Recently, I had a client ask about our amounts of listed inventory for sale in the Park City real estate market. He stated that "I was reading there are well over 3 years of unsold inventory for 2 million plus homes in Park City?" I was not exactly sure on that statistic as actual fact, nor could I quickly or confidently dispute it. Nor should I without having the data to verify the information. So, I took some time to pull up the real data (a.k.a. FACTS) and compiled the information below. This study produced interesting facts, but more so it showed just how misinformed many of our educated real estate buyers are.
I found it quite interesting that he was thinking we had over 3 years of inventory for homes over $2 million, when in reality it was less than 2 years worth of inventory for our entire MLS. If looking at just the area he was interested in, which is Upper Deer Valley (includes Deer Valley's Silver Lake Village) the length of inventory equates to only a 1 year supply! A 1 year supply is a healthy amount of inventory; enough to keep things turning, enough to keep momentum going. It is nowhere near the "well over 3 years " amount, and so off base from what my client had heard elsewhere.
I just love how all of our clients won't ask us for the actual facts on a subject we work in every day of the week. Instead they always try to find some random source and then live by that source as ultimate truth. If you read below, you can see what our entire MLS has listed for sale, and what length of inventory that would be. But real estate is local - nationally, regionally, and even locally within a local market. So if you are interested in say… UpperDeer Valley, looking at overall Greater Park City stats does not make sense, but looking at stats specific to Upper Deer Valley sounds like a great idea. If I come off sounding a little perturbed, I am. We deal with this so often. If our clients would allow us the time to get them the stats that are pertinent to them, life in the world of real estate would be so much easier. But then maybe it would not be called real estate.
So for my market research below I used this client as the example. He was referencing about properties in the Park City area priced at $2 million and above.
Entire Park City MLS:
I started my research of facts by pulling up information on the entire Park City MLS which includes the greater Park City area, Deer Valley and The Canyons ski resort areas. Furthermore it also includes a few properties in Salt Lake City, and also includes outlying areas such as Heber, Sundance, Coalville, Kamas, Wolf Creek Ranch, Morgan, Ogden Valley, etc. For the ENTIRE MLS there are 235 homes and condos listed for sale at $2,000,000 and higher. For the ENTIRE MLS there was a total of 128 homes and condos that were listed at $2,000,000 or higher that have SOLD, or are pending sale in just the last year. WOW, 128 sales in 1 year of properties priced over $2 million, sounds pretty good to me. So if we are selling an average of 10.6 of these homes a month, and we have 235 listed that currently is an inventory supply of 22 months, which is less than 2 years, not well over 3 years.
Now this client was not interested in the entire Park City area, they are looking at ski homes, so I took a closer look at the potential areas of Deer Valley, Park City, and The Canyons. The main areas of town that would have ski vacation homes. I took out all the areas that would not even be of interest to this buyer. I wondered if my stats would be different, narrowing my search field to what was actually of interest to this client.
Narrowed Down to In-Town Areas:
For the "In-Town" areas at and surrounding Deer Valley, Park City and Canyons ski resorts there are a total of 201 homes and condos listed for sale at $2,000,000 or higher. And going 1 year back, 119 homes and condos that were listed at $2,000,000 or higher have SOLD, or are pending sale. So if we are selling an average of 9.9 homes a month, and we have 201 listed that currently is an inventory of only 20 months – less than two years. Narrowing our field to be more suitable to what this client was looking for gave us results showing an even smaller amount of inventory.
Now that last example was Homes and Condos, in all the "In-Town" areas. This client in particular was not interested in any condos, or townhomes. And furthermore they could not look at all of Deer Valley because in Empire Pass Deer Valley the homes are far too expensive and most everything is too clustered together. In Deer Crest Deer Valley they are also too expensive, and the only home near their desired price range is too close to the highway. And in Lower Deer Valley the family decided it was too far from the resort, and nightly rentals are not fully allowed.
So, as with all clients, when you start looking at our entire market, you end up narrowing down to only looking at a particular area or two, in this case we narrowed down to Upper Deer Valley. So I took a closer look at the stats for that area for only Single family Homes, because they did not want to look at Townhomes, or condos.
Narrowed Down to Upper Deer Valley:
In Upper Deer Valley, for Single Family Homes priced at $2,000,000 and above, there are only 16 listed for sale. And in the last year there were 15 Homes that have SOLD or are currently pending sale, so that is about a 1 year inventory. A 1 year inventory! Not "well over three years". A huge difference.
AND furthermore, once we narrowed down to these 16 homes listed for sale in Upper Deer Valley, 7 of them were priced above $5 million, which was much higher than what this client was willing to go up to. And out of the remaining 9 homes, most of those were not up to the level of quality, location, finishes, etc, that they were interested in. So at the end of the day, this client was really looking at a handful of home options to realistically choose from. A handful of homes! Nothing close to the idea that we have well over 3 years worth of $2 million+ homes.
Sean Matyja - Realtor® / Associate Broker
Mobile: (435) 901-2158 | Email: email@example.com