As we pass the halfway point of the 2013 Aspen real estate market, the market continues to favor the buyer, although less so than at any point since the market bottomed in 2009. At the end of May, the overall volume of real estate sales in Pitkin County was about $419 million, about 6.2% behind the volume of total sales of $446 million at the same time in 2012. The total number of sales through May of this year was 315 transactions compared to 270 sales at the same time in 2012 indicating more sales but at a lower average price point.
While the real estate market in the rest of the country has experienced a strong rebound from the recession lows, the overall Aspen Snowmass area market seems stuck since 2009 in a total annual volume range of between $1.2 and $1.5 billion. A close look at the Aspen home market shows a similar tight range as well. In 2011, there were 81 home sales with an average price of $6.4 million and a median price of $5.0 million. This was repeated again in 2012 when there were 91 home sales with an average price of $6.5 million and a median price of $4.8 million. This year through July, the market seems poised to repeat the same pattern with roughly 40 home sales, or roughly 80 sales projected through the end of 2013, with the average price slightly down to about $5.2 million and the median price so far this year at about $3.3 million. On the surface, it would seem that nothing exciting is happening in the Aspen home market this year. But under the surface, there are some interesting trends developing. Since the fall of 2010, the median asking price for homes on the market has risen from about $4.8 million to about $6.2 million, a roughly 29% increase. This is most pronounced in the upper tier homes priced over $10.0 million where the median asking price has increased about 40% since fall 2010. Another interesting trend has been the significant decline in inventory. In the fall of 2010, there were about 300 listings of homes on the market for sale in Aspen. Today, that number has dropped to 193 listings. Over the past year, the other notable trend has been the increasing number of days the average home listing is on the market. In the fall of 2012, the average home was listed approximately 175 days before it sold. Currently, the average home is listed about 270 days before it sells. Another indicator of where the Aspen home market is headed is our proprietary Market Action index. The Market Action Index measures available supply relative to the current level of demand and average days on the market for unsold properties. ItaEU(tm)s in essence a collective index of all market factors combined and an early predictor of future market trends. An Index Value above 30 indicates conditions favorable to sellers; whereas a Market Action Index below 30 indicates the market is getting more favorable for buyers. In the fall of 2010, this Index was at an all-time low of about 5 signaling a very strong buyeraEU(tm)s market. Today the Index sets at about 23, still signaling a buyeraEU(tm)s market but moving closer to a more balanced market between buyers and sellers. What does all this mean? The increase in the average listing price and the increase in the number of days a home is listed before sale may be an indication that potential buyers are not seeing the type of homes they want to buy; or the homes that are for sale are priced too high. The lack of attractive inventory at unattractive prices would lead to fewer sales and elongated listing periods. Although the overall market seems to be improving for sellers, these indicators could explain why the 2013 Aspen home real estate market is not setting any records.