Colorado Luxury Home Sales Climb as Wealthy Bargain-Hunt
Mixed signals about what the wealthy are doing with their money are everywhere. One day we hear via Scorpio Partners that the rich might have as much as $26 trillion stashed away that they're not giving to banks and wealth managers. Meanwhile, The New York Times reports that a growing number of homeowners with million-dollar-plus mortgages have simply stopped making payments.
On the other hand comes word that high-net-worth buyers are apparently loosening their wallets a bit to purchase homes in swanky Colorado resorts like Vail and Aspen. It's not a bellwether market like Manhattan, or course, but some say the flicker of activity in this micro-market favored by high fliers could be a signal that the end of the Great Recession is near and a real estate rebound is on the way.
It's more like a blip, as high-end buyers cherry-pick discounted properties while the getting is good.
True, there have been some flashy deals out there amid the foreclosure auctions of multimillion-dollar properties in these luxury ski areas.
Last month hedge fund honcho John Paulson bought a $24.5 million ranch and home in Pitkin County (home to Aspen and Snowmass), reports the Colorado Independent. and there were 12 transactions totaling $42 million in Vail in May, with six homes selling for more than $4 million,
Overall, the dollar volume of real estate sales more than doubled in Eagle County (home to Vail and Beaver Creek) in the first five months of 2010 compared to a year ago, the newspaper says, citing figures from the Land Title Guarantee Co.
But despite the encouraging numbers, these sales appear to be selective purchases at knocked-down prices -- OK, discount here might mean taking $5 million off the top -- and reflects the fact that buyers are scooping up properties in a depressed market.
"I don't think personally it's a sign that we've bounced back and now everybody's jumping back in," said broker Led Gardner of Slifer Smith & Frampton Real Estate. Instead, he said, buyers are recognizing "the opportunity being presented." Of course, the Paulson purchase is impressive, but recall that Pitkin County had the record sale of a $47-million ranch back in in 2006.
Seems the rich are just like us after all -- always searching for a bargain.
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