A total of 51 sales transpired in the Town of Telluride, representing total gross dollars of $54.9M YTD.  A total of 72 sales occurred in the Town of Mountain Village with gross dollars of $94.6M.  The remainder of San Miguel County experienced 38 sales totaling $39.7M.  It appears as though the upper end of the market is garnering considerable interest.  There have been a total of 29 sales in the Telluride region above $2M, with 15 sales above $4M and three transactions between $8M-$10.1M YTD.  Another Mountain Village home with an asking price of $10.5M is currently under contract.  These high-end sales show a dramatic improvement, as during the same period in 2009 there were only 13 sales above $2M. 

While we do not anticipate a boom cycle on the near horizon, this data seems to indicate a strong renewed interest in investment in the Telluride lifestyle with its limited, high-quality inventory. The catalyst for stronger sales has been a willingness by some sellers to accept price levels 25-30% below the market highs of 2007. Those sellers are not necessarily in "must sell" situations, but are oftentimes seeking liquidity for alternative investments. Investors are gravitating to discounted "Grade A" properties and seem to be avoiding a limited number of problematic foreclosure and short sale scenarios.

With the velocity of sales increasing, it is likely that a "bottom" has been reached and sellers will over time resist these deeper discounts, and the market will respond with gentle appreciation. Those sellers who have held firm with price structure must remain patient, but oddly have contributed to "setting the bottom," and will influence the rise in future values. With 12 homes transacted in the past 120 days at $800-$1,075 PSF, this cycle is likely in motion.

View Telluride's hot real estate picks - Best values in Telluride's real estate market