Our View: Housing flexibility needed

Advertisement

Editorial Board, May 2008 to August 2008

  • Bryna Larsen, publisher
  • Brent Boyer, editor
  • Mike Lawrence, city editor
  • Tom Ross, reporter
  • Eric Morris, community representative
  • Paul Draper, community representative

Contact the editorial board at (970) 871-4221 or editor@steamboatpilot.com. Would you like to be a member of the board? Fill out a letter of interest now.

— As the city's landmark affordable housing policies are enacted in new development projects, the Steamboat Springs City Council must be prepared to adapt those policies to existing market conditions. Without adaptation, the policies have little chance of achieving their desired and worthwhile result: the creation of attainable housing for our work force.

When the previous City Council adopted the city's inclusionary zoning and linkage ordinance just more than a year ago, the goal, put simply, was to deliver the right housing product at the right price and right time for our work force.

But the housing market is changing. Numbers that seemed to work on paper in June 2007 might not work in the reality of June 2008. And for developers, who rarely can afford to have unoccupied units sitting on the market, timeliness is everything.

A case in point is the struggling sales at First Tracks, the affordable housing development associated with the Wildhorse Meadows and One Steamboat Place projects.

First Tracks' requirements mandate that the average buyer of an affordable unit make 100 percent of the Area Median Income. Meeting that requirement means having a mix of buyers in the 80 percent to 120 percent range.

But those who have showed the most interest in First Tracks - and qualified to be purchasers - make an average of less than 80 percent of AMI.

"We've done everything we could," said Brent Pearson, vice president of Resort Ventures West. "It's just been difficult to get people to buy into (First Tracks) based on the facts of the deed restrictions."

Developers from Resort Ventures West have proposed several requirement changes to help sell the units, including allowing businesses to purchase the units for their employees, instituting an occupancy-based deed restriction, and allowing appraisal-based deed restrictions, which would give buyers the chance to realize greater growth in equity once the property is vested.

Steamboat Springs Community Housing Coordinator Nancy Engelken has suggested similar adjustments, as well as changing developer requirements from being based on the number of units to total square footage.

The conversations and ideas are encouraging. They show a creativity that will be particularly important as larger development projects come on line, notably Steamboat 700. Flexibly meeting the demands of a changing housing market will benefit sellers and buyers of local affordable housing - and ultimately benefit the entire community.

Not to be forgotten is the ongoing market demand analysis sponsored by the city, Steamboat 700, the Yampa Valley Housing Authority and a number of local businesses and developers. The study, with results expected in August, aims to paint a clear picture of the actual housing needs of the community based on direct feedback from employers and employees.

As First Tracks is proving, and as we believe the market demand analysis will show, the city's housing ordinances already are in need of tweaking.

Armed with information from the market demand analysis and the experience of developments such as First Tracks, the City Council should find itself in a position to make needed, appropriate changes to its affordable housing policies to keep a thriving work force in the Yampa Valley.

Comments

thecondoguy1 6 years, 2 months ago

ya sure, the city is going to have a nimble, flexible, ready to change on a dime housing program, and Iacovetto's cows are going to fly.................

0

JustAsking 6 years, 2 months ago

"TWEEKING?" The writer is a master of understatement. How about "hopelessly flawed city council mandated socialist program."

This "let's pass this so we feel good" fiasco while ignoring what is really need, more rentals, shows just how far in THE LEFT field this bunch is.

It is incredible that all who are employed to oversee and promote Affordable Housing choose to ignore the fact that THE NUMBERS DON'T WORK.

Fundamental questions remain unanswered: Please review this post from your "Our View: Housing strategy undefined" editorial back in JANUARY!

Has anybody else noticed the lack of a "box score" of the results of the local "affordable housing" bureaucracies? Looks from here that a LOT of money is being collected and spent on salaries and studies but what are the results? How many units? WHO is living in them? Is this government mandated give-a-way effort really doing anything for the majority of the group that it purports to help? LET'S SEE SOME NUMBERS! I'm betting the numbers will show that Sbvor is correct.

(What did you guys do to SBVOR? Can't find his posts.)

This expensive bureaucratic effort is destined to do little or nothing for the vast majority of the class that they claim to want to "help." Note to "DO GOODERS": I would rather live in a condo, townhouse, duplex or single family home with 4 or more UNRELATED friends than the Iron Horse, but you have made that ILLEGAL. I would rather rent an apartment in a complex but you have made it IMPOSSIBLE for a developer to build anything like this that could be profitable for him. How about those 96 units at Wild Horse some of you are bragging about? How many square feet? Bedrooms/baths ? Cost? Who are the "chosen" ? How much MORE expensive will the other units have to be because the developer has to add COST to the rest of the units available to the rest of us who don't get in on the "entitlement"? (Note: to Idiots. Business is entitled to profit for taking risk and return on investment. ) There will have to be profit on the 96 transferred to the rest of the units? SURPRISE! This drives up prices for everybody else. News Flash for those of you who think you are just going to stick it to " those rich out of town owners": YOU ARE JUST STICKING IT TO YOURSELVES by policies that CONTINUALLY drive up prices.

Does any of this ring a bell? The Pilot could do us all a service by asking the highly paid staff of Affordable Housing the hard questions and printing the answers.

0

ThreeJobs 6 years, 2 months ago

Are you really surprised that this program is a failure? Why would anyone want to sign up? Think about it. Pay out a high percentage of what you make to buy a small space that you may not be able to sell when you want to move on. About the only thing that might work out is a buyer renting out a room but I think that is against the rules.

Why doesn't the city work with somebody to build some apartments? That would offer housing to more workers than expecting them to buy into a deal that makes no sense. Too bad the devleloper got caught by the politics. Obviously this will only drive up prices on the whole project. I agree with justasking. The paper has an obligation to us to get some answers and stay on top of this issue. Bringing it up every 5 or 6 months is not enough.

0

Steve Lewis 6 years, 2 months ago

How can you say First Tracks is a failure many months before it even has built a unit to show?

Yes the ordinance can be tweaked for the better. But its premature by more than a year to judge First Tracks. A year after the C.O. of the project will be the time when the plan's "escape clause", currently to the free market, triggers.

The current imbalanced emphasis on ownership is because the rental ordinance, "Linkage", was much more opposed, and trimmed, than the ownership ordinance, "Inclusionary Zoning".

Back when the ordinance was put together, the IZ ordinance would cost a residential project about 2-4%. That was during a time our market prices went up more than 20%. To say the ordinance is the reason for high prices is not a fair analysis.

Its worth remembering the ordinances only ask enough units to house the new, permanent workforce CREATED BY each development. Asking a developer to mitigate his impacts to a community is smart. -Steve Lewis

0

ColoradoNative 6 years, 2 months ago

The economy is so unstable it's simply impossible for the housing authority to "time" all the factors. From the time a builder pulls permits to delivering units anything can happen in this market.

For crying out loud gas is fluctuating 25 cents a week.

One thing is certain under FREE MARKET CONDITIONS. People will rent a house if they can't afford to buy one. You want to increase the amount of workers sigh increase the amount of rentals on the market.

We need an econ 101 professor from CU or CSU to remind the city council about basis economics. They've clearly forgotten and made themselves "God" of affordable housing. It's simply not working and the numbers I've read recently prove it.

0

ThreeJobs 6 years, 2 months ago

It's a failure. We don't have to wait around for a year to see that no one is standing in line to sign up. I guess they didn't think we would see the hook in this "free" lunch.

SURPRISE! Having a lower paying job doesn't necessarily translate to being STUPID! Why would anyone want to be tied to a deal like this? Think about it. The income vs price ratio is totally out of wack. You can't pay for a 300K property on 77K gross a year and live in Steamboat--not with the prices of everything else--even if you were stupid enough to want to try. Where is the benefit?

Meanwhile the developer keeps paying the interest and carrying cost which will drive prices up. I know there are some who don't think that a developer is entitled to make money. How many who think that are working for free? (Note to Stevie, the longer it takes to sell something the higher the price must be for the seller to make a profit) The competition restricts profit. When you have the socialist dictating policy to control the market and profit we all loose.

The socialist dictators on city council have severely restricted the rental market. More rentals would help an much larger group than this limited "ownership" scheme.

So why aren't rentals being built? Because the city council has made it impossible to do it and make a profit by severely restricting available land and it's use. Until this changes, nothing will change.

0

katrinkakelly 6 years, 2 months ago

Thank you Steamboat Pilot for adressing this issue. I was upset with the removal of my post on the illegal housing (garage death) but you have made it all good now!

0

thecondoguy1 6 years, 2 months ago

katrinka, I would have loved to read your post regarding Davids death, sorry I missed it. Maybe you could tidy it up a bit and get us the jist here. lots of luck at all you do..........

0

id04sp 6 years, 2 months ago

Landmark?

Hey, the "Death Valley National Monument" is a landmark too, but who'd want to live there?

The economics of rental units versus construction costs and land values simply do not support investment in apartments, period. If you've got the money to invest, you can make more by investing in tax-free municipal bonds and not have the hassle of trying to collect rent after you get the place built.

I know several people who make part of their income from rental properties, and in every case, they are making money. Why? Because they bought places that allow them to have income from the rent instead of simply servicing the debt. Oh, and, none of them own property anywhere near Steamboat.

When a developer gets to a certain point, and cannot meet his debt, he can file for bankruptcy and pull out, leaving the project behind for others to finish if, and when, it becomes profitable. There were condos sitting around unfinished for years in the mid-90s because of situations like this.

The thing is, when the developer is a corporation, the corp can pay its employees for their time and labor using income from the units they DO sell, or deposits on units under construction, etc. When the business goes under, the corp simply files for bankruptcy, the employees go to another job (including the developer's CEO who has been paying himself a salary all along), and the creditors are left with the problems. It's very common to find developers with a string of bankrupt corporations left behind in various cities and towns where they started a project, took their profits up-front in salary and benefits, and then had to face foreclosure, and bankruptcy, and so moved along.

The thing we are most likely to see is a work stoppage on the undersold properties, bankruptcy by the developers (notice they didn't build the "affordable" units FIRST!), and an eventual liquidation years down the road. Becoming rental units somewhere in-between just doesn't make sense economically for an investor, so they'll eventually have to be sold as market-price condos in 5 or 6 years.

0

Steve Lewis 6 years, 2 months ago

We all agree that long-term rentals aren't being built. Id has described the reason well - rents no longer pay for a Steamboat mortgage. We also see appreciation/speculative ownership profits have begun to outweigh rental income in the local pro-forma. That may all be self-correcting now?

Economics are behind the rental shortages, not city council. I simply cannot see the case of council causing rental shortages. 3jobs, maybe you can be specific on your rationale? -Steve Lewis

0

ThreeJobs 6 years, 2 months ago

Lewi and others,

OK, here's how it goes. Prices here are largely the result of escalating land costs. The city council has restricted the quantity and use of land . The city buys broken down motels and trailer parks instead of partnering with a developer to build rentals.

The city council has the ultimate power to reduce land cost for a venture like this by annexation or purchase. Just what are they doing with all the "in lieu and linkage" money? Obviously city council never did a "reality check" on their socialist ownership scheme or considered what would work best for the majority.

0

Zalobar 6 years, 2 months ago

This goes for anyone who relies on socialistic Handouts. It will backfire sooner or later. Overpaid leaders suck the life out of the primary intent while making it against the law for us to create solutions privately.

http://by121w.bay121.mail.live.com/mail/ReadMessageLight.aspx?Action=ScanAttachment&AllowUnsafeContentOverride=False&AttachmentIndex=0&AttachmentDepth=0&FolderID=488e4b4e-abda-427e-b256-f26e509323f9&InboxSortAscending=False&InboxSortBy=Date&IsMessageSafe=True&MessageCodePage=20127&ReadMessageId=59e4dee8-7a87-4010-ab26-8719bae0bdbc&n=272628462

http://by121w.bay121.mail.live.com/mail/SafeRedirect.aspx?hmtg=http%3a%2f%2f207.46.10.121%2fatt%2fGetAttachment.aspx&hmqs=file%3d15d2ba0a-fe1f-411a-8ed9-8c9918d3bef2.jpg%26ct%3daW1hZ2UvanBlZw_3d_3d%26name%3daW1hZ2UwMDEuanBn%26inline%3d1%26rfc%3d0%26empty%3dFalse%26imgsrc%3dcid%253aimage001.jpg%254001C8DA7F.A6B412A0&oneredir=1&ip=10.1.106.219&d=d354&mf=0&dialog=1

0

Steve Lewis 6 years, 1 month ago

Threejobs, Yep, the land cost is a function of supply, which is 95% built out in city limits, and annexations limited to within the UGB. I don't think zoned uses are much of a culprit, because its less attractive to mix uses. Also there is good rationale for planning "x industrial" per the whole.

We still disagree that "council did it", because I think the UGB is generally supported by the community and not simply some mistake by city council.

And the requirement of 20% affordable housing out west supports your rational - the free market shifts up in price. If the affordable is smaller stuff, and goes for 50% of market, the free market shift might be 5% to cover costs. Still not a CC policy as it came from a joint vote of 4 bodies: CC, BCC, and the two planning commissions. -Steve Lewis

0

btheball 6 years, 1 month ago

Let's put the UGB proposal(s) to a vote so we ("I think" Lewi) no longer have to speculate IF the community supports it....?

0

Steve Lewis 6 years, 1 month ago

btheball, The UGB came out of the SS Community Area Plan that was well vetted by the community in many, many public meetings. -Steve

0

Requires free registration

Posting comments requires a free account and verification.