Steamboat Springs Shawn and Audrey Zwak met in Steamboat Springs more than 15 years ago. They were married here. They've made their careers here. Their three children were born here.
But their lives in Steamboat aren't complete. The Zwaks, like so many other local families, dream of someday owning a home here.
"The kids want to have dogs and a yard," Shawn said. "We want the security of having our own place."
Shawn is a community service officer for the city of Steamboat Springs. Audrey is about to increase her part-time role with the preschool at Christian Heritage School to full time. They pay $866 per month for a rent-controlled, three-bedroom unit at Mountain Village Apartments.
The apartment meets their needs, they said. For now, it's the best they can afford.
The Zwaks are not unique. More and more families whose incomes would allow them to purchase a home in just about any other community in the country are finding they can't do so in Steamboat.
With a median home price that is greater than $300,000, housing is the great divide that separates those who own a piece of Ski Town USA from those who are on the outside looking in.
By the numbers
In Steamboat, where the typical building lot costs more than $90,000, the gulf between families' purchasing power and the cost of housing is growing.
The median income in the city grew dramatically in the 10 years from 1990 to 2000, according to Census Bureau statistics.
Still, incomes didn't keep pace with the median home price.
The median household income in 1990 was $29,363 and has since grown to $54,647, an increase of 86 percent. The median family income (everyone in the household is related) is even greater $65,685.
By comparison, the median home price here rose from $119,700 to $308,000. That's a 157 percent increase in 10 years, nearly double the rate of income growth.
For people who don't own a home, the median price may not be the most important number. The median home price represents the precise middle of the range between the lowest- and the highest-priced homes. Families trying to acquire their first home here will be focused on the lower end.
The problem is, there's not much to focus on.
Of the 1,642 homes in Steamboat reported by the census, just 191 were valued at less than $200,000. And of that total, 124 cost more than $150,000. And because the census gathers data about people living here, its information about the value of homes doesn't measure housing currently on the market.
Analyzing the market
Statewide, the biggest concentration of homes is found between $150,000 and $199,999. In Steamboat, the biggest concentration is between $300,000 and $499,999.
John Worden, former president of the Steamboat Springs Board of Realtors, said it's tough to find many single-family homes to choose from for less than $250,000.
Worden conducted a computer search of the properties contained in the Steamboat Springs Multiple Listing Service on July 1. Just seven single-family homes were priced at less than $250,000. When he expanded the search to include duplex units, triplex units and townhomes, the number jumped to 32. And when he added condominiums, there were 141 homes to choose from (including duplexes, townhomes and single family).
One caveat Worden cited regarding condos is that if they are within a project intended for vacation rentals, association fees can quickly amount to $500 or $600 a month. That renders them unaffordable for many local families.
Building lots priced at $90,000 probably don't qualify as opportunities for affordable housing. But that's just about the floor in Steamboat. There were just 29 lots for less than $100,000. Of that total, just three were within the city limits. Draw the line a little to the west of Steamboat proper, and eight more lots popped up in Silver Spur Estates.
Trying to catch a break
Mary Crotz, a mortgage loan specialist at Alpine Bank, said people who are serious about qualifying for a mortgage need to trim existing debt. She said many local residents have difficulty doing that because having "all the toys" is part of the Steamboat lifestyle.
Frank Lawhead doesn't have excessive debt. He doesn't have all the toys. But he knows what it means to get married and have a kid, buy a house, struggle to afford the house, get divorced, and have to start all over again.
Lawhead moved here from San Diego seven years ago. His son, Camden, was just an infant when he and his wife purchased a three-bedroom, two-bath home in Copper Mountain Estates for $70,000. The mortgage payment was about $1,000, plus they paid a little more than $300 lot rent in the subdivision.
Even in the most affordable subdivision in the city, it wasn't easy, he said.
"When I first came to Steamboat, I was working two jobs," Lawhead said. "We had a new baby and it put a lot of stress on the relationship. I was framing during the day and working at Cugino's (restaurant) until midnight.
"I did that four or five days a week for two years. I was never there."
Today, Lawhead is a superintendent at Hillside Apartments, a subsidized rental housing project where he also lives. Camden is 5. Lawhead has joint custody of his son, who is a big part of his motivation for trying to purchase a home.
"If I was a single guy, I wouldn't be so concerned," Lawhead said. "I want a home for Camden. I want him to have his own bedroom a place he can call home."
Lawhead attended the Housing Expo hosted by the Regional Affordable Living Foundation on June 25. He was trying to make the numbers come out so he could afford one of the single-family homes RALF is developing in West End Village, the city's first subsidized affordable housing project in which residents own their homes.
But no matter how Lawhead did the math, he came up short.
In addition to 24 single-family homes, RALF is developing 14 duplexes and 22 townhomes, for a total of 60 residences in West End Village. Lawhead makes about $23,000 and change annually. His income allows him to qualify for a 1 percent USDA loan that would qualify him for up to $157,000 at a mortgage payment of just $600 a month.
But RALF's least expensive single-family home is coming to market at $162,800.
After having his name drawn 26th out of more than 175 people interested in one of the RALF homes, Lawhead is optimistic there will be a few dropouts that will boost his name into the top 24.
That leaves the small matter of coming up with another $6,000 to make his dream come true.
"Some people ask me, 'What about Craig or Hayden?'" Lawhead said. "If I had wanted to live in those places, I would have moved there. When I came here from San Diego, it was for the lifestyle and a place to raise my son."
The downpayment hurdle
Orval and Audrea Robbins were less optimistic as the affordable housing expo wound down last month. They drew number 165.
"It isn't going to happen for us," Orval said with a resigned smile. "I think I'm quite a ways away from a single-family home through this project."
Orval moved his wife and 13-year-old daughter here from Grand Junction a year ago. He works as a carpenter for both Brotherton Construction and Appalachian Hardwoods, putting in as many as 60 hours a week in the summer. Audrea worked at the ski area last winter.
The family can afford to make mortgage payments they're already renting a home in Steamboat II. But Orval can't come up with the standard 20 percent downpayment on a home of his own. Twenty percent of $300,000 is $60,000.
He said sometimes it's tough to help build luxury homes for others when he knows he can't afford a home of his own in Steamboat.
"We build homes for people who live here two or three months a year," he said. "Really, it's the people who go to work every day who make it work who really make Steamboat what it is."
But Crotz, the mortgage loan officer, said families like the Robbinses who have good credit and not a lot of existing debt can get into housing without a 20 percent downpayment if they don't mind paying a premium for mortgage insurance.
Most of the people who put 20 percent down on a $300,000 house either inherited some money or came into money in some other way. Very few actually are able to save enough to make a 20 percent downpayment in cash.
"That happens about once every five years," Crotz said.
As a case study, Crotz uses the example of a mythical couple making $75,000 a year. They are looking at buying a home valued at $265,000.
Assume they can come up with only a 5 percent downpayment of about $13,000. Also assume that they have an OK credit rating and while they have a car payment, their credit card balances are low.
At an interest rate of 6.5 percent, Crotz might be able to qualify them for a mortgage at a monthly payment of $1,915. That monthly payment would include mortgage insurance of $164.
Perhaps that mythical family cannot find a home that meets their needs for $265,000. That's not unlikely in Steamboat.
The same family could opt to commit 41 percent of its income to its housing and qualify for a $350,000 house with a jumbo loan. That would require a monthly payment of $2,563, including $216 a month in mortgage insurance.
The family would still have car payments and other bills of $500 to $600, and while they might make contributions to an employer-sponsored 401(k), they wouldn't have room for much else in the family budget.
"You would not have a savings account," Crotz said. "There's no way."
Erik Dargevics at Cherry Creek Mortgage has a no-downpayment option for people in Steamboat who have the income to leverage $300,000. He's offering 103 percent financing for qualified buyers purchasing three-bedroom townhomes in the next two buildings of the Quail Run project on Whistler Road. The 103 percent financing covers most of the closing costs associated with the purchase.
But buyers will have to be willing to stomach hefty mortgage payments the cost of leveraging $300,000 is $1,750 plus escrow. That's on a 30-year adjustable rate mortgage with an interest rate of 5.75 percent locked in for the first five years. And the townhome owners will also have to pay association fees.
"You're going to have to have good credit, but it's a great way to get started," Dargevics said.
The only catch is that a married couple will probably need an income of more than $67,200 to qualify for a loan.
Of course, half the people in Steamboat Springs earn less than the median family income. A more pertinent number for people seeking affordable housing might be the typical salaries of employees working in Steamboat.
The census reports the mean salary for a woman working full time, year-round here is $28,244. For men, the number jumps to $35,536. Assume that a household includes two wage earners, and those salaries achieve the mean family income. But the news is obviously tough for single parents, and in particular, for single mothers.
Crotz can initiate government subsidized "rural development loans" that offer 100 percent financing without the need to pay mortgage insurance. While other loan programs require hefty incomes, this program caps income levels at maximums based on the size of the home. The loans are good for single-family homes, townhomes and condominiums, Crotz said.
The income limits are $45,110 per year for a single person, $51,500 for two people and $57,950 for three. The limits go up to $74,700 for six people.
But the programs only work if residents have prepared themselves for homeownership. Unfortunately, Crotz said, many are overburdened with debt, making it difficult for them to make payments on a Steamboat home.
"That's the thing we run into most," Crotz said. "I have people coming in who just bought their new truck last month and their payment is $600. And they have $10,000 on credit cards. There are a lot of them, believe me."
Committed to Steamboat
Credit card debt was not the Zwaks' problem.
For a number of years, the Zwaks enjoyed the advantages of caretaking luxury homes. That became less practical when their family began to grow. Their daughter, Hannah, is 10 and son, Sam, is 7.
But their lives really changed three years ago when their daughter, Ellie, was born with a heart defect. The family almost lost her when she had open-heart surgery at 8 months her heart stopped on the operating table. The ramifications of the minutes that her brain didn't have oxygen will always be with her. She still doesn't walk and she will likely always be legally blind.
The Zwaks were on the verge of buying a condominium when Ellie had her surgery.
Despite having good health benefits through Shawn's job, and an outpouring of support from the community, the financial strain of Ellie's surgery meant the family had to postpone the dream of owning a home.
The family hopes to work its way back soon. Shawn has been taking shifts as a firefighter at Yampa Valley Regional Airport to augment the family income.
The extra work takes him away from his children, but Shawn said it's a small price to pay.
"We're still optimistic," Shawn said. "We tell the kids that within a year we'll be in something or ready to be in something.
"We're committed. It's worth the extra money it costs to live here. It's worth a lot of money to be in this small town. Something would have to force us out."