Telluride real estate riding high

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Highlights:

  • Report tracking real estate sales in Telluride released.
  • Telluride is posting its best year since the Great Recession.
  • Realtor believes Telluride is smaller and more remote, but prettier than Aspen or Vail.
Tom Cruise is selling his ranch in Telluride. It can be yours for $59 million.

Tom Cruise is selling his ranch in Telluride. It can be yours for $59 million.

Telluride’s real estate market is riding high.

Real estate sales in Telluride in 2014 booked its best year since the Great Recession ended, even if movie star Tom Cruise has yet to sell his ranch.

“Well, he just put it on the market 60 days or so ago and he is asking $59 million, which is pretty aggressive in my opinion,” said veteran Telluride broker George Harvey.

“But you never know,” added Harvey, principal of The Harvey Team in Telluride.

“Telluride is becoming a global market,” added Harvey, who has been selling homes in Telluride for more than three decades.

A look at a room in the 10,000-square-foot home Tom Cruise owns in Telluride.

A look at a room in the 10,000-square-foot home Tom Cruise owns in Telluride.

Harvey also keeps close tabs on all of the Colorado ski resort markets including Aspen, Vail and Summit County resorts such as Breckenridge.

Cruise is listing his 298-acre Telluride spread with a 10,000-square-foot main house with Bill Fandel, of Telluride Sotheby’s International Realty.

A report released on Wednesday by Judi Kiernan , president of Telluride Consulting, showed in November buyers paid $36.8 million for real estate in San Miguel County, which includes Telluride and Mountain Village.

That is more than double the $18 million in sales in November 2013.

And in the first 11 months of the year, the dollar volume in the Telluride area hit $476.1 million, 72 percent more than the $276.6 million in the first 11 months of 2013.

That is the biggest year-over-year percentage gain since 1985, according to Harvey.

Telluride Consulting shows a 28-year graph of sales in San Miguel County, which includes Telluride.

Telluride Consulting shows a 28-year graph of sales in San Miguel County, which includes Telluride.

That also is more than double the $218.5 million in sales in the first 11 months of 2009, when Telluride, like all resorts, were being hammered by the banking and real estate crisis.

“We are going to hit about $500 million in sales this year,” Harvey said.

Telluride still is not near where it was in the peak, he said. The Denver-area housing market, by contrast, was one of the first markets in the U.S. to exceed its pre-recession peak, according to Case-Shiller and other national reports.

“We had $756 million in sales in 2007,” Harvey said.

“I think in 2009 through 2011, we probably lost 60 percent of our business,” Harvey added.

Harvey said the much bigger and more popular markets of Vail and Aspen recovered faster than Telluride.

Each of those markets will do about $1.5 billion in sales this year, he said.

“Those two markets are a heck of a lot bigger and easier to get to than Telluride,” he said.

A snapshot of November San Miguel County real estate sales activity, which includes Telluride. Source: Telluride Consulting.

San Miguel County real estate sales hit $36.8 million in November. Telluride is in San Miguel County. Source: Telluride Consulting.

“Telluride is much more like Jackson Hole,” in Wyoming, he said.

“Both Telluride and Jackson Hole are small market and remote,” he said.

“But I think my fellow brokers in Aspen and Vail and even Breckenridge and Steamboat Springs would agree that we are the best looking. We are the prettiest girl at the party. Telluride is drop dead gorgeous.” Harvey said.

Like the Denver housing market, Breckenridge could have even brisker sales if there were more houses to sell, he said.

“The Telluride market is clearly a seller’s market in every category,” according to Harvey.

“Condominium sales in the Mountain Village are moving toward a seller’s market with very few ‘deals’ left in that category.”

And the appreciation has been incredible, he said.

Mountain Village homes that couldn’t be sold in the last five years are being shown often with home sales up almost 300 percent,” according to Harvey.

The shortage will lead to a “big uptick in prices” in Telluride this year and in 2016, Harvey predicted.

He said that Conde Nast Traveler has picked Telluride as the best mountain resort for three years running.

A snapshot of YTD sales in San Miguel County, which includes Telluride. Source: Telluride Consulting.

YTD sales of about $500 million in 2014 in San Miguel County, which includes Telluride. Source: Telluride Consulting.

Telluride also is benefiting from director Quentin Tarantino shooting the $44 million “Hateful Eight” there.

“Telluride hasn’t had a big movie shot in Telluride since John Wayne’s “True Grit” in 1969, so that is big news for us,” Harvey said.

Affluent buyers are finally willing to buy a luxury home in Telluride and elsewhere that they do not need, Harvey said.

“No one needs a multi-million home in Telluride,” Harvey said.

“In 31 years of business, every home I have sold has been a discretionary purchase,” he said.

However, a few years ago, the super-wealthy were not willing to make a bet on real estate, or anything else, he said.

“If you remember what happened to the stock market in 2008 and 2009, it was crushed,” Harvey said.

“The truly affluent really had the daylight scared out of them by the Great Recession,” he said.

“Now, the stock market has been incredible for the last two or three years and they think is Ok to buy a home in Telluride.”

 

Another photo of Tom Cruises's 10,000-square-foot home on 298 acres in Telluride that is on the market for $59 million.

Another photo of Tom Cruises’s 10,000-square-foot home on 298 acres in Telluride that is on the market for $59 million.

And while small, a bigger percentage of the buyers are coming from outside of the U.S.

“I sold 2,400 acres for $17 million to a guy who made his money in investments in Singapore and has a presence in New Zealand,” Harvey said.

“He paid cash. He told me that this is something his children can inherit and he knows a government won’t put a gun to his head and take it away from him,” he said.

He said he also has seen investors from Argentina and Brazil buying real estate in Telluride.

“I haven’t seen any Russians yet, but they have discovered Vail,” Harvey said.

“You know with the ruble collapsing and oil prices being down by 50 percent, the wealthy in Russia are doing everything possible to get their money out of Russia,” he said.

“The most prestigious real estate in the world is in the U.S. and London,” Harvey continued.

“Buying a place in a Colorado ski resort is a status symbol of the truly wealthy.”

Telluride. "The prettiest girl at the party."

Telluride. “The prettiest girl at the party.”

Have a story idea or real estate tip? Contact John Rebchook at JRCHOOK@gmail.com. InsideRealEstateNews.com is sponsored by Universal Lending, Land Title Guarantee Co. and 8z Real Estate. To read more articles by John Rebchook, subscribe to the Colorado Real Estate Journal.

 

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John Rebchook

John Rebchook has more than 30 years of experience in writing and communications. As the Real Estate Editor for the Rocky Mountain News, he wrote about residential and commercial real estate for 26 years. He has won numerous awards for business stories and columns that he wrote, both as an individual and part of teams. In addition to real estate, he also covered economic development, banking and financing, the airlines, and cable TV for the Rocky. In addition, he was one of the original freelance writers for GlobeSt.com, covering commercial real estate for the Internet publication.

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