Housing prices are on the rise in ski regions across North America, and recreational property is one of the hottest investments out there right now.
“Despite travel restrictions, prices have continued to climb for recreational property in a ski resort. Last year prices grew on average by 5.1 percent. A report from Realtor.com shows that views of ski-town homes were 72% in 2021, while it was 36% in 2020. Particularly the North American ski resorts are hot in demand. Prime property prices of Aspen stand at around US$33,300 per square meter while Vail ski resorts stand at US$28,200.,” comments Kimo Quance from The Kimo Quance Group.
According to real estate broker Robert Fischer from the Robert J Fischer Team, “In 2020-21 U.S. ski resorts enjoyed the fifth-highest number of visits since 1978-79 when the National Ski Areas association started tracking the participation. Almost 10.5 million people skied in the U.S during the season, which is the highest to date on the record. From the western ski towns to the Aspen area to the north-east, this trend has been seen to boom across most of the ski areas in the U.S.”
Demand for houses in popular ski areas has increased rapidly worldwide, with low inventory levels putting upward pressure on prices in these areas as more and more people leave the big cities for a more active lifestyle on the slopes.
Inventory, or lack of it, is the leading cause for rising home prices in ski resorts. “The recent Royal LePage report shows that, in Canada’s ski regions, year-over-year home price appreciation has skyrocketed since the beginning of 2021. This is driven by strong demand amidst low supply, and it has spilled over into other parts of our country too-the median single-family detached homes increased 23% to$791k,” says Christopher Brown from Next Real Estate Group.
In addition to rising home values, you can also expect increased rental income from the recreational property. Recreational home rental prices are on the rise in popular ski destinations, and many ski resorts in Colorado face a housing shortage which is driving up rental accommodation prices.
Ski resorts within driving distance from big cities are seeing a sharp rise in short-term or nightly rentals, and those recreational property owners are reaping the benefits.
“Investing in short-term rentals just outside your city can be a smart move, too,” comments Brad from Insurance Geek. “According to recent data from Airbnb, close-to-home getaways are reigning supreme these days, so think of ways you can offer local travelers some much-needed R&R or socially distanced entertainment.”
Ski Resorts See a Rise in New Construction
One of the main reasons recreational property is so popular right now is that many ski towns are seeing a shortage of housing supply, driving up prices for existing inventory while increasing demand from buyers looking to purchase second homes.
Real estate developers are responding to the high demand for recreational property in ski resorts, and in some cases, they are building recreational properties for the primary market. For example, at Sun Peaks Resort, located just 40 minutes from Kamloops in the interior of British Columbia, the launch of the new ski-in, ski-out development “Altitude” sold out during the first weekend of sales, says local realtor Andrew Karpiak of Kamloopsliving.com.
Low-interest rates are another factor for driving up recreational property values. Low-interest rates have made it easier for buyers to afford a recreational property, contributing to increased demand.
“When you combine low-interest rates with increasing demand, it’s easy to see why recreational property is so popular right now. This means there are some great opportunities out there for recreational buyers looking at second homes or investment properties with strong capital appreciation potential,” added Karpiak.
There has also been a significant increase in demand from recreational buyers who want luxury second homes, driving up the prices of existing inventory and creating new opportunities for homebuilders.
“The North American ski resort of Aspen has recently seen a sharp rise in demand and sales for homes. Now that this resort has reopened after a long lockdown period, its transaction volume has risen considerably over the past few months,” says Ben Wagner, a real estate investor from Leave The Key.
“In Aspen, the average price per square foot of an Aspen luxury property was $2696 in 2020. In the last year, it jumped to $3203. This signals an increase of over 20%,” added Wagner.
The recreational property boom across ski resorts attributes the rising house prices, which have outpaced the traditional housing market by almost double. With recreational property, you get more for your money while still enjoying a beautiful lifestyle on the slopes of North America’s most popular ski resorts.
People Are Trading Big Cities for the Ski Slopes
With the advent of telecommuting and working remotely, many people can now live wherever they want. And what could be better than living in a ski resort town?
The recreational property boom has seen many people trading in their homes in big cities for recreational properties. So it’s no surprise that so many people are looking outside of the city; they see this as an opportunity to trade their downtown condo for a recreational property somewhere more scenic.
One of the most desirable skiing destinations in the West is Park City. According to the University of Utah’s Kem C. Gardner Policy Institute, in 2021, Park City witnessed a 43.5 percent rise in median sales prices from $801,274 in 2020 to $1.15 million.
People can sell their homes in big cities for big profits and purchase recreational property for far less, putting the rest of the money in the bank. Having the added benefits of walking out the door and hitting the ski run instead of commuting and sitting in traffic is drawing more and more people out of the big cities and into areas with an attractive outdoor lifestyle. The only requirement is an internet connection.
Ski Resorts Offer Year-Round Activities
Skiing is carried out outdoors, at a safe distance from the presence of others, making it a relatively safe pastime during a pandemic. In addition, many of these locations provide year-round outdoor activities, making them ideal destinations for residents throughout the summer.
Sun Peaks Resort has a large percentage of year-round residents and offers many different things to do in Sun Peaks that don’t involve just skiing or snowboarding. It is a four-season ski resort with a thriving mountain biking scene and 18 hole golf course to offer during the summer.
Ski resorts like Aspen offer summer activities that may be more appealing than the winter options. In Aspen, outdoorsy activities on offer through the summer include paragliding, hiking, river rafting, and mountain biking. There is also the Aspen Music Festival which runs for eight weeks, and the culinary delights found at this ski town draw many foodies from around the globe.
With popular tv shows like Yellowstone showcasing a luxury lifestyle away from the big city, people are taking notice. Teton Pass Ski Resort in Choteau, Montana, is close to many outdoor destinations such as Glacier and Yellowstone National Parks.
As a result, real estate in Choteau has seen a significant boost in realtor.com views. “Americans are increasingly searching for getaways that are within driving distance,” says realtor.com chief economist Danielle Hale.
“For those who can continue to work from home indefinitely, ‘home’ can be just about anywhere in the country with a decent Wi-Fi connection, including at the base of a mountain,” said Phil Soper, president, and CEO, Royal LePage.
“Despite the easing of travel restrictions and the reopening of some international borders, the global pandemic, which confined millions of people to their own homes in 2020, remains a real concern. As such, many Canadians are choosing to take advantage of local recreational markets over traveling abroad.”
There does not appear to be an end to this real estate boom in ski resorts in North America in the short term. The recreational property values will only continue to rise as more and more people discover the benefits of living in these towns. So, if you have been thinking about buying recreational property, now may be the time to do so.
By: Associated Press I The National Herald I February 13, 2022