Thursday, January 23, 2020

Frisco council focuses on phase two of Marina Park improvements

#Frisco #Colorado

The Frisco Town Council has turned its attention back to the marina as the town moves forward with the second phase of the Frisco Marina Park Master Plan.
In August, the town officially cut the ribbon on the “Big Dig” project — a grand reopening of the marina park following the excavation of 85,000 cubic yards of dirt from the lakebed, lowering the floor by as much as 13 feet in some areas and creating about four new acres of land for future improvements.
Now, with spring approaching, officials and staff with the town are beginning to focus in on what’s next.
At the Frisco Town Council meeting last week, Matt Stais of Frisco-based Stais Architecture & Interiors and Elena Scott of Norris Design provided councilors with a presentation on preliminary design options for the phase two site improvements outlined in the master plan, which was adopted in 2018. The designs touch on a number of coming upgrades, including parking, the main entrance, walkways, lawn space, and a new fuel system and lift station, among others.  
But the biggest pieces of the project are likely the new guest service and office building set for construction later this year and the potential repurposing of the Lund House and food and beverage spaces on-site.
“We’re on to phase two improvements, which we’re hoping will include a new marina office building, repurposing of the Lund House, the Island Grill and baths,” Stais said. “The infrastructure is also very important for the phase two area: water, sewer, electric and gas. … Basically, we are hoping to build onto the Big Dig from phase one, address immediate needs and allow for future growth.”
During the presentation, Stais proposed placing a new single-story, 2,290-square-foot office building along the south side of the park, to the east of the existing Island Grill location. The structure is expected to be considerably smaller than the initial design (4,846 square feet), though staff is hopeful the new concept can provide a cheaper option that would still offer plenty of new office space for marina staff in addition to expanded retail space. While smaller than expected, Stais noted the design would remain flexible to allow for expansion as operations at the marina continue to grow.
“The key to phase two is not putting things in the wrong place,” Stais said. “We want to make sure the work we do, whether it’s with utilities or buildings, will allow for future flexibility. We’re talking about another 10, 20, 30, 40 years — there’s a lot of connections going out to Summit Boulevard and to Main Street, and from Main Street to the mountains. We want to make sure we put things in the right location and allow for that future growth.”

Wednesday, January 22, 2020

State senator proposes classifying short-term rentals as commercial property, leading to a tax hike

#Summit County #Colorado

The Colorado Association of Realtors alerted local real estate organizations Jan. 16 that a bill has been introduced in the state Senate that would change the designation of short-term rental units from residential to commercial, resulting in an increase in property taxes from 7% to 29% across the state, according to the industry trade group. 
“We’re very disappointed … ,” Summit Association of Realtors former president Thomas Coolidge said. “We’re going to reach out to our legislators on all levels and try to come up with some compromise that we feel is reasonable given that short-term rentals are such an important part of the economy.”
Current Summit Association of Realtors President Dana Cottrell said the association met previously with state Rep. Julie McCluskie, D-Dillon, to discuss a similar bill, which was later dropped. Senate Bill 20-109 now has been picked up by Sen. Bob Gardner, R-Colorado Springs. 
“It would negatively impact investors in the community if all of a sudden you have to take on this very increased property tax,” Cottrell said.
Cottrell said that when she met with McCluskie, the motivation McCluskie had behind sporing the bill was that she felt if a property was used as a type of commercial investment, it should be taxed as such. 
“People want to offset their costs,” Cottrell said. “I want to protect the people that want to have a second home up here and want to offset those costs. I want them to use their properties as they see fit.”
The bill defines a short-term rental property as a building that is used “predominantly as a place of residency by a person, a family, or families,” but is leased for short-term stays. For the purposes of this proposed tax law, a property qualifies as a short-term rental unit only if it is occupied by the owner for less than 30 days per year.
For example, if a family on the Front Range has a second home in Summit County and stays for a month over the course of a year, they can still rent their home out on Airbnb or through a property management company for the rest of the year without being subject to commercial property taxes. 
Breckenridge Town Council member Gary Gallagher said the council generally supports a bill like this that applies to short-term rental properties that are being run like a business rather than families who just want to rent out their property a few times per year. 
“From many of our perspectives, I think what it really comes down to is if you want to run a business, then I am very comfortable with them being treated as commercial property and being taxed as such,” Gallagher said.
Gallagher said a short-term rental that is being operated as a business should not get special tax benefits compared to restaurants, hotels or other commercial properties in town. 
“Let’s call it what it is: It’s a business,” Gallagher said. “We tax other businesses as commercial properties.”
Mark and Mary Waldman, owners of Summit Mountain Rentals, disagree that the 30-day caveat would protect second-home owners. 
“The average owner stays 14 to 20 days. It’s just a gimmick to make it more palatable,” Mark Waldman said about the 30-day exception. 
If the bill were to be enacted, the Waldmans think it would affect more than just real estate. 
“For those of us who live in the mountain community, it will be a collapse in real estate prices because the people who own here … are heavily dependent on tourism for our sales tax dollars. If these homeowners are taxed 3.14 times more … they simply won’t rent, and then they’ll choose to sell,” Mary Waldman said. 
The Waldmans added that this would have immediate impacts on real estate professionals in the area. Summit Mountain Rentals has a staff of 43 people, but the Waldmans said this would have to be reduced if the bill passes. 
“If this tax hits, a large portion of that staff goes away to accommodate that reduction in economic needs,” Mary Waldman said.
Mark Waldman said they are forecasting a 20% to 50% reduction in rental units.
“We feel it’s a very short-sighted effort to try to collect some more taxes,” Mary Waldman said, adding that as a representative from Colorado Springs, Gardner sees a very different economy. “Big cities, they don’t rely on 90% of their income from the tourism industry. I feel that he doesn’t understand the mountain community.”
Breckenridge Mayor Eric Mamula explained that as the town of Breckenridge doesn’t rely heavily on property taxes, he doesn’t anticipate a major economic impact should the bill pass.
“There has been some discussion that, look, these things are commercial enterprises, and that’s how they should be taxed,” Mamula said. “Some of these homes that are rented all year long, they have impacts on the community, and they have impacts to the county at large.”
Mamula pointed out that the town of Breckenridge mainly exists on sales tax and while the bill could decrease homes in the short-term rental pool, it could then free up homes for the long-term rental market. He said that when Airbnb and VRBO came onto the scene, many of these long-term rental units that were used by local employees were eaten up by the more profitable short-term rental market. 
“Maybe this just balances things back out the way that it was beforehand,” Mamula said. “It is hard to gauge the long-term effects of a decrease in short-term rentals, but an increase in long-term rentals? That we sorely need.”
 Courtesy of the Summit Daily News.

Tuesday, January 21, 2020

CFPB planning to eliminate DTI requirement from QM lending rules

Over the last several months, a number of the nation’s largest lenders and housing trade groups have called on the Consumer Financial Protection Bureau to make changes to the Ability to Repay/Qualified Mortgage rule.

More specifically, Bank of AmericaQuicken Loans, Wells Fargo, Caliber Home Loans, along with the Mortgage Bankers Association, the American Bankers Association, the National Fair Housing Alliance, and others asked the CFPB to do away with the QM rule’s debt-to-income ratio requirement.

And now, it looks like they’re going to get their wish.

In a letter sent last week to several prominent members of Congress, CFPB Director Kathy Kraninger said the bureau has decided to propose an amendment to the QM Rule that would “move away” from DTI as a factor in mortgage underwriting.

Specifically, Kraninger said the CFPB has decided to shift from the DTI standard and move to an “alternative, such as a pricing threshold (i.e., the difference between the loan’s annual percentage rate and the average prime offer rate for a comparable transaction.”

According to Kraninger, the proposed alternative would be “intended to better ensure that responsible, affordable mortgage credit remains available to consumers.”

The Ability to Repay/Qualified Mortgage rule was enacted by the CFPB after the financial crisis and requires lenders to verify a borrower’s ability to repay the mortgage before lending them money.

This includes a review of a borrower’s debts and assets to ensure they have the ability to repay the loan, with a stipulation that their DTI ratio does not exceed 43%.

Sunday, January 19, 2020

Summit County’s adoptable pets for the week of Jan. 19, 2020

#Frisco #Colorado

Contact the Summit County Animal Shelter. Call the shelter at 970-668-3230 with questions.


ASHTON, 8 months, domestic shorthair, black, neutered male
CATALONIA, 8 years, domestic shorthair mix, white and gray, spayed female 
CLARA BOW, 5 months, domestic shorthair, brown tabby, spayed female
DECKER, 3 years, domestic shorthair, brown tabby, neutered male 
KRIS, 4 years, domestic longhair, black and white, spayed female
MARIA, 7 years, domestic shorthair, gray tabby, spayed female
MARIE, 6 months, domestic shorthair, brown tabby, spayed female
MIMI, 2 years, domestic shorthair, brown tabby, spayed female
MISTER, 7 years, domestic shorthair, gray and white tabby, neutered male
MORRIS, 6 years, domestic shorthair mix, apricot, neutered male
NOD, 9 weeks, domestic mediumhair, black and gray, unaltered female
NUTMEG, 4 years, domestic shorthair mix, tortoiseshell, spayed female
PENELOPE, 3 years, domestic shorthair, gray tabby, spayed female
RAVEN, 12 years, domestic shorthair, black, spayed female
TINKERBELL, 7 years, domestic shorthair, gray and white tabby, spayed female
TWINKLE, 9 weeks, domestic mediumhair, black and brown, unaltered female
WINKLE, 9 weeks, domestic mediumhair, black and brown, unaltered male 


BENJI, 10 months, German shepherd mix, black and tan, neutered male
JOE, 9 months, Australian shepherd mix, brown and black, neutered male
KERA, 3 years, American foxhound and Catahoula leopard hound mix, tan and white, spayed female
LINKIN, 9 months, German shepherd mix, black and tan, neutered male
LUCY, 3 years, Plott hound mix, brindle and white, spayed female
MAGGIE, 2 years, Australian cattle dog mix, tan, spayed female
NELSON, 1 year 6 months, Labrador retriever, tan, neutered male
SARAH, 3 years, Chinese sharpei mix, red, spayed female


BEATRIX, 1 year, Rabbit sh, black, unaltered female

Saturday, January 18, 2020

Breckenridge Town Council considers exceptions to short-term rental occupancy limits for large properties

#Breckenridge #Colorado

At Breckenridge Town Council’s work session Tuesday, Jan. 14, members discussed an addition to an ordinance that sets occupancy limits at short-term rental units.
The ordinance, which was passed Sept. 24, allows two people per bedroom plus four additional people, a limit that has drawn complaints from some in the lodging community.
Town Finance Director Brian Waldes presented council with an option to create exceptions for larger short-term rental properties. Waldes said a formula used by other towns in Summit County would allow one person per 200 square feet. 
Council members had mixed views on allowing for variances.
“I really feel short-term rentals are not helpful to this community,” council member Gary Gallagher said, noting that the short-term rental market has adversely impacted the long-term rental market. “I am not going to vote for it, will not create more ills for our community.” 
Gallagher acknowledged the short term rental market is already in Summit County — that council has “let the genie out of the bottle” and can’t backtrack what has been done — but said he would not support any more leniency with short-term rentals.
“All you’re doing is adding more people to this community at critical times of the year when we’re already overflowing,” Gallagher said. 
Council member Kelly Owens agreed and said the core issue is the effect on the housing crisis in Summit County. 
“I think that to really be responsible and follow the vision of this town — which is to enhance the community and allowing people to work here, to live here — then sticking with the current occupancy limit is the more responsible choice,” Owens said. 
Council member Dick Carleton was the first to voice support of exceptions for larger homes, saying he would suggest allowing higher occupancy for homes that are 4,000 or more square feet.
Carleton added that in order to grant occupancy exceptions to larger properties, it should be required that the property uses a local management company.
Council member Wendy Wolfe wasn’t sure about the 4,000 square foot designation. 
“Help us find what is the right size in this community,” Wolfe said to Waldes.
Waldes also presented an option for limiting occupancy regardless of square feet. A maximum occupancy limit of 24 people was provided to council as an example.
Mayor Eric Mamula added that homes that had a larger occupancy limit prior to the ordinance should be able to keep that larger occupancy. However, he said that should not apply to properties that have had issues, such as numerous noise complaints. He also said there should not be exceptions for newly built properties.
Krista Rider, co-owner of Paragon Lodging, worked with the town along with the owners of Summit Mountain Rentals to present potential solutions to council.
“We’re super sensitive to this community and the impact, but these homes are not in that caliber for a long-term rental,” Rider said about large lodging properties. “These are more trophy homes that families get together at. We’re worried that that business is just going to go away.”
Rider said the rationale for an exception for larger houses is that comparing the number of bedrooms of a house is not apples to apples and gave the example of comparing a 1,500-square-foot, three-bedroom home to a 3,000-square-foot, three-bedroom home. 
“Our whole philosophy is not to pack people in,” Rider said. “We’re more in the mindset that if the property has more capacity, it could house more people. We have a two-bedroom home that is 3,000 square feet. It’s just with those larger home markets, they’re just different.”
Rider also pointed out that the homes are typically not causing the problems that neighbors have with short-term rentals. Paragon Lodging’s clientele is typically multigenerational families, family reunions and groups of a few families, according to Rider. She said the company has a strict noise ordinance, a maximum amount of cars guests can bring and requires a renter to be at least 25 years old.
“If they do decrease that occupancy, the way that the formula is as it stands, it would impact probably 14 to 15 homes that we represent in the town of Breckenridge,” Rider said. “What the worry is, is that those people are just going to go elsewhere. I’m hopeful that maybe we can get a good solution to this.”
Rider said the lodging representatives involved in working with council will bring back research about the issue, and she added that she is pleased council is willing to listen to the lodging community’s concerns.
Breckenridge Communications Director Haley Littleton said the issue will be brought back to council as a proposed ordinance at a future meeting.
Courtesy Summit Daily News.

Friday, January 17, 2020

Housing market challenged by a dearth of construction workers

One of the biggest challenges facing the U.S. housing market is a dearth of construction workers that’s keeping homebuilders from meeting the demand of an expanding population, according to Federal Reserve Governor Michelle Bowman, one of the people who votes on the central bank’s monetary policy.

A shortage of properties on the market has been restricting real estate sales in some parts of the country, she said. 
The answer is building more homes, but housing starts have lagged household formation, she said.

One of the biggest reason for that is the lack of construction workers, Bowman said Thursday in a speech in Kansas City, Missouri.

“The ratio of job vacancies to unemployment in the construction industry – a measure of labor market strength – shot up to historic highs at the end of 2018, and it has remained near those levels,” Bowman said. 

“These indicators confirm what I have been hearing from construction industry employers during my visits to different parts of the country – it’s extremely difficult to find and hire workers, skilled or otherwise.”

One solution is vocational training programs that connect young adults with jobs in the construction industry, she said.

“I am hopeful that these efforts, along with a continued strong job market, will encourage more people to join – or, in some cases, rejoin – the construction trades,” she said.

Single-family housing starts likely will total 1 million in 2020, the highest since 2007, the National Association of Realtors said in a forecast last month. In the five-year period that ended in 2019, the average was 822,000 a year, according to government data. From 1958 to 2007, the year before the housing crash, single-family housing starts averaged 1.1 million as the population expanded.

Housing is an issue that has a broad impact on GDP, said Bowman. Spending on existing homes as well as the construction of new residences accounts for 15% of the U.S. economy, she said.

“My colleagues and I at the Federal Reserve pay close attention to developments in the housing sector, in part because it has historically been such an important driver of economic growth,” Bowman said.

 “If we include the amount families spend on shelter each month as well as the construction of new houses and apartments, housing generates about 15 cents out of every dollar of economic activity,” Bowman said.

Courtesy HousingWire newsletter.