The $20 million+ Aspen Home Market - Part II
My previous post covered the current state of the $20 million+ single family home market in Aspen, and some of the interesting trends taking place. I think it’s important to have some historical context about a price point that was considered “rare air” in Aspen, and is now the primary driver behind many of the local real estate trends and fundamentals…take a look at this graph:
There are some pretty wild takeways from the graph above:
During 2020 (the first COVID-market year) it’s impressive to see the total number of single family home sales basically doubled from the prior year - keep in mind that 2020 started off as a “normal” year and then the local real estate market effectively shut down for 2+ months during the COVID “lockdown”…so the spike in sales was largely attributed to about 6-7 months of the year!
Note that the total number of single family home sales over the past two years was very consistent, and at a level more or less simlar to the decade prior to 2020 (with the exception of the “mini-recession” for real estate in Aspen during 2016.
Now for the big “Wow”! The red represents sales between $10m and $20m and the green represents sales above $20m. Look how much more prominent those two colors are since 2020 compared to the 15 years prior.
Here’s an even more magnified way to look at the impact of post-COVID demographic and wealth shifts in the Aspen real estate market…the graph below shows the percentage of single family home sales represented each year by price segment:
The “red” and “green” segments of the annual Aspen single family home sales were more or less consistent for 10+ years prior to 2020. In fact, the “green” ($20m+ sales) never accounted for more than 5% of all annual sales, and the $10m-$20m segment perhaps grew modestly over time (which makes sense that as prices were rising there would be an increasing number of $10m+ sales).
How about the fact that $10m+ sales reached a “peak” of about 30% of the overall market in 2019, and that relationship has flipped…over the past two years single family home sales below $10m have represented about 30% of the market, with about 70% of all sales occuring above $10m!
And what about the upper-end of the market…$20m+ sales have accounted for 25%+ of the market the past two years…that’s an astonishing shift.
Think about all of the side-effects of these market dynamics, it now takes far fewer sales to generate the same annual sales dollar volume for the Aspen real estate market than it did just a few years ago. There is a correlation with higher price points selling at a higher price per square foot as well, so the stats automatically have skewed for people who track the average price per square foot in the Aspen market. Not to mention property taxes and how pretty much every home value and value per square foot has been artificially inflated simply by the rapid change in what the upper-end of the Aspen real estate market has experienced.
It will be interesting to see how these changes manifest in the coming months and years!
