Park City Real Estate Market Update for End-of-Year 2013

Posted by Sean Matyja on Thursday, January 23rd, 2014 at 9:19am.

How is the "The Market"? Well, that depends on which market you're talking about. 2013 was an incredible year for our long awaited real estate recovery. Below we take a look at what happened, and where the market is hot, and where it is not. For example, Park City's Old Town seems to be on fire, while Lower Deer Valley is still in decline.

 

Park City Real Estate Demand - Pending Sales

We love to look at the trends of pending sales, as it is a great indicator of what the buyers appetite is, and it's amazing to see the seasonality of our ski town market of Park City and Deer Valley. Looking at the chart above (Thanks to Rick Klein at Wells Fargo for these great charts!), you can easily see the trends of buying over the years. Starting from the height of 2005 the demand dropped dramatically down to 2009 where we were just barely seeing a few sales for each quarter. Since then there has been a steady ramping up, year over year, with 2013 ending out as the best year we have had in the last five years. One thing we do see each year is a consistent slow down in the 4th quarter of every year. Probably due to the holidays, as people tend to get very busy and focus attention on other things. Also, the 4th quarter is the slowest time of year for visitors to Park City. We are primarily a ski resort town, and the resorts are closed in October to mid November. We finally get skiers back in town in December, but the real crowds don't usually come back until January.

 

Park City Real Estate Demand - Closed Sales

WOW! Just look at the numbers for closed sales for real estate in the greater Park City community. The above chart shows the numbers for the "greater" Park City area. It's important to note that for the entire Park City MLS we saw a total of 2,230 sales of real property. That amount was up by about 20% from the 1,814 total sales in in 2012, and was double the lowest point of 1,130 sales we had in 2009. When just focusing on the the greater Park City communities we see a similar trend in that 2013 was the 4th year of increased sales. We are still not yet at the levels we saw in 2005 - 2007, and it's doubtful if we'll see that level of activity again. The total unit sales in greater Park City for 2013 was about double what we saw back in 2009, which was our low point of the market in terms of unit sales. With the low inventory we are now experiencing, it will be interesting to see how 2014's unit sales play out. We may see a dip in the amount of property selling, as we simply do not have enough properties on the market to satisfy the demands of the buyer pool.

 

Park City Real Estate Supply - Declining Inventory

Currently in Park City, we are seeing the lowest inventory levels since we have tracked this statistic in the Park City MLS. Looking back at the high point of 2009, we had about 2,250 listings. Right now we are at only 1,163 listings - about half. That is extremely low. What we see in the market daily, is if a good property does come up for sale, and is priced fairly close to recent comps, it sells quickly, sometimes in just a few days. Because of the increase in unit sales, and the low inventory, many sellers are getting a little over confident and are pricing too high. These high priced homes tend to sit on the market for a long time. The low inventory appears to have affected the drop in sales for the 4th quarter of 2013. We know first hand, that if there were more good options for the buyers out there shopping, more sales could have occurred. We have many buyers who are watching and waiting for the right property to come up.

 

Park City Real Estate - Declining Distressed Sales

Where is that shadow inventory we kept hearing about? We have seen little signs of a shadow inventory and at this point we really do not expect to see it. The Notice of Defaults are way down as well, indicating that we will not see much increase in Short Sales or Bank Owned properties on the market. The few remaining bank owned properties have not been very exciting and for buyers out looking for that killer buy, your just a little too late. In the 4th quarter of 2011 distressed properties made up about only 6% of the listing inventory, but acconted for about 30% of the sales. In 2013 we only had about 1.85% of distressed inventory and only 3.41% of distressed sales. The good news is the lack of these low priced properties is good for the market's recovery. Without these types of property pulling numbers down, we are able to finally move back up in pricing.

 

Park City Real Estate Pricing - Improving Median Prices

Median prices for the entire MLS of Park City have been fairly flat. When looking at the greater Park City communities, we do see a second year of improvement at a steady, yet conservative pace. Looking at median price for such a large area is not how we typically recommend measuring real estate markets. Even the small market of greater Park City needs to be broken down and analyzed as micro-markets to truly see what is going on. If you are curious about the trends in the ski-in, ski-out homes of Deer Valley, you surely will not want any info mixed in from the very different market of homes in Jeremy Ranch.

By the way, if you are using Zillow to track real estate prices, just remember that Utah is one of seven states that is a non-disclosure state. That means that sold prices for real estate are not public record. Our Park City Multiple Listing Service does not share sold data to Zillow. Therefore, Zillow has no way of knowing or tracking our real estate market. For their z-estimates, they can only access the Utah public records for assessed values, whch are not quite accurate to actual sold prices for proeprty. So, completely disregard their z-estimates as they are entirely worthless for Utah. If you do want sold data, just ask us and we'll pull it up for you direct from our Park City MLS database.

 

Highlights of Specific Markets in Park City Utah

Old Town is the absolute star of the Park City real estate market right now. Some markets are hot, but Old Town just seems to be on fire. For condos there was 157 sales in 2013, that is up by 45% from 108 sales in 2012! The average price was up by 11% at $523,440 and the median price was up by 17% at $380,000. For inventory, we have a decrease of 39%. For single family homes in Old Town we see the same increase of 45% in unit sales! Old Town had 47 sales in 2012, and 68 in 2013 - that is nearly 1 home sold every five days in 2013 just for little Old Town! The median price is now up by 14% at $912,500 and the average price is up from $954,074 to $1,318,683, that is an icrease of a huge 38%. The inventory of homes is way down by about 41%. We only have about 27 homes on the market.

In contrast is the market for Lower Deer Valley (this may be the location to find some killer buys). For homes in Lower Deer Valley, the unit sales are up by 50% which is great. The area saw 14 sales in 2012 and 21 in 2013. The problem is this is one of the only communities that went down in price. The average selling price was down by 13% to $1,533,764 and the median selling price was down by 21% at $1,519,050. The condo sales in Lower Deer Valley were down slightly by 9%, and the prices were fairly flat from the previous year.

The ski-in / ski-out condo market in Empire Pass saw a sizeable decrease of 27% in unit sales, and experienced an increase of about 9% in both median and average prices. The average price is up to $3,046,432 and the median is up to $3,079,250. The reason for the slowdown is Empire Pass is quite simple. After the downturn in real estate, there was abundance of distressed sales and killer buys in Empire Pass. Those distressed properties have been cleared out, and the pricing has been quicky recovering. With the new prices coming back up, buyers are not finding the deals that were previously abundant. Another case of just being a bit late to the game. There are still good values in Empire Pass, and the properties are wonderful, certainly worth the money being paid in today's market. In fact, it's because these properties were so nicely done that we have been lucky to see a strong recovery in this market segment.

For other communities, Upper Deer Valley homes are up by about 30% in pricing. Prospector is up by 19% in average selling price. Sun Peak homes are up by about 11% in median price. Silver Springs is up by 12% in median selling price. Jeremy Rach was very active in 2013 with an increase from 58 sales in 2012 to 73 sales in 2013, an increase of 26%. The prices of sold homes were up by about 10%. Why is Jeremy Ranch so popular? We are seeing many people moving from out-of-state who will work in Salt Lake City but want to live in Park City, so Jeremy Ranch is a great fit for them. Also, with the poor air quality in Salt Lake City, that is driving more people to make the move up from the valley to Park City's clean air and sunny blue skies.

 

Park City Real Estate Market Summary

In summary, things are moving along quite well, and we are amidst a recovering market that hopefully stays on track. Unit sales are bound to start to slow down in 2014 but that is not neccesarily a bad thing. It might be healthy for the real estate values, and may keep pricing in check. It might be better for all of us if the rise in prices slows, and the frenzy dissipates.

If you are curious about selling or buying real estate in Park City, you cannot trust the many online sources (except us!) as many are not dealing with accurate data, or are simplifying overall market conditions. BTW - The Case-Schiller index has almost nothing to do with Park City, it does not even include Salt Lake City or any Utah data. To know what is going on in the Park City or Deer Valley real estate world, you must get the latest info for the specific area of interest. That's where we come in. Just let us know what micro-markets of Park City you are wanting to buy or sell in and we'll get you the important data, and discuss with you the actual comps to better help you. The more educated you are, the better you can make important decisions when the time comes. The fact is Park City is an amazing place to call home. For those of us lucky enough to live here, that is one fact that remains the same, year after year.

As always give us a call or email. We're always happy to be of help!

Sean Matyja - Realtor® / Associate Broker
Mobile: (435) 901-2158 | Email: sean@enjoyparkcity.com 

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