Market Update

A true ski-in / ski out offering, this beautifully-crafted log and stone is ideally located directly on the groomed Double Cabins ski run of the Telluride Ski Resort. The custom-built home offers the warmth,quality and tasteful accommodations of a true mountain lodge with the modern finish and amenities you’d expect with a residence of its kind.The home’s spaces offer wonderful proportions radiating out from its towering great room and expansive windows framed by hand-hewn log trusses. Stacked stone fireplaces, antique flooring, custom doors and rustic ironwork complement the gourmet kitchen,intimate Master suites,guest rooms bunk area. In Summer Fall the snow-covered ski run turns to hiking trails leading into National Forest from your back door.

To view this listing, as well as other spectacular properties, click here

Uncompromising, Full-Service, Slopeside Living.  At last!

Madeline Residences, a first-of-its kind ownership opportunity in Telluride, just released their first allotment of fully-furnished and turn-key condominium residences on February 1, 2015, and the initial response has been staggering with 8 residences already under contract.  The Ownership Group has committed $15m in residence and property upgrades which will include two game-changing amenities:  a New Porte-Cochere and Outdoor Pool to be completed by December of 2015 and a new New Club Room to be completed July of 2015.  With the ideal slopeside location just steps from the Gondola to Storybook Telluride and unparalleled four-diamond services and amenities, this is game-changer in Mountain Village real estate.

MADISON, NJ — (Marketwired) — 07/24/13 — Realogy Holdings Corp. (NYSE: RLGY), a global leader in residential real estate franchising and provider of real estate brokerage, relocation, and title and settlement services, today reported financial results for the second quarter ended June 30, 2013, including the following:

• Realogy’s net revenue for second quarter 2013 was $1.53 billion, a 17% increase compared to the same period in 2012.
• The Company’s Adjusted EBITDA1 was $278 million in the second quarter, an increase of 27% year-over-year.
• Net income attributable to the Company in the second quarter was $84 million, an improvement of $109 million compared to the second quarter of 2012. Net income includes $67 million of interest expense, $44 million of depreciation and amortization, $43 million of debt extinguishment charges and$26 million of compensation expense relating to the April 2013 issuance of common stock under the phantom value plan.
• Basic earnings per share for the quarter was $0.58, or, excluding the loss on early extinguishment of debt and phantom value plan compensation expense, would have been $1.05.
• The Company also retired $330 million of high cost debt and refinanced $492 million of 11.5% debt with $500 million of 3.375% debt, reducing its annual cash interest run rate to approximately $255 million per year.

“The material improvement in our second quarter financial results is largely attributable to the strength of our business model, the strong performance of management, a dramatically improved balance sheet with a corresponding material reduction in interest expense, and a housing market recovery that is showing resiliency,” said Richard A. Smith, Realogy’s chairman, chief executive officer and president.

The Company’s combined transaction volume increased 21% during the second quarter of 2013 compared to the same period last year. The Realogy Franchise Group (RFG), our franchise segment, and NRT, the operator of our company-owned brokerage offices, reported closed homesale transaction side gains of 10% and 12%, respectively. Average homesale price improved 10% at RFG and 7% at NRT compared with the second quarter of 2012. NRT’s average home price is generally twice the national average.

In our relocation business, while second quarter revenue was essentially flat, Cartus experienced a 19% increase in broker referrals and a 5% year-over-year increase in initiations compared with 2012. In our title and settlement services segment, Title Resource Group (TRG) experienced a 14% increase in purchase title and closing units compared to the second quarter of 2012 and a 30% increase in refinance title and closing units.

“Recently, there has been renewed focus on rising mortgage rates and what impact they will have on the housing market,” continued Smith. “While rising rates have had an effect on refinancing volume, thus far we have seen no near-term impact on existing home sales. We view rising rates as a reflection of a healthier economy, and while mortgage rates may put near-term pressure on certain homebuyers, this needs to be viewed in the broader context of overall affordability, which remains at historically high levels. We believe the recovery is, and will continue to be, a long-term process.”

“Looking ahead, we expect continued growth in transaction volume, with 17% to 19% increases in the third quarter compared to the third quarter of 2012,” said Anthony E. Hull, Realogy’s executive vice president, chief financial officer and treasurer. “On a combined basis, RFG and NRT transaction sides are anticipated to increase 9% to 10% and average sale price is expected to increase 8% to 9% year-over-year in the third quarter. This business growth trend will drive continued strength in our revenue and EBITDA results for the third quarter.”

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On June 2 – 5, 2013, I was fortunate to be among 1,400 Sotheby’s brokers from 26 countries who attended the Sotheby’s International Realty Global Networking Event and Conference in Los Angeles, CA, which was illuminating and encouraging, to say the least.

Some immediate takeaways provided by Richard Smith, Chairman of Realogy Holdings (the country’s largest real estate firm), along with Henry Howard-Sneyd, Vice Chairman of Sotheby’s Auction House, revealed some reassuring conditions across the world.

More specifically the insights we received at the event included the following:

• By all conclusions the recovery in real estate is substantive, widespread and sustainable with continued growth and demand across all major metropolitan areas
• Despite meteoric growth in prices in places like San Francisco and Miami, most growth is far more balanced in its price/ inventory ratio
• The demand crunch caused by a lack of inventory in many markets can be attributed to an under-supply of new housing stock, combined with a percentage of properties still under water relative to value. With continued demand, increased prices and the return of new housing stock, the markets will provide greater inventory to meet the foreseeable demand
• Unemployment rates will remain higher in the immediate term, but new household creation will help absorb inventory
• Tax havens like Florida and Texas are benefitting greatly from the onerous income & state taxes being levied in places like California, New Jersey, Connecticut, New York and Massachusetts
• Growth will be uneven in the years ahead as Midwestern states such as North Dakota, Indiana and Nebraska will see the greatest broadening of their economies, and have clean balance sheets and low-levels of municipal debt.  Meanwhile, cities in California, along with a city like Detroit, will face municipal bankruptcies if solutions for overarching debt is not approached more deliberately
• Texas, with its booming economy which can be attributed to the growth in the energy sector, along with other  energy supply-side states, such as  North Dakota, will see continued job growth, as America’s push toward greater energy independence brings continued windfall to these areas and their related economies
• Second-home markets have seen notable recovery, though it’s been less consistent quarter-to-quarter. Markets like Palm Beach, Montecito, Naples, FL, Nantucket, and The Hamptons have all seen strength across all market segments; while the mountain states saw great pockets of strength in Q3/ Q4 of 2012
• Telluride and Durango, Colorado both saw consistent strength in the beginning of Q2 and we each anticipate a strong summer with Texans again driving the market’s vitality across all market segments and price points

This information was re-enforced by the following article describing the return of vitality to the second home market on Bloomberg’s Market Watch site: http://www.bloomberg.com/news/2013-06-14/u-s-vacation-home-rebound-lifts-hilton-head-to-hawaii.html

Bill Fandel of Telluride Sotheby’s International Realty speaks on specialty markets at the Global Networking Event

See additional photos from the Sotheby’s International Realty Global Networking Event 2013:  https://www.facebook.com/TellurideEstatesBillFandel#!/media/set/?set=a.367884809978584.1073741831.281367361963663&type=3

Market Update – Telluride

 Telluride, CO (Bill Fandel – Telluride Sotheby’s International Realty)

Telluride market conditions were very strong Q3 and Q4, with an overall record number of sales over $10m marketwide in 2012.  Since the first of the year, tracking closely with the sunset of lower capital gains and tax rates, we saw a substantial decline in sales activity in Q1 closely paralleling with the Aspen market.  Despite a very slow Q1, we are seeing a return of vitality to the market. 

 Buyers continue to be North American in origin, with some Latin American buyers mixed in. Particular concentrations of buyers continue to be from Texas, New York, Florida, and California.  We’ve seen a growing number of inquiries from wealthy Californians interested in exploring relocation of their primary residence to their Colorado second-home to flee the growing tax burdens California has instituted.

 I’ve quizzed a number of clients on their outlook and confidence about the economy, with most showing measured optimism about the property markets but continued caution surrounding the eventual unwinding of the Fed-driven policy that continues manipulating interest rates.

 Property acquired with cash and very cheap debt may prove a strong and stable alternative investment to other investment classes.

 Inquiries for summer rentals, single family homes, condos, and ranches are all on the rise.

 Market Update –North America

 Recently I discussed market highlights around the country with some of my global partners at Sotheby’s International Realty.  Here are some points of interest:

 Seattle, WA ( Stacy Jones – Realogics Sotheby’s International Realty)

• The Metro Seattle area is witness to a dramatic housing market rebound since completing its post-recession correction during the first quarter of 2012. 
• Major employment growth from retail titan Amazon.com, which alone has sparked more than 3 million square feet of new office space demand in downtown Seattle, coupled with regional expansion at Fortune 500 companies that includes Boeing, Microsoft, Starbucks and Nordstrom is driving local housing demand. 
• Collectively corporate growth in the region is drawing thousands of relocating professionals to the Emerald City, including a significant influence from foreign countries, especially Mainland China chasing H1-5 visas for tech workers. 
• Demand has risen much quicker than supply.  This has caused a seller’s market with less than two months of inventory available in most metro markets. 
• Only new apartments have been built to address the quickly expanding population base in the City of Seattle (the number of households in downtown Seattle has expanded by 35% since 2000 and is expected to rise another 10% over the next five years).  Rents are expected to rise another 5.5% in 2013 despite thousands of new apartments being delivered (in fact it’s now more expensive to rent than to own in moderately priced segments in the city).

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Aspen, CO (Craig Morris – Aspen Snowmass Sotheby’s International Realty)

• December was by far the best month we’ve had in over 4 years, followed by 3 straight months of lackluster figures.
• Our buyers are mainly from the US, but our international crowd has picked up some in the past few years, mostly from the UK and Australia.
• Majority of our buyers come from Texas, California, New York, and Florida. 
• Increase in buyers from the Midwest; Chicago, Cincinnati, Michigan and Iowa, and several from Toronto 

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Chicago, IL (Chris Feurer – Jameson Sotheby’s International Realty)

• Severe lack of inventory virtually over night
• Trend started in fall of 2012
• Multiple bid situations are pushing prices higher quickly
• Prices are climbing so quickly that appraisals are becoming an issue
• New construction is creeping back into our market
• We anticipate some brand new rental towers will choose to go condo based upon buyer demand

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Washington DC (Michael Rankin – TTR Sotheby’s International Realty)

• Luxury buyers are back: 24% increase (Q1 2013 vs Q1 2012) of home sales over $1 million in the Washington Metropolitan Area.
• A rapid pace: 33% of $1 million plus sales in Washington, DC were on the market for less than one month.
• Inventory shortage at all price points: Today only 6,000 homes are for sale in the entire DC Metro, down from an April 2008 high of more than 25,000 homes

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New York, NY (Royce Pinkwater – Sotheby’s International Realty New York)

• New York City is currently the number one market in the world, taking the spot from London, according to the latest Knight Frank Report.
• The market is booming at the top end, with lack of inventory being the biggest issue.
• Record prices being paid for co-operative and condominiums.
• Downtown is very hot – new condo 150 Charles sold very quickly.
• Most overseas buyers purchase condominiums.

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Toronto, Ontario, Canada (Fran Bennett – Sotheby’s International Realty Canada)

• Q1, 2013 sales down by 14% (compared to Q1, 2012). This is due to a lack of inventory.
• Q1, 2013 average sale price up by 3.8% (compared to Q1, 2012)
• We are continuing to experience a severe shortage of properties to sell and therefore our market is seeing multiple offers on almost anything for sale (excluding condos) up to $1.5 million. We don’t seem to be able to build any inventory which is what we were hoping for this spring to return the market to a more balanced position.
• Condo sales are down, while the inventory of new condos is high and increasing. We currently have 140 new condo buildings under construction. In particular, the market for new condos in the top-tier (over $2 million) has experienced a significant and sustained softening of demand.

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Hamptons, New York (Dana Trotter – Sotheby’s International Realty The Hamptons)

• The market here is heating up – the warmer temperatures are bringing both buyers and renters.
• We are seeing a shift towards seller’s market for the first time since 2006.
• Bidding wars are happening in all segments especially the properties in the lower ranges (under $2m)
• Generally the market is extremely active up to $10m with little quality inventory from $5m – $10mm

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Greenwich, CT  (Shelly Tretter Lynch – Greenwich Sotheby’s International Realty)

• The market has definitely picked up
• Single family home contracts are up year-to-date by 7.8 %
• The $5 plus million dollar market (off the water) is actively trading.  Quite a bit of old inventory is under contract
• Bidding wars, recently forgotten, are now appearing
• New construction starts are up.  I have listed two new construction homes in the $8 million range
• Confidence  (in values) for the Greenwich properties is at the highest level in 4 years
• Back country is starting to see more activity
• I believe that both buyers and sellers are becoming more realistic
• We are seeing our “long term” tenants now buying
• Very attractive to foreign buyers

Despite a slow start to sales in 2012, the Telluride real estate market showed substantial momentum across both Q3 & Q4 with some dramatic sales activity across multiple market segments through the end of the year.

The market saw a new record number of transactions close over the $10m mark for the year with two sales over $12m in Mountain Village, one over $12m in Gray Head, three other ranch sales over $10m in the outlying areas, and several others north of $6m.

There was a flurry of activity within the historic Town of Telluride, with transactional volume up over 30% for the year and prices per square foot moving above the $1,000 per foot mark for homes over $2m.

Other statistics of note according to the Telluride MLS:

•             Gross dollar volume was up over 40% market-wide, with transactional volume up over 10%

•             100 sales over $1m, with 65 sales over $2m

•             Average prices were up over 35%, with median sales prices up over 14%

•             The average sales price for single-family homes in Mountain Village was an estimated $3.9m

•             Both inventory and average days on market were down 8% and 17% respectively, showing definitive signs of a strengthening in the overall market and a stabilization of pricing

By Brad Nelson of TTR Sotheby’s Inernational Realty

Washington, DC may have been the most exciting city in America in 2012. We had front row seats to the Presidential election. We watched new restaurants open from award-winning chefs like José Andrés and Mike Isabella. Our skyline once again became dotted with cranes — the ultimate indicator we have exited the economic crisis and are building for the future. And the Redskins, Nationals and Capitals all made it to the playoffs.

The impact of this good news in the residential real estate market is clear. Our firm’s sales volume was up 51.9% year-over-year, rising to over $1.3 billion. RBI Intel’s latest data notes that prices across the region have reached record highs. And The Wall Street Journal is predicting prices to rise based on tightening inventory in 2013.

The residential real estate market is improving quickly. If you are considering selling or purchasing real estate in the Washington Metropolitan Area or around the world in 2013, it would be our pleasure to be of service.

Market conditions have been quite strong during what is typically a slower time of year, with nearly $248m in closed sales and pending contracts in the last 90 days. 

Some notable statistics for the period include:

• 60 sales over $1m
• 11 sales over $4m
• 6 sales over $7m

Significant Sales included the following transactions:

SOLD – Eagle’s Rest – $12,300,000 – Dec, 2012

SOLD – Ballard Penthouse – $3,400,000 – Dec, 2012

• Two Mountain Village homes at $9.9m and $12.3m respectively
• Two ranch sales of $12m & $17m
• Two penthouses in the historic Town of Telluride of $4.7m and $3.4m
• Average selling price for properties in and around the resort area was roughly $2.27m
• Sold to List Price Ratio climbed from roughly 76% at the bottom of the market to nearly 90% of sales in this period
• Days on the market has come down by nearly 1/3 for this segment as well
• Average selling prices for SFH homes in the historic Town of Telluride have climbed to $1,027 psf

We have seen a brief slowdown in showing activity since the presidential election; though that can be partly attributed to seasonality, with most closings on schedule for before the first of the year in the interest of securing lower than forecast capital gains rates.

As to trends readily identifiable in this market, the highest quality assets offering perceived value in the best locations, be it ski-in/ ski-out locations or in the heart of our historic core area continue to generate the most interest and strongest pricing.

To a prosperous New Year…

READ MORE:  http://www.businessinsider.com/the-luxury-real-estate-market-in-2013-2012-11

While October and November are typically slower times of the year in the mountain resorts of Colorado, a vibrant real estate economy combined with great Fall weather has defied the standard “off-season” status in Telluride.

The dynamic market conditions in the historic Town of Telluride have finally made their way over the hill into the Mountain Village with significant sales now taking place in both segments.

The link below showcases a series across the market that includes 4 contracts over $4m in this past week alone.

With the election finally behind us, the market looks poised to continue a strong upward trend as we head toward Thanksgiving.

Click the link below for detailed sales insights….

http://www.flexmls.com/link.html?x4gksbhoipq,2,1