The Aspen, Colorado mansion market has experienced a decline in year-to-date dollar volume, down by 40% compared to the previous year. However, this does not mean that sale prices will decrease, as inventory remains tight.
According to Tim Estin, a broker with Aspen Snowmass Sotheby’s International Realty, the market has returned to the “normalcy” of the years before the pandemic, characterized by a healthy and active market, but not the explosive growth observed during the urban exodus of 2020-2022.
During the pandemic, the Aspen mansion market saw significant growth as people sought to escape city living. However, this unique activity has subsided due to various factors such as interest rates, geopolitical uncertainty, and upcoming elections.
Jonathan Miller, president and CEO of appraiser Miller Samuel Inc., explains that the activity during the pandemic era was not sustainable, citing the impact of Federal Reserve policy on mortgage rates and financial markets. This has led to declines in housing markets across the United States, including the affluent Aspen market.
Low inventory is a contributing factor to the current state of the market, according to Steven Shane, a broker with Compass Inc. Limited supply and high demand in Aspen result in decreased sales when there is a scarcity of available properties.
This year, the summer selling season in Aspen has seen fewer new listings compared to the previous year, indicating historically low inventory levels. Only 175 listings were available as of June 2023, an increase from the lowest point in 2022 but still significantly lower than the level in June 2019 before the onset of the pandemic.
The average price per square foot of a single-family home in Aspen has skyrocketed to $3,150 as of June, more than three times the figure in 2019. This indicates a 6% increase in average home sale price per square foot between Q2 2022 and Q2 2023. Brokers observe consistent strength in the high-end market, driven by buyers seeking move-in ready and newer houses typically priced above $10 million.
The high-end market in Aspen has also seen a surge in sales of properties valued at more than $20 million. The number of such sales since January has surpassed the figures from previous years, indicating continued demand for luxury properties. Additionally, there are currently fifteen properties listed for more than $30 million, along with several off-market properties. This compares to only four properties listed above $30 million in 2018 and 2019, prior to the pandemic.
Building new homes in Aspen has become more challenging due to the city’s limitation on demolition permits, allowing only six per year. This restriction delays the process of tearing down old houses and constructing new ones, impacting buyers’ ability to realize their vision for a property.
Despite these challenges, the summer selling season in Aspen remains active, with brokers showcasing new properties to potential buyers. The market has recently witnessed significant activity, with 12 properties going under contract in a single weekend. However, brokers do not anticipate prices returning to pre-pandemic levels, expecting some adjustment but not a complete regression.
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