Brent Boyer

Brent Boyer

Brent Boyer: A story that impacts us all

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Brent Boyer

Contact Editor Brent Boyer at 871-4221 or e-mail bboyer@SteamboatToday.com.

— In June 2004, after a year and a half of living and working in Steamboat Springs, my parents helped convince me that there was no better investment than real estate in a Colorado ski town. They were right.

Less than three years later, using the equity from my base area condominium, my wife and I had enough money for a down payment on a free-market, single-family home in West End Village. We signed off on an interest-only, seven-year, adjustable-rate mortgage to buy as much house as we could.

Our story should sound familiar, as it is shared by so many Routt County residents who squeezed their way into the real estate market in the middle part of this decade. And why wouldn't we? For several years, there wasn't a better investment out there than Steamboat Springs property.

Locals weren't the only ones trying to get a piece of the market. As retiring baby boomers with money to spend sought homes in desirable locales like Northwest Colorado, the buying frenzy shattered previous real estate transaction records - surpassing $1.5 billion in 2007 in Routt County. Major development firms from across the country gobbled up property here to capitalize on the out-of-control demand for luxury mountain resort residences.

Then the bottom fell out, and with it went tourists, sales tax revenues and jobs.

On Friday, the Pilot & Today will unveil Part 1 of a five-part series titled "House of Cards: The rise and fall of Routt County's real estate economy."

Five reporters, three photographers, three editors and a designer have spent the past couple of months planning, reporting and writing this in-depth look at the buildup and subsequent fallout of the real estate-driven economy.

To be clear, the series does not seek to assign blame for what we've experienced during the past couple of years. Rather, it's simply an honest accounting of how we got to where we are today, how people are dealing with unexpected challenges and, finally, when and how we could emerge from the recession. The series incorporates the perspectives and personal experiences of everyone from Realtors and lenders to small-business owners, homeowners, the local work force, government officials and economic experts.

By definition, a house of cards is a situation that is shaky, or in constant danger of collapse. Many of us bought into the idea that Routt County was immune from external forces and that the value of our properties would continue to escalate at unprecedented levels. In hindsight, it's easy to see how unsustainable that buildup was, exemplified by the subprime loans and risky financial decisions so many residents and investment property owners made. Hence, the house of cards.

I encourage you to take a look at our first installment Friday. I think you'll look forward to parts 2 through 5, appearing each Friday through Aug. 28. The series will be online at www.steamboatpilot.com/houseofcards.

Comments

Jamie Morgan 4 years, 8 months ago

To quote Pee Wee Herman "I don't need to see the movie...I lived it". :)

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aichempty 4 years, 8 months ago

Of course greed is part of the story.

There's another one too; "There's a sucker born every minute."

We signed off on an interest-only, seven-year, adjustable-rate mortgage to buy as much house as we could.<

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seeuski 4 years, 8 months ago

Was it greed or demand? I have never met anyone who sells things for less than someone is offering. I doubt LTFO has ever walked up to a stranger and given away his paycheck. I guess the answer to greed would be Socialism. Let the Government decide who is worthy. What occurred here was the perfect storm. You had an election, a subprime mtg collapse, baby boomers buying retirement homes, young couples wanting a better life here and lending that offered loans to people who normally would never qualify. The market was flooded with Buyers and the Sellers were not greedy but smart. Many cashed out and bought elsewhere. We hit the end of a ten year cycle that will not repeat itself in the expansiveness of its devastation as the variables were exhausted in this one.

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JLM 4 years, 8 months ago

It's called "life".

You see things, you want things, assess risk, make decisions, live with the results and sometimes suffer consequences.

Sometimes the outcomes of our decisions are very good and sometimes they are not so good. You live and learn and make better decisions in the future.

Be happy we live in a country wherein you can make such decisions and own a home.

Some short period of time from now, SBS real estate will be red hot again --- what will you decide then? What have you learned?

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mavis 4 years, 8 months ago

JLM -- I agree with you but unfortunately with the Bail outs those that did these loans probably won't learn that they shouldn't have tried to get as much house as they could with interest only loans and so on -- and those like me that are waiting for traditional loans with a substantial amount down and desperate to not get in over our heads should have just got in over our heads and this new government save the day program would have saved us- Thats the problem aich is right and people like me are paying these high taxes to support their mortgages

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ybul 4 years, 8 months ago

Maybe, the federal reserve who sought to keep interest rates low to keep the economy going, the foreign governments who sought to have the lowest cost of production and manipulated their currencies down are also to blame with cheap credit.

Maybe, the federal government with its desire to put everyone in a home via freddy and fanny are too blame as they guaranteed home loans for banks.

Yes the consumer had a hand in it. But the control of the credit markets by governments and an elite group are probably more responsible.

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inmyopinion 4 years, 8 months ago

Steamboat Pilot- I do not typically criticize, but this series is not covering anything all of us do not already know. I find it a bit disturbing that you would unveil this cover story on the weekend of Wine Fest and the Charitable Luxury Home Tour.

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seeuski 4 years, 8 months ago

inmyopinion, Great point, what good is it to advertise this sad affair? Whatever Buyers may be out there will certainly be turned off by this.

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vanguy 4 years, 8 months ago

In a community whose economy is driven primarily by tourism, in an environment where all of our business owners are doing everything they can to survive, and in a real estate market that just started to show signs of recovery in the past 30 days, a cover page story like this during one of the busiest weekends for summer tourism really doesn't serve the best interests of any aspect of our community, nor the paying advertisers that keep the newspaper afloat.

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greenwash 4 years, 8 months ago

Who are you kidding there is no recovery happening.Facts are facts if it wasnt on the front page you can see it in the classifieds.

Poor Poor realtors.I think I might cry.....NOT

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housepoor 4 years, 8 months ago

inmyopinion, you are right on....it is OLD NEWS!!!!

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Scott Wedel 4 years, 8 months ago

In terms of foreclosures, the local market is not that bad off. In terms of number of sales, it is a total nightmare. Number of transactions is down 80% or so from 2007. It is way slower than any other year since 1998 (which is as far back as the assessor's database allows online searches).

2008 was not really a bad year until the financial crisis of September and October. So while places like Vegas were crashing in 2008, we were still doing okay. Thus, we still have some real serious problems to work out.

Are we to consider ourselves lucky that we just have a huge hunk at the base of the ski area as a vacant lot?

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steamboatsprings 4 years, 8 months ago

There are definatly people going through difficult times right now and it may get a bit worse but if you step back and look at the rest of the country we are very fortunate not only for where we live but in that our foreclosure rate is less than 1 percent and our town is not full of abandoned partially built buildings.

Steamboat will work through this and we will all be better for the experience.

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TWill 4 years, 8 months ago

Greenie-

If you have the best interest of our overall community in mind, you would drop the bitterness towards realtors in this circumstance. Yes, they have made a lot of money for not doing all that much relative to others. But, the real estate market is the core of our local economy(regardless of what profession you may have).

Get some perspective and realize what makes this place tick. If that doesn't make sense to you, then take a look at your trust fund statements over the past 18 months- that just might make you cry.

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greenwash 4 years, 8 months ago

God I wish I had a trust.

I wonder how many realtors actually have a college degree.

Just wondering.

Im not bitter , Im pissed I trusted a couple of these YAHOOS.

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aichempty 4 years, 8 months ago

The mortgage industry took a government mandate to make credit available to more people and used every loophole and get-rich greedy mortgage broker trick that could be fit into it, and the result was the collapse of the mortgage industry. It's just like Alan Greenspan said; he never even considered that the banking industry would act in a way that would harm it.

Human greed was the key to it all. It proves we need regulation of the credit industry.

Next?

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