First quarter statistics show a further weakening of the real estate market in Steamboat Springs and other western Rocky Mountain resorts, but real estate professionals say they are beginning to see signs of recovery.
According to data compiled by the Rocky Mountain Resort Alliance, Steamboat's first quarter sales volume was $31.8 million, down from $118 million in the first quarter of 2008 and $190.3 million in the first quarter of 2007.
Other Colorado resort areas showed similar declines. Grand County's first quarter sales volume was $19.7 million, down from $107.3 million in the first quarter of 2008 and $65.1 million in the first quarter of 2007. Vail's first quarter sales volume was $135.4 million, down from $501.8 million in the first quarter of 2008 and $616.2 million in the first quarter of 2007. Summit County's first quarter sales volume was $69.7 million, down from $191.3 million in 2008 and $237.2 million in 2007.
"It's good to see we're on the same boat," Prudential Steamboat Realty principal Pam Vanatta said.
Only 55, or 3 percent, of Steamboat's 1,791 active listings sold in the first quarter, according to the RMRA, and only 20, or 5 percent, of 380 single-family homes listed were sold. Fourteen percent of Steamboat's inventory sold in the first quarter of 2008, and 40 percent sold in the first quarter of 2007.
Of the 11 mountain resort markets profiled by RMRA, none sold more than 8 percent of their listed inventory in the first quarter of 2009.
"I would say volume in most mountain resorts is quite obviously lagging," said David Baldinger Jr., of Steamboat Village Brokers. "In general, what I kind of gauge out of this is a shared experience in the other western resorts."
Although the RMRA statistics are useful in tracking trends, Baldinger said they should be taken with a grain of salt for a number of reasons. He said each market profiled compiles its statistics differently, for example, and he said the percentage of inventory sold is skewed downward by the fact that large luxury projects such as One Steamboat Place and Trailhead Lodge have made numerous presales that are not yet reflected.
"There's some hidden value in Steamboat's market that is significant, but it's under contract," said Baldinger, who said the numbers would be similarly skewed upward when the projects close. "All of a sudden, it will look like the market tripled."
Baldinger also noted that the first quarter is not a good bellwether of the entire year.
"The first quarter, not only in the U.S. but especially in ski resorts, is usually not one-fourth of the volume," he said. "These statistics don't really represent how the rest of the year is going to look. : It's pretty certain that 2009 is not going to be a record volume year. How it compares to '08 : still remains to be seen.
"I would predict our volume is certainly going to be more in the second and third quarters than it was in the first."
Nonetheless, Baldinger and Vanatta each said meaningful recovery is dependent on the restoration of consumer confidence and more meaningful price reductions from the record high property values of recent years.
"Our biggest challenge is getting the buyer's confidence back into buying real estate," Vanatta said. "And we need to get 2007 out of our heads."
Real estate professionals said they are beginning to see signs of both.
"The resorts have been affected by the economy, but they're not dead," said Dennis Hanlon, founder and president of Rocky Mountain Resort Alliance and a Park City, Utah, real estate agent. "Things seem to be improving. Everybody seems to be saying that they're seeing more people coming in."
Hanlon also noted that the stock market and other key economic indicators are showing signs of stabilization.
"I think that's going to start restoring consumer confidence," he said, "and that's really what it's going to take."
The Routt County Clerk and Recorder's Office showed $9.9 million in sales in the week from April 29 to May 6, a significant increase against previous weeks.
Vanatta said showings and contracts are increasing at Prudential and that there have been notable decreases in sales prices. Baldinger said there likely will be more decreases, but he doesn't expect the massive losses in equity and value that have been seen in other parts of the country. Ten to 20 percent reductions from all-time highs, however, are likely, Baldinger said.
"Prices are starting to be adjusted downward, but it doesn't seem like our market is responding like other markets that are under duress," Baldinger said. "We're not in any kind of situation where our values are going to dramatically change, but our prices are going to cool off a little bit, which will bring buyers back."
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