Click here for the 10 year overall graph

Welcome to the 15th Anniversary of The Hole Report. Published semi-annually, this data-driven report is the most accurate and trusted real estate news source in Teton County, Wyoming. First, we would like to thank all our loyal readers (customers and clients) for their continued trust in this report. Our ability to track every single real estate transaction, and then turn the data into historical knowledge, has made us the most sought after real estate experts in Jackson Hole. We have taken this historic opportunity to not only revamp the look of our semi-annual newsletter but to also introduce two new segments to the report; commercial real estate and foreclosure/distressed properties.

THE MARKET HAS HIT BOTTOM: What exactly does this mean? For starters, a bottom does not mean that prices are about to return to the heady days of 2007. It just means that the trend is no longer getting worse, which is the critical factor. Overall, it can be opined that the Jackson Hole market has reached a bottom and is experiencing a stabilization of prices. The following statistics are signaling the bottom: 1.) Three quarters of increasing number of sales, 2.) Two quarters of decreasing inventory (down 34% since June 2009), and 3.) Three quarters of increased properties under contract at the end of each quarter. Click here for the overall market review by quarter

How long will we sit at the bottom? This is difficult to predict, as the bottom is very soggy right now. While recent distressed properties (foreclosures, short sales and REO’s) have surfaced in 2009, they only accounted for 6% of the sales in 2009. Many foreclosures were not resolved at auction and their respective lenders took over the property. These properties (30+) will be returning to the market after the standard 90-day redemption period. Based on REO’s sold in 2009, these properties will hit the market at well below current values, removing them from lenders’ books quickly. The other factor coming into play is the overpriced listings currently on the market. Unfortunately, many of today’s Sellers refuse to lower their prices. It is estimated that 40% to 50% of the current inventory is overpriced. This stubbornness, unless reversed, will surely keep Buyers from engaging in offers. With few exceptions, one thing is for sure; no property in Jackson Hole today is worth what it was in 2007.

Advice to Sellers: Postpone selling if you can. Wait, if you’re able, until you see clear, modest upward trends. Then move…and don’t be greedy. If you must sell right now, ask your Realtor what they think your property is worth under a cold, hard light, but be prepared to move down as fast as you have to in order to remain competitive. Sell “as is.” Be transparent about your need to sell and don’t send mixed signals. You’ll find out the current market value of your property quickly.

Advice to Buyers: Figure out what a particular property is worth to you right now considering your top parameters and goals. Forget about timing the market and buying at the bottom, as there are exceptions to all trends. Come up with an offer that makes sense to you, regardless of asking price, comparables, appraisals, competitive market analyses and the unsolicited advice of your overly opinionated brother in-law in Florida.

Bottoming out will require adjusting the expectations of have-to-sell-now sellers in this real estate market. This will surely bring more pain. It's also vital to reset expectations of appreciation. Yes, appreciation will return. No, we will not see double-digit annual appreciation like we did during the last several years. If you would like to know your property’s value in today’s market go to the contact page and send your request.

It’s the bottoming of expectations, one Seller at a time, which will bring us out of the current market.

*NEW - COMMERCIAL REAL ESTATE SEGMENT: Over the past 15 years we have only touched on the commercial side of our real estate market in this newsletter. With the addition of our newest commercial Broker (Michael Pruett) and the input from our commercial appraisers and other Brokers we will now be able to report confidently on every segment of our local market. As we look to the future and the expansion of our commercial real estate efforts, there was no other agent in the valley that offered the successful track record and business acumen that Michael Pruett brings to JHRE Associates. He will be a valued addition to the company and it is a pleasure to have him on board.

*NEW - DISTRESSED REAL ESTATE (FORECLOSURES, SHORT SALES & REO): Everyone has heard these buzzwords and the majority of Buyers want to focus solely on these types of properties. As part of our continued efforts to stay on top of market trends, we have started offering weekly email updates of all upcoming foreclosures. We are also tracking short sales and bank owned properties. If you would like to sign up for weekly update go to the contact page and send your request.

What is distressed real estate? It is a property that has to be sold in order to pay arrears on a mortgage. There are three types of distressed real estate: foreclosures, short sales and REO’s.

What is foreclosure? Foreclosure is a legal proceeding to terminate a borrower’s interest in real property, instituted by the lender, to either gain title to the property or force a sale in order to satisfy the unpaid debt secured by the property.

What is a short sale? A short sale is when the proceeds from the sale of real estate fall “short” of the balance on the loan. The lender agrees to accept less than the amount due on the loan due to financial hardship on the part of the borrower. Generally, lenders won’t discuss short sale requests unless the borrower is already far behind on mortgage payments.

What is a REO? The property is owned by a lender, most often a bank, and after a failed attempt at selling the property at an auction, it is returned back to the bank. After the 90-day redemption period in Wyoming the bank will most likely place it on the open market, normally below market value to get it off their books quickly.

NOTE: If you are out looking for these distressed properties you should consider the following; in 2009 only 6% of the overall sales were distressed. Of the 539 currently available listings only 4.8% are considered distressed. Buyers need to also understand a distressed sale requires lots of patience, as the average time spent to close is between 90-120 days. Don’t let the allure of a distressed property blind you from the other opportunities. The current number of motivated Sellers is historic, as are the low interest rates. While distressed sales usually generate lots of interest and offers, the non-distressed properties are getting little attention yet many Sellers are ready to negotiate.

CRUNCHING THE NUMBERS FOR 2009: The overall market (all home, lot, condo and commercial transactions or listings) mirrored last year’s largest decrease in number of sales (down by 47%) which was the largest in recent history. However, looking at the last three quarters it appears we have bottomed out on the overall number of sales. Overall dollar volume was down 54% for the second year in a row (totaling $333 million), and the average sale price was down 13%. The upper-end market (over $2 million) also mirrored last years largest decrease in number of sales over $2 million, down 56%. Of the 44 sales, 19 came in between $2 to $3 million, with 25 over $3 million and 10 selling for over $5 million.

OVERALL REAL ESTATE CURRENTLY UNDER CONTRACT is showing positive signs. The number of properties currently under contract is up 51% when compared to the end of 2008. The dollar volume, average list prices and median list prices under contract are down though, 8%, 57% and 53%, respectively, when compared to year’s end 2008. The decreases in the average and median prices reflect a shift in what price points are selling. Out of the 55 properties currently under contract, more than half are listed for under $2 million. NOTE: As of January 1st there were no single family vacant land listings under contract.

CURRENT OVERALL AVAILABLE INVENTORY has only increased 4% when compared to the end of 2008, but has dropped 34% since June 2009 to 550 overall listings. Note: This drop did not necessarily come from sales in 2009, instead from frustrated Sellers who took their property off the market because they refuse to sell at today’s market values. Don’t expect those frustrated Sellers to re-enter the market anytime soon, as it will take time before we return to peak values of 2007. Meanwhile, the overall average listing price was almost unchanged when compared to 2008, down 1% to $2.66 million. The dollar volume of available properties, as of January 1st, was up 3% to $1.463 billion when compared to this same time period in 2008.

Jackson Hole Real Estate Associates LLC is the largest locally owned and operated Real Estate Company in the region. Our team is comprised of 60+ agents, appraisers and support staff, as well as a powerful database that leverages information for our clients who like to keep track of every single real estate transaction in Jackson Hole on a daily basis. Combine all this with the worldwide reach of Christie's Great Estates, the simple fact remains: “We Know the Market Better than Anyone”.

It is becoming very clear that Buyers and sellers demand to stay informed of market conditions. We offer several services that will keep your finger on the pulse of our local real estate market, from daily email updates, a free market analysis of your property, to quarterly price updates on your Jackson Hole property. We have recently added a weekly foreclosure update that you can also subscribe to via email. Please contact us to learn more about the programs and services we can provide.

Today the Christie's Great Estates global network of affiliated brokers includes nearly 36,000 sales associates operating from 900 offices in more than 40 countries. The network's combined annual sales topped $128 billion. The combined global networks of Christie's and Christie's Great Estates, both market leaders in the sale of luxury goods, create a world-class showcase for distinguished real estate. No other network offers this level of international visibility to proven Buyers of high-value property.

Whether you are pricing your property to sell in this competitive market, or deciding when the right time to buy is; rest assured that when you are our client, you will have current market statistics, an impeccable level of service and personal attention that will give you the upper hand. For a free comparative market analysis please go to the contact page and send your request.

The Hole Report is published semi-annually, with additional email updates for the first and third quarters. While others attempt to report on our market with MLS statistics only (MLS historically tracks 65-70% of the market) we track every single transaction in Teton County. This data-driven report is the most accurate and trusted real estate news source in Teton County, Wyoming. If you would like to sign up for these quarterly email updates, or need more detailed information about our market, feel free to either call 307-734-9941 or go to the contact page and send your request. You can also find “The Hole Report” on Facebook.

We hope this report has given you a snapshot of market trends and, as always, we would be glad to discuss them further with you. If you plan to list your property this spring, would like a more detailed analysis of specific areas, back issues of THE HOLE REPORT, or a professional Realtor to represent you in your next real estate transaction, please call or email one of the numbers below or write to P.O. Box 4897, Jackson, WY 83001, Attn: David and Devon Viehman.

Sincerely,

David E. Viehman, Owner/Broker, Editor
Devon Viehman-Wheeldon, Owner/Sales Associate, Co-Editor
Jackson Hole Real Estate Associates LLC
davidviehman@jhreassociates.com
www.jacksonholereport.com
Direct: 307-734-9941
Toll-free: 888-733-6060 ext. 9941

*While other local Real Estate Brokerages attempt to report on the local real estate market, Jackson Hole Real Estate Associates LLC is the only company to track every single transaction. Therefore, if you want the most accurate information to help guide you through your next real estate transaction, call us today. “We are the Experts”.

*All statistics are supplied by sources that have been deemed reliable but are not guaranteed.

*All statistics quoted in this newsletter are based on sales in 2008 compared to sales in 2009.

*Median sale price is the cost of a property that has an equal number of sales above and below it on the price scale.

*Average sale price is the total combined dollar volume divided by the number of sales.

*The word “Overall” in this newsletter refers to all sales in Teton County combined (homes, lots, condos, commercial and ranch).

*The term “Market Value” means; the value of a property in terms of what it can be sold for on the open market; current value.

© Copyright 1995 - 2010 by David E. Viehman and Devon Viehman-Wheeldon dba Jackson Hole Real Estate Associates LLC. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means without explicitly written permission from David E. Viehman.

This site will be updated again on July 30, 2010

DATA-DRIVEN REPORT FOR THE FIRST SIX MONTHS OF 2009

The Perfect Buyers’ Market: Conventional wisdom would say the Perfect Buyers’ Market occurs right after the market bottoms out.   The problem with this scenario is three fold.  One, it takes six months after the market truly hits bottom to actually verify.  Two, once the market truly hits bottom Sellers lose their motivation and start raising their price, trying to recapture all the equity they can.  Three, every other Buyer starts bidding.

Contrary to popular belief the following is what actually makes the Perfect Buyers’ Market.  NOTE: The Jackson Hole real estate market has never seen all of the following components at the same time:

• Demand is at an all-time low: The number of overall sales is down 73% when compared to the same period in 2008.  In fact, the last time Jackson Hole recorded so few sales, in the first six months of the year, was back in 1984.

• Interest Rates are at an all-time low: The interest rates being offered today haven’t been this low since the late 1960’s.  While lending guidelines have tightened in the past 18 months, there are excellent loan opportunities for Buyers with good credit.  In fact, first time home buyers can work with the FHA or VA to qualify for low down payments and may qualify for as much as an $8,000 tax credit.  Jumbo loan limits are higher in Jackson Hole.  This means you can now borrowup to $693,750and still be considered low risk.  The end result with low interest rates and higher limits; increased buying power for locals!

• Inventory levels are high: Jackson Hole inventory is up 42% when compared to the same period in 2008.  Look back just two years though, to 2007, and the current inventory is up 123% (371 versus 827 properties on the market).  In fact, the last time inventory levels were this high was back in 1999.

• Motivated Sellers: (Any seller with a strong incentive to make a deal): While it’s impossible to guess just how many motivated Sellers there are, one thing is for sure, the number is growing.  Some need to sell to survive the recession; some want to take advantage of another real estate market, where properties are being sold for way below replacement cost; others need to sell for personal or family reasons.

• Property values have dropped to 2004-05 levels: While a large percentage of the current inventory is still priced close to the all-time high (fall 2007), the properties selling are priced at 2004-05 levels.  NOTE: Jackson Hole has not seen an across the board reduction in real estate prices since 1985.

According to Christie's Great Estates, savvy buyers are recognizing opportunities in this challenging economic climate by acquiring real estate while prices are at historic lows and inventories are high. "I believe people will look back on 2009 and regret not buying real estate," says Kay Coughlin, President & CEO. "Trophy estates are being offered for sale, some of which have not been on the market for generations.  Prevailing economic forces are creating a value proposition for qualified homebuyers that will not be available for long."

First time homebuyers: There has never been such a Perfect Buyers’ Market for first time homebuyers.  Low interest rates, increasing inventory of affordable housing, motivated Sellers and an $8,000 tax credit.  If you can’t afford the down payment ask your parents to help, or make them a partner in the investment.  You can also form a partnership with one or more friends.  The bottom line is doing whatever is needed to take advantage of this Perfect Buyers’ Market.

The overall market has been hit hard by the national recession.  Number of sales and dollar volume are both down 73% when compared to July 1, 2008.  Looking back just two years to 2007, the number of sales is down 85% when compared to 2009.  The hardest hit by this downturn is the under $1 million segment (local’s market) where the mortgage crisis and national recession have really been felt.  The upper end market has also seen a huge slow down, though recent showing activity has increased.

Overall available inventory continues to climb, up 42% when compared to July 1, 2008. Looking back just two years to 2007, the overall inventory is up 123% (371 vs. 827) when compared to 2009.  This dramatic increase in inventory can be directly associated to the national recession and is helping to fuel the Perfect Buyers’ Market.  The largest increase in inventory is the $1 to $2 million-price range.  NOTE: According to the National Association of Realtors (NAR) the average amount of available inventory nationwide is 9.7% versus 6.9% of the total inventory in Jackson Hole, as of July 1, 2009.
   
Overall properties under contract is also lending credence to the Perfect Buyers’ Market.  The number of properties under contract is down 53%, the dollar volume under contract is down 71%, and the average list price under contract is down 37%.  The upper end market is also experiencing a downturn.  The $1 to $3 million price range has 36% fewer properties under contract; $3 to $5 million has 85% fewer properties under contract; and the $5+ million price range has 70% fewer properties under contract, when compared to July 1, 2008.   NOTE: Historically, we see more upper end sales activity between August and October.

"Face reality as it is, not as it was or as you wish it to be.”  Jack Welch.

From the Appraisal Department: Over the past year, the appraisal business has also been greatly affected by the downturn in the national economy. The biggest change has been the Home Valuation Code of Conduct (HVCC), which was pushed through congress largely by the efforts of New York Attorney General Andrew Cuomo as part of a lawsuit with then Washington Mutual. The new law prohibits real estate agents or mortgage brokers from hiring appraisers directly. The lenders can use an inhouse appraiser or can outsource to an appraisal management company to engage appraisers for assignments. This law wants to break relationships between lenders and appraisers as some feel these relationships became too friendly and some appraisers would sign off on inflated valuations just to keep the relationship and thereby more business. So, what do these changes mean to appraisal customers? In terms of valuations, nothing: the market is what the market is, but with a middle man in the mix it most likely will mean higher appraisal fees and longer process times.

In terms of local market valuations, the biggest difficulty appraisers encounter is the lack of applicable data (or recent sales). With the number of sales way down there is less data out there for appraisers to extract information. Therefore, the appraisers are going back in time or out of the neighborhood to find data.  This can cause excessive adjustments which underwriters and banks dislike.  So even if a value may justify a sale price the banks still may not be willing to lend on the property because the adjustments exceed an indicated amount, the comparable sales are not located within a specified distance of a subject property, or the sale may have occurred beyond a specified time period. In the end, it continues to be a bumpy ride for the appraisers and lenders alike. 

The one thing that appraisal customers can rely on, is that the staff at Jackson Hole Real Estate Associates has the knowledge and experience for all your valuation needs during these difficult times. Tom Ogle, General Certified Appraiser – Jackson Hole Real Estate Associates, LLC

Jackson Hole Real Estate Associates LLC is the largest locally owned and operated Real Estate Company in the region.  Our team is comprised of 70+ agents, appraisers and support staff, as well as, a powerful database that leverages information for our clients, daily tracking of every single real estate transaction in Jackson Hole. Combine all this with the worldwide reach of Christie's Great Estates, the simple fact remains: We Know the Market Better than Anyone.

It is becoming very clear that buyers and sellers demand to stay informed of market conditions. We offer several services that will keep your finger on the pulse of our local real estate market, from daily email updates, a free market analysis of your property, to quarterly price updates on your Jackson Hole property. Please contact us to learn more about the programs and services we can provide. 

Today the Christie's Great Estates global network of affiliated brokers includes nearly 36,000 sales associates operating from 900 offices in more than 40 countries. The network's combined annual sales topped $128 billion. The combined global networks of Christie's and Christie's Great Estates, both market leaders in the sale of luxury goods, create a world-class showcase for distinguished real estate. No other network offers this level of international visibility to proven buyers of high-value property.

Whether you are pricing your property to sell in this competitive market, or deciding when the right time to buy is; rest assured that when you are our client, you will have current market statistics, impeccable level of service and personal attention that will give you the upper hand.

We hope this report has given you a snapshot of market trends and, as always, we would be glad to discuss them further with you.  If you plan to list your property this fall, would like a more detailed analysis of specific areas, back issues of The Hole Report, or a professional Realtor to represent you in your next real estate transaction, please call or email one of the numbers below or write to P.O. Box 4897, Jackson, WY 83001, Attn: David and Devon Viehman.

Sincerely,

David E. Viehman - Owner/Editor, Associate Broker
Devon Viehman – Owner/Editor, Sales Associate
888-733-6060 or 307-734-9941 x 111
davidviehman@jhreassociates.com or devonviehman@jhreassociates.com
www.jacksonholereport.com
www.jhreassociates.com



Copyright 1995 - 2009 by David & Devon Viehman, dba Jackson Hole Real Estate Associates, LLC. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means without explicit written permission from David or Devon Viehman.

* This report does not go into detail on every segment of the market, but is intended to offer an overview of general market conditions, changes in number of transactions and average sales prices. The values of individual properties will most likely vary from these graphs.

*All statistics are supplied by sources that have been deemed reliable but are not guaranteed.

*All statistics quoted in this newsletter are based on sales in the first six months of 2008 compared to the first six months of 2009.

*Median sale price is the cost of a property that has an equal number of sales above and below it on the price scale.
*Average sale price is the total combined dollar volume divided by the number of sales.

*The word “Overall” in this newsletter refers to all sales in Teton County combined (homes, lots, condos, commercial and ranch).