Basin: a buyer’s market
October 10, 2008
Houses at the gated Promontory subdivision have been selling for close to half price.
"Homes that were valued at $4 million sold for $2 million," Summit County Commissioner Ken Woolstenhulme claimed Wednesday at the weekly commission meeting in Coalville.
Officials might reexamine property at Promontory to determine if the value should be lowered for reasons related to property taxes, he explained.
"They’re going to have to go back and reassess all those properties," Woolstenhulme said.
That could mean less property-tax revenue for county services, and a tax hike, he lamented.
But Promontory Managing Director Rich Sonntag said real estate in Park City has always been a bargain when compared with other mountain towns.
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"Park City is on the radar screen of great mountain destinations," Sonntag said in a telephone interview Thursday. "The market is a little slow now so they’re selling at a price that doesn’t have as much profit built into it as when the market was hot. There are several good opportunities like that out here."
Still, Summit County is feeling effects of a slumping national economy, Woolstenhulme said.
"I don’t think that we’re going to get away scot-free when the rest of the country is going the way it’s going," Woolstenhulme said about slipping housing and financial markets. "I just hope that we don’t stick our heads in the sand and hope that this thing just passes over."
The owners of older homes in Park City are demanding their property be reassessed because a moratorium on demolishing historic buildings has lowered their property value, Woolstenhulme said.
"This is going to impact the county," he said.
Summit County Commissioner Bob Richer acknowledges that local real-estate markets have seen "depressed sales."
"The market is going to adjust down," Richer explained.
Department heads in Summit County were asked how they might cut 20 percent from their budgets to respond to worst-case scenarios, if need be.
"We certainly need to be cautious," Richer said.
Meanwhile, Richer said sales-tax revenue could diminish if fewer people travel to Summit County where tourism and real estate drive the economy.
"It’s not that we’re in a downturn. We’re just not increasing at the levels that we were increasing," Summit County Commissioner Sally Elliott said about visitor tallies.
Richer, who sold real estate in Park City in the 1980s, advertised the sale of the county’s first million-dollar property then.
But bankruptcies and foreclosures ran rampant.
"Every other house in Prospector was for sale," Elliott said about when she moved to Park City in the depressed mid-’80s. "There were very few full-time permanent neighbors there."
Today some buyers pay cash and they rarely need subprime loans to finance expensive home purchases, Richer said.
"We will be in better shape than other parts of the country," Elliott said.
Homebuilders also are not as leveraged financially as they were in the ’80s in Park City, Richer said.
"The market sales are soft but you haven’t seen in this market as a whole the kind of price reductions you have seen in other mountain communities because our pricing was better to begin with," Sonntag said.