Colorado is a beautiful place to visit, and it remains to be one of the top travel destinations for people all over the world. Aspen, with its small mountain town-feel mixed with an upscale vibe, is one of the best places in Colorado to own real estate.
How can you find your dream mountain home, or good investment property, in today’s seller’s market? The low inventory and bidding wars have some homebuyers concerned, but we have the keys to help you navigate the current market successfully.
Defining the low inventory market
Long before the pandemic, the real estate market was already showing signs of tight inventory. Forest fires, hurricanes, and other natural disasters created raw material shortages. Homebuilders, especially in the Rocky Mountain area, have limited availability of suitable land for new construction. Since 2008, home builders have focused on building homes in the upper price ranges, opposed to those in the ranges more suitable for first-time homebuyers. The real estate market was already showing signs of tightening. Then the Pandemic hit, and a surge of homebuyers entered the market looking for larger living spaces and better outdoor areas, and many looked toward Colorado and Aspen. The result is a record number of homes sold last year in Aspen that is twice the number of homes sold in 2018 and 2019. Home values and sales prices skyrocketed. The median price of Aspen, CO homes for sale increased by about 35% on a price-per-square-foot basis.
Should you buy now?
Given the circumstances of our current nationwide seller’s market, many are left wondering if this is a good time to buy. When they hear news of bidding wars and homes selling at record-breaking amounts over the list price, they wonder if they will be paying overvalue if they buy now. Here is the thing to remember, in a low inventory market seller’s agents are listing their properties to encourage bidding wars. They are trying to gain attention and attract as many people as they can to their property for sale. So, they are not listing it at top value. They are listing it at a value that encourages multiple showings and bids. This way, the seller can choose the offer that suits them best. The seller might not even be worried about the price. Their top need may be about selling quickly to relocate for work. If the seller’s agent attracts multiple offers, then they can negotiate for an earlier closing date to meet the needs of their customer. So, yes. You should buy now because you are buying at a discount on tomorrow’s market. Home values will continue to rise because there will continue to be more buyers than available property. For the past 30-40 years, the value of real estate in Aspen has outpaced the S&P and commodity markets.
How to buy now
Get your financing ready before you start looking for homes to buy. Real estate is moving quickly; the average home in Aspen goes pending in 11 days and some as fast as five days. Make sure you are ready to make an offer and come through on that offer if it is accepted. Otherwise, you may find a home you love only to watch it sell to someone else before you can get your financing approved. Avoid adding contingencies to your offer. Aspen is in a competitive market, with many homes getting multiple offers and waived contingencies. Make sure your agent understands what you are looking for in your home. A well-connected agent may be aware of a property before it is listed on the market. If that property meets your needs, they need to know so they can make an offer before it reaches the public. Be sure you understand the process and timeline. You don’t want the deal to fall apart on your dream home because you didn’t respond on time. Being well prepared and communicating with your agent will help the process go smoothly.
A buyer’s agent has cultivated relationships
A buyer’s agent with experience in Aspen real estate has developed a reputation among their peers and colleagues. When your buyer’s agent has a close working relationship with other top brokers in the area, they know how to leverage your offer. Presenting the strongest offer comes down to knowing what the seller wants. A good agent knows it isn’t always about the price. An experienced agent, who is trusted by the seller’s broker, can dig down to find out what concessions are most important to the seller. If the seller has a strong emotional attachment to the property, they will have different priorities than one who only owned the property as investment real estate.
Buyer’s agents are strong negotiators
Many deals fall apart because the timeline isn’t met, or because the offer isn’t acceptable, or because they contained contingencies. A buyer’s agent, experienced with seller’s markets, knows how to navigate the deal all the way to closing. An agent experienced has a pulse on what constitutes a strong offer in today’s competitive real estate market. An experienced realtor, who has your best interest in mind, will be there for the appraisals and the inspections. They keep the lines of communication open with the listing broker and communicate with them until the deal is closed, and not just under contract.
Credit: Listing Courtesy of Maureen Stapleton with Coldwell Banker
How to find the right buyer’s agent
Do your research. Make sure the agent is established in the area and understands the current trends and conditions affecting Aspen real estate. Meet them in person and make sure your goals align with theirs. A good agent will not make you feel pressured. They will talk with you and make sure you understand the process. They will find out what is important to you and how you want to utilize the property so they can meet your needs. They won’t waste your time with properties that don’t meet your needs or are out of your budget. Ask them what sets them apart from other agents in the area. If you are selling property, be sure to go over how they plan to market your home. Most importantly, trust your gut. You must be able to trust your agent and build a relationship with them to ensure your goals are met.
Many buyers chose to work with Ksenia because she genuinely cares and delivers an impressive amount of research and inside market knowledge, built on many years of relationships with the top agents, builders and developers who call her first when something is offered off market.