Aug 19, 2004
It is currently a buyer's market in Keystone. Suffering from over-building and what some would call exaggeration by the sales associates on the new launches, many transactions in the past year have resulted in losses for the sellers. Older Properties (Built 1974-1981) With the older properties around Keystone Lake and across the River nearer the slopes, you get larger units. One bedroom condos typically range from 700 to 950 square feet, and two bedroom units range from 950 to 1500 square feet. No special assessments in any of these projects (at this writing).
However, dues are typically higher, ranging from about $350 per month to as much as $700. However, the higher dues usually include a "replacement funds reserve." They tend not, however, to include heat, which is electric heat in most of the properties. Rental incomes are higher than "out-of-resort" properties by 10-15%. Newer Properties (Village at River Run) Unfortunately for earlier buyers (now sellers), but fortunately for new buyers in the market, the developer over-built the new Village. Original projections called for no more than 80 units a year for a reasonable absorption rate. This rate was maintained for their first three buildings. Then, as Buffalo and Dakota, then Expedition Station, Red Hawk and The Springs came online, the new units being built increased to about 120 per year.
This was more than the buying public could handle, and hence, the developer is still trying to sell out these projects. The area has been overbuilt, and there is still much inventory to be absorbed. In addition, buyers who anticipated being able to "flip" their units in a year or so at a profit have been sadly disenfranchised. And, many in the real estate community concur that the sales team may have exaggerated the potential for near-term future profits.
Keep in mind that these new units also added to an overall market inventory of rental units while skiier days have remained relatively flat. So, income projections have also generally not been met. The good news is that (1) the buildings tend to have been constructed well - with steel and concrete being the mainstay methods - and (2) dues tend to be less and are all-inclusive - heat is gas and the buildings have central boilers.
As of April, 2002, approximately 22% of all units are on the market at an average of 15% off the original price. Balancing the Two When comparing the two categories above, you will find that the older properties cost less, are larger, have better rental income, but have higher dues.
The newer properties cost more, are smaller, have somewhat smaller rental figures, but have lower dues. Financially, they should balance out fairly well, so it becomes a matter of choice.
And don't let distance to the slopes affect your decision unless you just have to be in the midst of the action. The Keystone Shuttle runs every 10-15 minutes, and have clean and fast coaches. You're never far from the slopes.