from 1980 thru 2006. I think this spring will finish our 18 month period. I expect Summit County values to start to go up again in the spring of 2009. Although 18 months takes us to Feb. 2009, I don't expect a spike in activity until the snow melts.
Of course, one could say that the 18 month period just started this summer. Bear Sterns, Leman Bros., AIG or the passage of the bail out bill. However, the stock market may just have a few more weeks of volatility at the bottom. My father was a stock broker with Merrill Lynch thru the 70s and 80s. He always said "it's hard to spot the bottom until it's on it way up.' The question remains, will we stay flat thru next summer or will values take off in the spring? My advice is to make a conservative purchase when it feels right for you and your situation, independent of the market. One of the great things about real estate is the individual nature of each property. Your home value is not determined by an index, but by the quality of your purchase and what an individual Buyer will pay. Emotional value carries a lot of weight in Summit County. Even today, "great property" is selling quickly and at a premium. Crystal Peak Lodge, new construction at Peak 8 just closed 50 properties priced between $977 and $2,000 per square foot. Overall Summit County averages $300 to $600 per square. Quite a premium for quality. Thanks for your time. I look forward to helping you or your client find a great property, when the time comes.