Ski area properties at the base of Jackson Hole Mountain Resort enjoy another big year despite COVID, rollercoaster visitation.
One year ago, in my annual look at the Teton Village real estate market, I highlighted the phenomenal growth in inventory and values during the previous 10 years. We also discussed the likelihood of values continuing to rise due to a forecast of shrinking inventories.
As the calendar flips into 2021, it’s quiet in Teton Village. Too quiet for those more accustomed to a higher volume of skiers and hotel occupancy, perhaps, but the usual buzz is more of a low hum these days in terms of visitors and real estate sales.
Jackson Hole Mountain Resort has “established a maximum daily capacity for guests and will limit the number of tickets available for purchase each day to enable sufficient physical distancing.” Limited lift ticket availability has resulted in significantly decreased occupancy rates in Teton Village core lodging properties such as Hotel Terra and Four Seasons.
At least that’s how it looks at first glance. According to internal Jackson Hole Sotheby’s research, unit sales in Teton Village rose by 10 percent in 2020 compared to 2019. While this shows solid growth, it lags far behind other corners of Jackson Hole such as near the Jackson Hole Airport (north of town) and the greater Wilson area (West of Snake River, but not Teton Village), which saw unit sales jumps of 89 and 56 percent respectively. The South of Town region (Melody Ranch, Rafter J, South Park, 3 Creek Ranch) saw a 50 percent increase in unit sales.
In reality, “Don’t tell me this town ain’t got no heart, you just gotta poke around.” Despite the low inventory, which translated into restrained unit sales totaling 54, the dollar volume soared in Teton Village by 98.7 percent for a sum of $232 million. That’s an average sales price of $4.3 million for all residential sales.
In other words, buyers looking to get a foot in the door of the Teton Village real estate market looked primarily to single-family homes in Granite Ridge, Shooting Star and the South Village. Demand was high for South Village condos, typically built in the 1970s and a traditional entry point for Teton Village buyers, but owners of these properties sat tight in 2020.
Let’s look more closely at sales and current inventory for various property types.
Teton Village single-family homes
In 2020 there were 19 single-family homes sold with an average sales price of $6.3 million, or $1,366 per square foot. The least-expensive sale was $3.495 million for a 3,212-square-foot home built in 1989 and the top sale was a $15.95 million home with 7 beds and 10,500 feet built in 1988. There also are two pending single-family homes priced at $15.6 million and $8.95 million.
There are currently four single-family homes listed in Teton Village priced between $6.7 million and $11.95 million for a 8,490-square-foot home yet to be built.
Looking ahead, buyers will continue to have two main options when it comes to single-family homes in Teton Village, which are represented perfectly by the two active listings above: the home priced at $6.7 million was built in 1978 on a .6-acre South Village lot and will most likely be completely remodeled or removed to make room for a new build; the highest-priced active listing is new construction on one of the handful of undeveloped lots in all of Teton Village outside of Shooting Star.
What has changed in the last year is that the redevelopment candidates have increased in value from about $3.5 million to more like $5 million.
Teton Village condo-tels
Teton Village includes four condo-tel (condominium properties that operate as a hotel) properties including Hotel Terra, Teton Mountain Lodge, Four Seasons in Jackson Hole and Snake River Lodge & Spa. The latter two properties also include hotel rooms not individually owned.
There were 6 condo-tel sales in 2020 with 4 in Hotel Terra, 1 in Teton Mountain Lodge and the last one in Snake River Lodge & Spa. These sales ranged from $982,500 for a 1-bed, 932-square-foot Hotel Terra unit to $1.595 million for a TML unit with a little more than 1,000 square feet.
In contrast with the broader Teton Village and greater Jackson Hole market, condo-tel units saw almost no gain in value with price per square foot rising about 3 percent and sales plummeting from 15 to 6. The relative flatness of this micro-market may be the result of three dynamics unique to 2020:
- COVID-19 restricting travel in late winter and spring;
- erratic rental incomes that spiked in Q3;
- Condo-tels have owner usage limitations so do not work as a second home or full-time residence; therefore these units were not of interest to buyers seeking to relocate away from more urban environments.
Because of COVID-19, the second quarter reported relatively small rental income. However, by the start of summer and the third quarter, much of the country began traveling again and Jackson Hole was inundated with visitors, but rooms accessed by elevator were less in favor than rental properties with exterior entrances.
Then, during the Christmas/New Year’s period, when rents are usually the highest all year and occupancy is 100 percent, the lack of available lift tickets reduced occupancy to 75 percent in Hotel Terra and below 50 percent at Four Seasons in Jackson Hole.
Further depressing rental income was the decision by many owners to use their condo-tel units for extended stays instead of making it available for rent.
Currently there are 7 condo-tel properties actively listed, including 2 in Four Seasons, 4 in Hotel Terra and 1 in Teton Mountain Lodge, ranging in price for $549,000 for a TML studio with 441 square feet to a 3-bed, 3,826-square-foot slopeside Four Seasons in Jackson Hole condo priced at $12.5 million.
“Old” Village condominiums
Crickets. That’s the sound of market activity for condominiums on Rachel Way and Michael Drive, where there are more than 300 such units built in the 70s and early 80s.
Current active listings: zero. Current pending listings: zero. Total sales in 2020: five. Pent-up demand for Old Village condos: as my clients working with me to identify options in this micro-market will concur, immense.
Traditionally, this market has been a very vibrant entry-level Teton Village micro-market with multiple sales per year as owners either moved up to a larger, newer unit or cashed out to make way for the next wave of owners. There were 19 such sales in 2019, ranging from about $540,000 to about $1.2 million.
Why the dearth of activity for Old Village condos? Well, for one there is less opportunity to trade up as similar, but larger/upgraded, inventory lags. Also, these units offer the full range of ownership options, from nightly rental to long-term rental to owner occupancy without limits (as opposed to condo-tels), and are in very high demand from visitors looking to house themselves away from hotels/elevators/lobbies. Given the choice between holding an income property with strong returns with the option of living in it themselves, and parachuting out of the Jackson Hole real estate market, owners are sitting tight.
Teton Village building sites
Available building sites are few and far between in Teton Village, and activity in this segment reflects that with just 1 active listing on market, 1 pending and 5 sales in the last 12 months. There have been just 10 reported sales in the last three years.
Of the 120 single-family home sites in Old Village (platted in the 1960s), a scan of the county GIS information shows14 remain undeveloped. However, these are almost all owned in addition to an adjacent developed lot and purchased and/or held to enhance privacy and value.
In January 2018, one of the last available building sites with direct access to the Mountain Resort in all of Teton Village was listed for $3.35 million by a family that had owned it since the 1960s. The property received multiple offers and closed for several hundred thousand dollars above asking price. The initial investment in the property was less than $50,000 and included a lifetime pass to Jackson Hole Mountain Resort.
Shooting Star, which was platted in 2008 and includes approximately 100 single-family building sites, also is reaching capacity. The developer has sold all lots and the market for resales has been stagnant. Developed lots now easily outnumber vacant lots.
Two Shooting Star lots sold in 2020, including a 1.42-acre lot listed for $5.3 million and a 1.32-acre lot listed for $5.5 million. In the Old Village a .9-acre site not on the ski slopes sold that was listed for $2.8 million.
As a member of the Hotel Terra and Teton Mountain Lodge sales team, and a 30-year passholder at Jackson Hole Mountain Resort, I have my finger on the pulse of Teton Village real estate.
My files include extensive information on Teton Village properties including sales histories, floor plans, CCRs, rental management agreements and much more.
I believe in the Theory of Realestativity: Market Knowledge = Smart Money. Let me know when you are ready to take your understanding of the Teton Village real estate market to new heights in pursuit of your goals.
“This is for informational purposes only and is not a solicitation for business. If you are currently working with a Realtor, contact them for additional information.”