Buyers take plunge at First Tracks
Deed-restricted development has 12 new homeowners
By Tom Ross (Contact)
Sunday, August 24, 2008
Flat market a tough sell
Resort Ventures West Development Manager Mariana Ishida and Director of Sales and Marketing Kerry Shea don’t quibble about the fact that they would like to see more of First Tracks’ studio, one-bedroom and two-bedroom condos go under contract this winter.
Despite their efforts to educate prospective buyers about the financial implications of purchasing a deed-restricted home, they feel there is significant hesitancy based on feelings of uncertainty.
Steve Gadbois, who owns a one-bedroom home at First Tracks, said he expects to benefit from modest appreciation in his condo — deed restrictions cap annual growth at 3 percent — but he also assigns significant value to the fact that he will be able to leave his children a condo at the base of Steamboat Ski Area.
“I won’t be leaving them a trust fund,” he said.
Uncertainty about deed-restricted housing as a business proposition isn’t the only factor holding back buyers at First Tracks. Ishida and her colleagues acknowledged during an interview in June that the gap between prices for deed-restricted condos at First Tracks and market-rate condos and townhomes nearby isn’t sufficient to really stimulate interest in the affordable units.
Ishida said pricing of the deed-restricted units is complex and varies with household size and percentage of the area median income for those different households. However, for purposes of comparison, she uses a 1,140-square foot, two-bedroom unit, where she assumes three people will live. At 80 percent AMI for a household of three — $51,475 — the two-bedroom units are priced at $213,000. For a similar-sized household making 100 percent of the AMI, or $64,350, the price is $266,000. At 120 percent AMI, or $77,200, the price jumps to $319,000.
A family of three earning $77,200 could shop for a 920-square-foot Whistler Village townhome with a remodeled kitchen and hardwood living room floor, currently listed at $322,000. That home is more than 200 square feet smaller, but for $3,000 the buyers would know they could participate fully in equity growth in Steamboat’s resort market. Since June, prices for similar units in Steamboat have remained flat or even gone down. The gap is not widening.
Steamboat Springs — After nearly 20 years of life in Steamboat Springs, Rene Mattone had begun looking for a job elsewhere when the opportunity to buy an affordable condominium at First Tracks presented itself.
“Owning my own home is important to me, being a prior homeowner,” she said. “Renting on a continuous basis is not OK for me. I’m 51 years old.”
First Tracks is a deed-restricted affordable housing project that resort developer Resort Ventures West was required to build by the city of Steamboat Springs as a condition of approval for the larger, market-rate project known as Wildhorse Meadows. Wintergreen Homes and Powerhoursing Real Estate are partnering in the development of First Tracks. Wintergreen developed the successful Villas at Walton Creek and Quail Run projects.
Resort Ventures West conducted its first contract-signing event with 12 qualified buyers Aug. 15 at its downtown sales office. In aggregate, the homes represent $2.3 million in sales.
Buyers at First Tracks must meet income requirements based on household size to be eligible to purchase. A 1 percent deposit is the only down payment required.
In addition to Mattone, the buyers include a bank employee; a manager for a large resort property management company; a radio personality; two employees of the national outdoor clothing brand, SmartWool; an executive chef; and two ski instructors who work in other industries during the spring, summer and fall.
Mattone is a collections investigator for the Colorado courts system. She previously owned her own home and later sold it to move in with her husband after they married. She divorced and found herself back in the rental market.
Despite that she likes her rented home, owning was a matter of pride and self-identity. And she recently had learned her adult daughter and son-in-law were relocating to Steamboat. But after looking for a new home she could afford to purchase, she’d nearly given up.
“It was more than I could do,” Mattone said. “I was already beginning to look at jobs outside Steamboat when I heard about this project.”
Despite that she calls the Yampa Valley paradise, she was resigned to the possibility her best option as a state employee was to consider government jobs posted in other Colorado cities.
Nailing down a home
The first phase of First Tracks, comprising 47 condominiums in two buildings, represents the first affordable homes due to be delivered to the market as a direct result of the city’s inclusionary zoning ordinance.
First Tracks, about to go vertical just east of the Tennis Center at Steamboat Springs, is due to be completed in May or June of 2009, RVW Development Manager Mariana Ishida said.
The project must be completed before her company can close on the luxury condos nearby in Trailhead Lodge. The first phase of First Tracks satisfies the affordable housing requirements for Trailhead and The Range single-family subdivision. Two more buildings at First Tracks have been approved to meet affordable housing requirements for later phases of Wildhorse Meadows, including townhomes and another lodge/hotel.
Steve Gadbois, who manages six vacation condominium projects for Mountain Resorts, said his new one-bedroom condominium at First Tracks wouldn’t be the first home he has owned during his nine years here.
“I owned a three-bedroom, 2 1/2 bath home at Walton Village townhomes,” Gadbois said. “But I had a junior in high school and a sophomore in college at the time. I found I was house poor.”
He sold his townhome to help survive the college years, but he was determined to create a permanent place in Steamboat.
“I have a good job. I have a great job,” Gadbois said. “I didn’t come here to ski, but for the lifestyle. I intend to be here.”
‘The person I am’
Jay Allen has spent 13 years working as a commercial painter in the summer and ski instructor in the winter, originally in Michigan’s Upper Peninsula and for the past four years in Steamboat.
Initially, he found that his construction wages in Steamboat afforded him a better lifestyle than he enjoyed in Michigan. But he grew weary of renting a bedroom in another person’s home and the awkwardness of sharing a kitchen. His faith in his decision to purchase a deed-restricted studio condo at First Tracks for $164,500 was buoyed this week by his landlord’s announcement that his rent would be raised from $500 to $600 because of increasing utility costs.
“I’m pysched to be where I’m at,” Allen said. “I’m excited to be close to the mountain, and it will be exciting to watch it go up and be a part of it. I don’t want to be paying the man $600 a month and not 100 percent feeling like the person I am, living under someone else’s roof.”
Wildhorse Meadows will feature a people-mover gondola that will ferry residents from its location adjacent to Pine Grove Road up and over Mount Werner circle into Gondola Square.
Gadbois agreed with Allen that quick access to the base of the ski lifts via the gondola is a notable amenity for the affordable housing project.
Mattone said she values the quick access to the Nordic skiing trails at the Steamboat Ski Touring Center a mile away. But she also appreciates that Resort Ventures West is providing its affordable housing within its market-rate housing. And she said she thinks more Steamboat residents would consider buying at First Tracks if they fully grasped the opportunity.
And then there is the pet factor. All three placed strong emphasis that their dogs and cats are welcomed home at First Tracks.
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