Properties still going up in mountain towns, but economic problems cause impacts
Though the average price of homes from Steamboat to Vail to Summit increased in the summer of 2008, buyers are looking for bargains, and developers are a little skittish.
People who have cash to pay for properties are asking for price reductions in Steamboat Springs — and sellers are agreeing because they’re worried about other buyers’ abilities to secure mortgages.
An Aspen developer planned to build two large hotels with a new chairlift connecting to the mountain, as well as the city’s required affordable housing, but now Byron Koste, the developer’s financial consultant, is saying the company is backing out because it can’t obtain enough financing.
In Vail, reporters from the Vail Daily found some evidence to substantiate rumors that Capmark Financial Group may be forced into foreclosure on the Vail Plaza Hotel, which is a huge hotel near the slopes in the middle of Vail.
Meanwhile, mountain town governments are reducing their budgets, due to projections that this ski season may be slow because of people’s economic concerns. Vail predicts a $3 million loss in revenue (to $51 million) and a 14% decline in transfer taxes from real estate transactions.
Breckenridge has cut two unfilled staff positions and put off patching roads and improving Main Street, as Breckenridge real estate transfer taxes create approximately half of Breckenridge’s revenue. The chamber is seeing a drop of 17-20% in bookings, but the town plans to launch a media campaign to drum up business after Election Day.
Ralf Garrison, a local economic expert who predicts vacationer ebbs and flows based on data, says ski vacationers won’t be booking as usual. However, he says good snow has always played — and continues to play — a more significant role than economics does for those devoted to skiing.
He says that based on historical data, core skiers will continue to come, as will non-skiers looking for a peaceful mountain vacation — he thinks this will offset the decline in visits from less committed skiers. He also believes lowering gas prices will entice closer visitors to come up to the mountains.
Beautiful looking website with some valuable information. I will definitely be an avid reader!
Jesse W.
I would have to agree. The lending opportunities or few these days, when it come to condos and town homes. The biggest step for summit county realtors is to make our Buyers understand this. Great article