Are Prices Going Up?
Hello from Breckenridge, Colorado!
Are prices going up yet?
Get the quick answer from our 1-minute video, or see the details below.
The short answer is: County-wide, overall average selling prices are starting to rise, but that is only because there have been a few more sales of luxury properties vs affordable properties. Prices in a given complex or subdivision are, for the most part, flat.
The chart below shows the average sold prices for residential properties in Summit County.
- “Residential” means homes, condos, townhomes, duplexes, or vacant land
- The data for 2006-2011 is for the full year. The data for 2012 is from 1/1 to 4/30/12.
- County-wide, the average sold price in 2011 was $495,931. The average sold price so far in 2012 is $516,595. That’s an increase of 4.2%. So prices are going up, right? Not necessarily. See the bullets below the chart!
- Suppose there were just two choices: Cozy Condos or Fancy Homes. In 2011, there are 10 sales of Cozy Condos, each at $300,000. There are 2 sales of Fancy Homes, each at $1,000,000. The average selling price is [ (10 x $300K) + (2 x $1M) ] / 12 = $416,667.
- In 2012, the market improves and there are more sales of everything. We go from 10 to 12 sales of Cozy Condos, again at $300,000 apiece. And one more Fancy Home sale than last year for a total of 3 sales, again each at $1,000,000. The average selling price is [ (12 x $300K) + (3 x $1M) ] / 15 = $440,000.
- That’s an increase in the average selling price of $440K / $416.7K = 5.6%. Yet, Cozy Condos sold for $300K and did not go up in price. Fancy Homes sold for $1M and did not go up in price. Overall aggregate market statistics can be misleading.
- To really know what’s going on with prices, you have to look at selling prices per square foot in a specific complex or subdivision such as One Breckenridge Place. That’s the approach we take.
So, now you know the story on overall market averages vs prices in a specific complex or subdivision. Believe it or not, we have even more data, so if you like market statistics, you know who to call!