Buyers of multimillion-dollar Steamboat homes expect quality, great deals
January 23, 2011
Steamboat Springs — When the new home at 2745 Whitewater Lane sold for $1.95 million cash Wednesday, it said a good deal about the state of the high-end market in Steamboat Springs. The property, overlooking Fish Creek from close range in The Sanctuary, originally was listed for $4 million and saw the asking price reduced to $2.5 million in September.
Listing broker Chris Paoli, of Colorado Group Realty, said last week that his research tells him that distressed properties play less of a role in the high end of the market than the impression a few noteworthy bank-owned sales have created. And he said he thinks the supply is more finite than many think.
"My observation is that there are far more buyers in the $1 million to $3 million market than there are good homes," Paoli said.
He counts 82 listings in his target category.
Conventional wisdom says that many million-dollar-plus homes would take years to absorb in this market. But Paoli said it's not easy to find a home of the quality that buyers are expecting in that price range.
"Psychology drives so many of our decisions," Paoli said. "What has occurred is a number of homes have gone into distress, creating a large gap between sales prices and average list prices. Everyone wants the next great deal. Why wouldn't you?"
That leads buyers to wait until the right price similar to the last great deal.
Paoli bases his position on the number of showings his own listings are receiving and a partial survey of local Realtors with qualified, ready-to-buy clients.
"After polling more than 50 brokers in my office, 24 agents responded with 334 active buyers in the $1 million to $3 million single-family home category. Personally, I can quickly come up with 10 more real buyers in this group (from clients of other agents in the market), and there are still another 30 agents to sample. My estimate is there are between 75 and 100 active, very real buyers in this category."
The house on Whitewater Lane might be the most recent great deal in the luxury market. The sale price converts to $341 per square foot for a 5,716-square-foot home with five-plus bedrooms, 5 1/2 bathrooms and a three-car garage on a half-acre. The list price per square foot was $402.
The home has extra touches such as a refrigerated wine room and a dog wash in the garage. It was on the market for 131 days.
The buyer's broker, Pam Vanatta, of Prudential Steamboat Realty, said she agrees with Paoli that prospective buyers in the price range are insisting on the best quality and that before long, the best will be spoken for.
"Demand is getting stronger, and the supply is getting gobbled up," she said. "The question is how long it will take to absorb all 82. I would say you follow the typical absorption rate. It might take five years."
Her buyer for The Sanctuary home previously had looked in the local market, decided to wait and returned to make his purchase.
"I think it was a very good value," she said.
— To reach Tom Ross, call 970-871-4205 or e-mail tross@SteamboatToday.com