POSTED: 2:16 pm MDT September 4, 2006
ASPEN, Colo. — Even veteran real estate agents used to Aspen’s stratospheric property prices find the latest trend amazing: up to 60 percent appreciation on several homes and condos in less than a year.
"On certain properties there has been enormous escalation in value," said Ernie Fyrwald, owner of Morris and Fyrwald Real Estate. "Sometime it’s very astounding. It’s not the case across the board, but there are quite a few.
"It has a lot to do with lack of inventory," Fyrwald said.
A four-bedroom, 6,482-square-foot house was bought for $5.3 million in May 2005, expanded to six bedrooms and sold again in January for $8.6 million.
Three $20 million properties sold or were put under contract last month.
Values have increased when properties are "flipped," when someone buys a house or condo, renovates it and sells it quickly at a net gain.
The value of a condominium under contract jumped 19 percent in four months. It sold for $1.385 million in March and was relisted in July at $1.65 million.
There are no signs in Aspen of an evening out of the housing market occurring in some parts of the country.
"There can be a point where people aren’t willing to pay the number, but we haven’t seen it," Fyrwald said.
Real estate broker Tim Estin said he believes the hot prices are due to the perception that Aspen is a safe market. The town’s natural and cultural amenities drive demand and slow-growth policies and restrictive zoning keep supply in check.
But experts said property that looks like a sure bet for appreciation might not turn out that way.
"There’s a perception that the real estate community knocks off $20 million home sales every day," said BJ Adams, owner of BJ Adams and Co. Real Estate. "The truth is that there have been few of those sales in Aspen’s history."
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