The Jackson Hole Report is the most accurate and trusted real estate market report in Teton County, WY. We derive our statistics from a privately-maintained database that tracks every single sale, not just the ones reported through MLS.
Ever since our market hit bottom at the end of 2009, sales have steadily increased, staring with Q1 2010 and continuing with year-to-year improvements through Q1 2014. However, in spite of our strengthening market performance, the shortage of inventory has hindered buyers’ ability to find the right property. Available single-family home inventory is at a 25-year low, and the overall available inventory – homes, lots, condos, commercial and ranches – is the third lowest in 25 years. Residential vacant land is the only segment with more than a year’s supply of inventory. However, expect rapid depletion in this segment as well.
Where did the inventory go? As discussed in the year-end 2013 Jackson Hole Report, I believe four major factors contribute to this answer:
1) Speculation building: Jackson Hole felt the affects of the worldwide banking collapse in 2008. Immediately, speculation building came to a screeching halt. Since then, very few new residential homes and condo/townhomes have been built on speculation, falling far short of demand for new construction. This is due to the reluctance of contractors and mortgage bankers to speculate so soon after the great recession. Such reluctance combined with higher labor and construction material costs, a new shortage of skilled labor in Jackson Hole, and slowly recovering appraisal values, means we should not expect speculation building to return in 2014;
2) Distressed sales: Since 2008, approximately 350 homes and condo/townhomes in Jackson Hole were considered distressed sales. While the distressed property inventory dried up in 2013, many people who lost or had to sell their residences did not move away; instead, they relocated to rentals. Meanwhile, many buyers of these distressed properties were investors who placed their new purchases in the local rental pool instead of reselling them as the market recovered;
3) Pent-up demand: As our market recovered, pent-up buyers who had waited for the market to bottom out pounced on properties, accelerating sales. In the five years leading up to the great recession, Jackson Hole averaged 930 sales per year, but after 2008, the average number of sales dropped to 430 per year, which equates to 3,000 fewer buyers over the last six years. These patient buyers are back, many with cash, ready to jump on any new listing priced at market value;
4) Shadow inventory: In Jackson Hole, local Realtors consider shadow inventory as properties that were placed on the market during the recession, but did not sell. Some were overpriced at pre-recession values, while others languished due to the dearth of buyers. Today, many of these sellers are reluctant to put their homes back on the market in the face of rapidly increasing values. Meanwhile, other sellers are relisting their homes but unfortunately at pre-recession prices. NOTE: 38% of current available inventory – homes, lots, condo/townhome, and commercial – have been on the market before. Of those 145 listings, 132 (91%) have been on the market for more than a year and 74% for two-plus years.
Combine these factors with a recovering local economy and a 4.4% unemployment rate in Jackson Hole, and therein lies the layered answer.
THE OVERALL MARKET
When compared with the first three months of 2013, the overall market has slowed due to dwindling inventory. The number of sales dropped 12% and the overall dollar volume was down 14%. In contrast, the median sale price was up 21%. The increase in the median sale price reflects the lack of sales under $500,000, down 78% when compared to Q1 2013. In terms of price point, the most activity was seen between $500,000 and $1 million, where 37% of overall transactions occurred. Geographically, the Town of Jackson and south to the Teton County line experienced the most activity, which in total accounted for 51% of all sales in the valley.
The overall upper-end of the market – properties priced at $2 million and above – has experienced a slowdown in sales, dipping 18%. Half of the upper-end sales in Q1 2014 were single-family homes, with a majority on the Westbank. The number of upper-end properties under contract has increased by 63%. NOTE: There are 47 properties on the market in the $5 million+ price range, down 28% from Q1 2013. The most expensive listing remains Jackson Land and Cattle Company, a property priced at $29 million spanning 562 acres in Spring Gulch with eight individual 35-acre parcels and a full equestrian facility, plus 3,000 sq. ft. event center. To learn more about the luxury market, please visit www.JacksonHoleLuxuryReport.com.
Overall properties under contract in Q1 2014 versus Q1 2013: the overall number of properties under contract is down 19%. In contrast, the dollar volume is up 41%, and the average list price spiked by 74%. While the number of vacant residential land and commercial properties under contract increased, single-family and condo/townhouses under contract both fell due to the dearth of available inventory. Single-family homes and condo/townhouses still make up 69% of the properties under contract, and 60% of the properties under contract are listed below $1 million.
Overall inventory of active listings dropped by 22%…
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