If I had a million dollars would I buy Vail real estate?
January 6, 2009 —
Something about Vail makes me feel warm, no matter how cold it is ... but when I see the pricetag I shiver.
For a guy like me, who grew up licking $4 ice cream cones in at the Crossroads Haagen Daaz, you’d think I’d be bullet-proof to the cost of living in Vail.
But now Crossroads is Solaris, or at least it will be in 2010, and across the street is One Willow Bridge Road. These aren’t the homes of my friends, who I used to meet outside to go ride bikes. These are lifelong dreams come to fruition. People see these places at Solaris and One Willow and think: “One day I’ll own something as amazing as that,” and they go home, get a few masters degrees, inherit a couple mill, invest wisely, conquer Wall Street, fail miserably, build themselves up again, and only they can spend $5 million or so on buying a piece of the dream.
If I had a million dollars would I buy Vail Real Estate? Absolutely, so long as I had five or six partners who could supply the other four million it takes to own a piece of my old hometown.
Vail is rock solid, market wise. We’re for real.
We’re not pretenders and we’re not going away. A year from now, maybe two, Vail real estate could be worth less than it is now. Nobody knows. But in the long term there is no safer bet.
That’s why it’s a million just to walk in the door.
Excuse me if I sound crass … I was always taught not to talk about money. But I recently finished writing a piece on the top four best Vail real estate buys. I realized, while writing, that you don’t buy Vail real estate by writing about it … you just get a peek and then the obsequious guide sends you on your way while you refocus your dream on something farther away, something more impossible.
But here’s the question no one is willing to answer: where do all these millionaires come from?
I’ve driven back and forth on this Valley’s roads more times than I can ever count, and once in a while it occurs to me: where to all these millionaires come from?
Aspen has some, Tokyo some more, and so do Vegas and Monte Carlo and all the penthouses at the Ritz.
But here's the secret: most are pretenders. There’s no way there’s so many people with that much money that this Valley, which saw a 74 percent increase in home values from 1998 to 2004. As our housing prices inflated, more and more people thought they could handle the upgrade, buy the big house. They weren't buying a home, they were investing. They come once a year, maybe never.
Why not? At the very least, you could turn around and sell it, right?
No. Not so much.
In the early 1980s Vail old-schoolers learned the hard way that real estate can plummet faster than a stiletto heel through water-damaged subfloor. My dad was a general contractor way back then, and my family felt the squeeze of a down housing market. As things recovered, everybody got hyped, and there was a massive growth explosion through the 90s and into this century.
Everyone thought they could get a piece. Vail wasn't the place to BE anymore, it was the place to BUY. You walk into a bar to meet friends and they’re talking real estate. It wasn't a ski town, it was a real estate town, with 55 percent of our economy based on real estate transactions.
It was a gold rush.
People lost their heads.
They over-reached. They pretended. The speculation has made everything more difficult for those who want to live in Vail with their families year-round.
And now here comes the inevitable crash.
And here’s the lesson I keep hearing from all the old-schoolers: If you want to stay in the Valley, bear it out. Suffer. Things will turn around. They always do. And if they don’t, they won’t for anyone, so you might as well ski as much as you can. Just hold on. Try to stay positive. Love your family. Cherish what you've got. Take your losses gracefully.
Because these days if you want to buy here, you've got to be here, too.
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