October 2023 – The Park City Realtors continue to see fewer sales, but at higher prices, as the local market continues to recover more than two years after the roller coaster ride called the Covid-19 pandemic.
When Covid-19 hit with a vengeance in Spring 2020, the real estate world went into a tailspin. Active listings fell from over 2,000 to only 600, with barely half of those being residential listings. With limited supply and soaring demand driven at least in part by remote workers seeking to relocate to the pastoral settings exemplified by Park City, sale prices climbed by 50% over the next two years.
With inventories returning to a more normal pre-Covid level, and competition for available properties still running strong despite record high mortgage interest rates, 3rd Quarter sales totals for single family homes in Summit and Wasatch Counties were 46% higher than in 2nd Quarter, but the longer lens of year-over-year change showed sales dropped 25%, while prices remained steady to up slightly. The median home sale price in the PCMLS primary market area increased just $10,000 for the year ending 9/30/23 vs. the same period ending 9/30/22. The quarterly increase in sales volume presages the direction consumers should expect to see in both prices and sales volume in the year ahead.
This decrease in local market price volatility reflects trends seen elsewhere in the Country, as business returns to a more “normal” seasonal pattern.
- Listing inventory is rising – In January 2022, only 235 residential properties were for sale. By the end of 2022, that number had nearly tripled to 738. At the end of September 2023, residential inventory was up 43% to 1,054 homes. Inventory continues to recover to pre-pandemic levels.
- Prices are starting to level off – For the 12 months ending 9/30/22, the overall median sale price of all single-family properties was $1.59 million. For the same period ending 9/30/23, that price was $1.6 million, a change of less than 1%.
- Buyers are becoming more hesitant to make instant offers above the asking price and sellers are reacting by lowering those asking prices at a faster pace. In 3rd Quarter 2022, 763 active listings saw at least one price reduction. In 3rd Quarter 2023, that number rose to 817. Many listings reported multiple price adjustments.
In Summit and Wasatch Counties, the rate of sales (number of units sold) dropped 25% for single-family homes and 36% for condominiums from the full year prior. Sales declines across the region were attributed to continuing high mortgage interest rates and low available inventory, with the latter being the prime driver. Agents noted that the large majority of homeowners still carrying a mortgage financed their purchases at rates from one-third to one-half below the current prevailing market rates, making them extremely reluctant to sell if they have to finance a replacement home elsewhere.
Park City neighborhoods vary widely in price comparison and the3rd Quarter year-over-year results continued that pattern.
For single family homes, all five of the major areas that make up the Greater Park City Market showed drops in units sold through the 3rd Quarter of 2023 vs. 2022. The exceptions were in neighborhoods where new construction is booming. Sales in the Silver Creek Village area nearly doubled over the previous year. A majority of the sales were newly completed or construction in progress on average prices just over $1.2 million. In Tuhaye, on the east side of the Jordanelle Reservoir, Talisker Club sales continued strong with units up 16% on volume of $108 million (up 42%) making for an average sale price over $3.7 million, up 22%.
Condo sales across the primary market range followed a pattern similar to single family homes. Year-over-year sales volume declined in all areas by 31%, primarily due to a lack of inventory to sell. Also, owners of those few properties who were willing to sell were holding out for much higher offer prices. Within the Park City limits, condo sales volume was down 32% but the median sale price rose 10% to $1.65 million. In the Snyderville Basin, the average sale price only rose by 1% to $1.25 million.
Comparing the 12 months ending September 30, 2023, to the same period ending in 2022:
- Residential inventory (single-family and condo) year-to-date is showing signs of recovery after a lengthy period of declines. At the end of September 2022, there were just 826 residential listings for sale in the entire PCMLS coverage area. On September 30, 2023, that number had grown to 1,054.
- The market is cooling off after an overheated two-plus years of sales. PCMLS members signed 1,894 residential purchase contracts for the twelve months ending 9/30/23, 22% fewer than the previous year (2,445).
- With New Listings running slightly higher than Pending contracts, inventory is being replaced faster than it is selling. For the nine months ending 9/30/23, 2,299 listings were added to the system. For the same period only 1,558 were put under contract. That’s 741 more listings added than contracts written.
Single Family Homes
The number of units sold across the primary market area (Summit & Wasatch Counties) dropped 25% year over year but increased 46% quarter over quarter. The short-term gain probably indicates a trend of increasing sales that would show in the year-over-year totals in coming quarters. A slight increase in the median sales price to $1.6M was not enough to prevent a 22% drop in total sales volume.
Highlights of the single-family home market:
- Within Park City limits, total unit sales were down 26% to 98 units. Sales volume declined 26% to $451 million in the past 12 months.
- The median price of a single-family home within Park City limits fell 8% to $3.57 million.
- Only 27 homes have sold in the popular Old Town area in the past 12 months. The median price dipped slightly (-3%) to $3.5 million.
- Snyderville Basin residences followed the prevailing market with sales volume (down 11%) on a modest gain in the overall median price up 5% to $2.1 million.
- All but two Snyderville neighborhoods (Silver Creek South and Canyons Village) saw declines in units sold, with Silver Creek Estates dropping the most (41%) to just 10 units. Canyons Village saw a slight increase of 18% to 13 units sold at a median price point now over $10 million. Silver Creek South showed a gain with 41 homes sold, nearly double the previous year, thanks to their second lowest price point in the Basin ($1.16 million) as well as many new construction units happening in Silver Creek Village. One-third of overall sales volume in the Basin was in Promontory ($333 million).
- Silver Creek South also had the biggest price increase in the Park City Metro area with the median rising 38% to $1.25 million.
- Canyons Village held on to crown of “most expensive area” with a median price topping $10 million for the first time.
- Among the outlying areas, the Jordanelle area showed the greatest median price increase of 65% as more and more luxury homes are coming to market in anticipation of the opening of the new Mayflower Ski Resort.
Despite fluctuations in the regional markets, single family sales activity in the primary market area was markedly down compared to the year prior, with sales volume of 22%, while prices were steady but mixed.
| Single Family Y-o-Y Summary End of Q3 2023 | Qty Sold | % Chg | Sales Volume | % Chg | Average Price | % Chg | Median Price | % Chg |
| Park City | 98 | -26% | 451,822,608 | -26% | 4,610,434 | 0% | 3,570,000 | -8% |
| Snyderville Basin | 282 | -14% | 872,518,359 | -11% | 3,094,036 | 4% | 2,107,500 | 5% |
| Jordanelle | 81 | -46% | 255,606,143 | -21% | 3,155,631 | 46% | 2,897,782 | 65% |
| Heber Valley | 227 | -22% | 291,936,090 | -30% | 1,286,062 | -10% | 899,990 | -14% |
| Kamas Valley | 76 | -38% | 104,495,513 | -41% | 1,374,940 | -5% | 1,029,350 | -13% |
| Total Primary Market Area | 809 | -25% | 2,008,238,615 | -22% | 2,482,372 | 4.6% | 1,600,000 | 0.6% |
| Total Overall MLS Area | 942 | -24% | 2,162,418,509 | -21% | 2,295,561 | 3% | 1,450,000 | 1% |
* Primary Market totals include only Summit and Wasatch Counties.
Condominiums
Prices in the condominium market across the entire Wasatch Back were mixed. The Park City and Jordanelle areas showed increases of 7-10%, while condo prices in Snyderville fell 11%. These variations cancelled each other so that the overall median remain flat at $1.05 million.
- The Condo market in the Old Town neighborhood paralleled the single family numbers, with unit sales and volume down. The median price of a condominium sold in Old Town was $1.1 million.
- Price gains were evident in all neighborhoods, with Upper Deer Valley leading the gainers with a 41% median increase to more than $3.5 million.
- In the Snyderville area, outside of perennial volume leader Canyons Village, Pinebrook and Kimball Junction led in sales volume ($29M and $33M respectively).
- In Wasatch County, (areas where 10 or more sales are reported) Jordanelle Park showed the largest gains in sales volume over the prior year (up 46%) despite a decline in median price, down 18% to $805,000.
| Condominium Y-o-Y Summary End of Q3 2023 | Qty Sold | % Chg | Sales Volume | % Chg | Average Price | % Chg | Median Price | % Chg |
| Park City | 232 | -32% | 524,765,456 | -23% | 2,261,920 | 13% | 1,650,000 | 10% |
| Snyderville Basin | 264 | -52% | 329,835,996 | -51% | 1,249,378 | 1% | 927,000 | -11% |
| Jordanelle | 210 | -11% | 232,350,707 | -7% | 1,106,431 | 5% | 1,034,006 | 7% |
| Heber Valley | 40 | 14% | 33,163,250 | 55% | 829,081 | 36% | 495,000 | -0% |
| Kamas Valley | 3 | 0% | 1,733,500 | 6% | 577,833 | 6% | 585,000 | -3% |
| Total Primary Market Area | 749 | -36% | 1,121,848,910 | -31% | 1,497,796 | 7% | 1,050,000 | 0% |
| Total Overall MLS Area | 797 | -34% | 1,147,414,360 | -31% | 1,439,667 | 5% | 1,000,000 | -3% |
* Primary Market totals include only Summit and Wasatch Counties.
Opinions and Observations
What do Park City agents see coming in the next few months? Here are a few observations about the important market results that point the way, coming from those with their fingers on the pulse of the market.
- Generally, units sold and sale volume are down across the region due to lack of inventory to sell, while prices are increasing but not at the high rates we have seen in previous quarters. Despite slowing sales, prices have not been dropping and are not showing any sign of letting up.
- Heber City and Midway used to be considered more outlying or rural, but with the expansion of Deer Valley Resort through its management deal with the new Mayflower development, Heber Valley is no longer sleepy or rural, it is now “ski country” and home sales are starting to reflect that change. Barely one-fourth of the homes for sale in Midway are priced below $1 million.
- In the luxury private club communities, agents are seeing more and more buyers opting for completed homes, rather than buying a vacant lot and building their own.
- Many buyers who purchased vacant land during the pandemic and who then couldn’t find an architect or builder with bandwidth to design and construct their dream homes, are now reselling the land and purchasing completed houses.
- Historically high interest rates are expected to continue well into 2024.
- Inventory has improved significantly but remains 1/4th less than pre-pandemic levels primarily because of the high interest rates. Owners with an older mortgage at 3% or less can’t sell unless they can pay cash for a replacement home.
- The high interest rates are affecting condo sales more than single family because mortgage financing is used more often in condo purchases, whereas over half of the single family residences closed in the past year have been all cash sales. 369/798 46% condo 374/947 SFH 39%
- Usually, the percentage of condos purchased with cash is greater than the percentage of home cash sales (see chart). In the 3rd Quarter, however, single family cash sales exceeded condos for the first time in three years and only the second time since 2006. The overall percentage of all cash sales has remained right around 50% since 2010. Interestingly, for Q3 total cash sales were 57%; this is a 3rd Quarter record and if this trend even remotely continues, we will set an all-time record for cash sales this year.
- As we move into the next election year, we expect housing activity overall to decrease somewhat as people feel more uncertain about the economy in general and how the next administration in Washington can or will handle the economic uncertainties.
- Buyers should not interpret broad market trends as applicable to a particular neighborhood in which they are interested. Home prices vary widely from neighborhood to neighborhood. In some areas, the median sale price is down but in an adjoining neighborhood may be up substantially.
- The Park City market has been and will continue to be highly segmented, with each neighborhood having unique values and unique pricing trends. Even within one neighborhood, prices may vary widely based on many factors. Hyper-local knowledge is becoming more important to the buying (and selling) process.
Comparing Market Segments year over year:
| Thru Q3-2022 | Thru Q3-2023 | Changes Year over Year | ||||
| Units | Volume | Units | Volume | Units | Volume | |
| SFH | 1,238 | 2,746,277,844 | 942 | 2,162,418,509 | -24% | -21% |
| Condo | 1,200 | 1,651,206,363 | 797 | 1,147,414,360 | -34% | -31% |
| Land | 903 | 885,759,665 | 399 | 441,504,361 | -56% | -50% |
| TOTAL | 3,341 | 5,283,243,872 | 2,138 | 3,751,337,230 | -36% | -29% |
| Res Combo | 2,438 | 4,397,484,207 | 1,739 | 3,309,832,869 | -29% | -25% |
Despite all the declines in unit and volume of the most recent 12 months compared to the previous period, if we look at 3rd Quarter numbers compared to prior years, the report is optimistic. Although total sales in Q3-23 are markedly below the same quarter in either 2021 or 2022, they are only slightly lower than the average of the “normal” period from 2013 to 2019. (Charts and observations courtesy of Rick Klein.)
The Park City market continues to appreciate as sale prices continue what has been a 10 year ascent ever higher.
Looking at combined residential sales, the chart at the right shows the steady rise in prices since the market downturn from 2008 to 2011. The increase from 2021 to 2023 was about 24%, significantly higher than our historic norm of 6.8% annual growth. In the most recent 12 months, the increases have been barely one-quarter of that rate, 6.6%. This is much closer to our usual or “normal” rate of appreciation. Real estate in the Wasatch Back looks like a very strong investment over the long run with no signs of slowing down.
What are the key takeaways from this quarter’s numbers?
- Demand is increasing. In Q3-2023 619 residential properties were put under contract. That’s up from 557 (11% from Q3 2022 but still down slightly (17%) from the pre-pandemic “normal” (Q3-2019) of 753.
- Inventory has improved significantly but remains 20% less than average pre-pandemic levels.
- In Greater Park City, residential price gains have leveled off and are relatively unchanged from a year ago.
- With the roller coaster effects of the pandemic behind us, the greater Park City area is seeing a new normal, with the market settling into a stable, predictable period of steady growth.
Real estate in the Wasatch back consists of highly segmented markets with nuances that vary significantly from one neighborhood to another and one house to another. Comparisons are hard to read on paper due to the unique features of individual properties, such as amenities, condition, style, location, age, view, and inventory. Buyers and Sellers are advised to contact a local Park City Board of REALTORS® Professional for the most accurate, detailed, and current information.