The current Short Term Rental situation in Summit County

 

The short term rental (STR) `topic in Summit County has been a hot one for the past year or so and current developments mean that this will continue to be the source of discussion and debate for the next 12-18 months. In this article I want to offer the simple fact of where we are and where I think we will end up.

Overview of the short term rental license discussion

As of the 25th May 2022, the Town of Breckenridge still maintains it’s ordinance that was passed last year that caps the total number of licenses at 2200. There are still exempt properties such as One Ski Hill Place, Crystal Peak Lodge, Mountain Thunder Lodge, Village at Breckenridge, that do not count as a part of this 2200 quota of licenses. As it currently stands, if you purchase a property in one of these ‘exempt’ complexes, you will be able to apply for a STR license. All other new purchases are not eligible for a license as the current number of valid licenses far exceeds the 2200 cap. The current wait list for STR licenses is around 35.

The Town of Breckenridge (TOB) is currently discussing a new ordinance that would comprise of 3 zones that would have different densities of STR licenses and as such would have a different ‘feel’ with regards to the neighborhood being ‘tourist orientated’ or ‘primary / second home orientated’. The amount of licenses available in each zone would be quite different. They are now looking to increase the total number of licenses from the capped total of 2200 to a total of 3700. This total of 3700 would however, as it is currently proposed, include the exempt complexes.

Proposed license totals

Zone 1 – 3208 licenses available out of 4010 total units

Zone 2 – 157 licenses out of 314 total units

Zone 3 – 336 licenses out of 3357 total units

As you can see, the area that the TOB is looking to restrict the most is zone 3.

Proposed Tourism Overlay District Map

https://www.townofbreckenridge.com/home/showpublisheddocument/20911/637750744551870000

I think we are trending in the right direction so long as the following three conditions are met

1.     The TOB does not include the exempt properties in the total of 3700 – the exempt properties are truly pure tourist / rental style properties and should be treated as such – always available to rent to guests

2.     There should be a ‘use it or lose it’ policy for licenses that have been issued. There are many licenses that have been issued that are not being used.

3.     There is more flexibility in the zone 3 restrictions

If these conditions are met, my honest opinion is we will get to a position where wait times for a license are very short and the TOB has a very accurate picture of the demand for licenses and how to tailor any restrictions. This would also allow for some more allocation in zone 3 which I think is needed.

 

Frisco and Silverthorne currently do not have any short term rental license caps, although they do require homeowners to apply for a license.

Town of Blue River in Breckenridge requires a STR license but currently does not have any cap or restrictions.

Unincorporated Summit County, which includes Keystone and Copper Mountain, has made changes to their policy as of the 24th May 2022. The County has imposed a moratorium on all new STR license applications. This moratorium will be in effect for 9 months – until Feb 2023. The moratorium does not apply to the resort zones, including Keystone, Copper Mountain, Tiger Run, and Ski Watch and 4 O'Clock neighborhoods in Breckenridge.

 

So the long and the short of this situation is that the following areas do allow short term rental license applications;

Town of Breckenridge – new ordinance in the works and new applications currently subject to wait list

Town of Frisco

Town of Silverthorne

Town of Dillon

Keystone resort overlay

Copper Mountain resort overlay

Town of Blue River

 

I think that the focal point for rentals will be in these incorporated areas and the ski resorts of Copper Mountain and Keystone. Property values will be resilient in the future here and demand will focus on these locations. Until Breckenridge sorts out the ‘limbo’ it is currently in, all other areas in the above list will benefit from Breck’s current cap.

The residential areas outside of the list above will naturally migrate towards a primary home and second home standing. There is certainly an argument for certain areas in the county and certain areas of Breckenridge’s zone 3 benefiting from this. It can be argued that the downtown historic core of Breckenridge will see property values trend favorably as people like the fact that this downtown residential area will favor primary homeowners and second homeowners who don’t want short term rentals in the neighborhood.

In my opinion, the reality of all this is going to take 12-18 months to fully emerge and no doubt the complexion of the real estate market in the county is going to change during this time as demand and values get reallocated based on the STR licensing geography.

by James Shingles

 

Interesting article on the STR situation in Aspen

 

Resource Links

Summit County STR  

https://www.summitcountyco.gov/1221/Short-Term-Rentals

Full Summit County STR Ordinance https://www.summitcountyco.gov/DocumentCenter/View/23986/STR-Regulations?bidId=

Town Of Breckenridge STR Ordinance

https://www.townofbreckenridge.com/home/showpublisheddocument/20704/637697413616900000

https://www.townofbreckenridge.com/your-government/finance/short-term-rentals

Town of Frisco STR Ordinance

https://www.friscogov.com/departments/finance/sales-and-lodging-tax/short-term-rental-license-application-process/short-term-rental-regulations/

Town of Silverthorne STR Ordinance

https://www.silverthorne.org/town-services/finance-administrative-services/short-term-rental-license

Town of Dillon STR Ordinance

https://www.dillonco.gov/business/dillon-short-term-rental-str

 Town of Blue River STR Ordinance

https://townofblueriver.colorado.gov/lodging/short-term-rental