The Telluride real estate market is so hot right now. According to the latest available numbers, December 2019 was the largest volume dollar month in San Miguel County history with just under $100 million in total sales.
Bill Fandel, who founded Compass Telluride last year, explained how that number reflects a strong fall season, as there was a “flurry of closings” at the end of the year. That momentum from the fourth quarter of 2019 is continuing into the first quarter of 2020.
“Typically, in this line of work, things take a pause, but it was fairly consistent, so you had fairly dramatic December numbers, and those are giving way to dramatic January numbers,” he said.
Compass is coming off a record year of $88 billion in sales nationally, which makes them the top independent brokerage in the U.S., Fandel explained.
In Telluride, the annual total dollar volume also increased to $594.3 million in 2019, compared to $537.5 million in 2018, a result of the annual average price per square foot increasing — $1,238 per square for a single-family home and $869 for a condo in 2019, compared to $1,105 and $783 in 2018, respectively.
The recent completion of the 23-unit Transfer Telluride mixed-use project on Pacific Avenue resulted in nearly $70 million in closings and contracts throughout 2019’s last quarter, further boosting the December total.
Garrett Simon, partner of Boulder-based Meriwether Companies, said the number of Transfer Telluride closings somewhat surprised him since similar projects in town haven’t always sold as quickly.
“We were aware Telluride is not typically a presale market, meaning contracts before the buildings are complete, we did not expect the absorption so quickly after completion,” he said. “Historically, many projects in Telluride have taken months or even years to finish sellout or obtain the sales that we have within 30 days of completion. That said, we do believe the design of the residences and the project location set up for having great success.”
There’s still a four-bedroom, five-bathroom Transfer home on the market with a listing price of $4.45 million.
The sales weren’t limited to the Town of Telluride either, Fandel explained.
“Over the last six months of 2019, you saw a number of transactions over $6 million in Mountain Village, which has been a notoriously anemic market segment in the previous few years. You saw the market firing on all cylinders across several different market segments,” he said.
So why is the local real estate market so strong right now? Consumer confidence, good timing and supply and demand, Fandel said.
“A year ago, the fourth quarter of 2018, there was a huge movement afoot in the broader macro economy that was predicting a slowdown or recession that never came,” he said. “We saw in this market, once things regained their footing in quarter one and two, the consumer acted with great confidence all across our market.”
The Telluride area, like similar resort towns, typically carries a big price tag, but whereas other places like Jackson Hole or Vail have seen a cooling off of sorts in terms of real estate sales, the Telluride region is having its moment as a place where people want to be, he added.
“I think we offer a lot of relative value compared to places like Aspen and Vail. While it’s expensive here, it’s certainly not as expensive as there,” Fandel said. “Telluride’s a very small supply constrained place. The rigorous and restrictive zoning we have in place invariably pushes up prices.”
The median home values in Aspen and Vail are approximately $1.9 million and $1 million, respectively, while the current medians in Telluride and Mountain Village are $999,000 and $1.15 million, according to real estate website zillow.com.
The sales surge is “reflective of a very strong national economy,” in addition to other factors like supply, Fandel said.
“Sometimes people think it’s all Texans, but it isn’t. It’s New Yorkers and Californians and people from Minnesota and St. Louis,” he said. “Telluride’s a wonderful little place. When they look at other resorts to consider, I think, even though it’s expensive here, it offers that relative value.”
Simon shared a similar sentiment.
“Similar to other resort markets, it seems that buyers want to be in the center of activity, and why Transfer Telluride was so well received versus residences outside of the town,” he said. “Buyers are looking for ease of living while in residence, being able to stay for an extended period of time and not have to use a car.”