Colorado ski real estate doubles, will there be a drop on the other side? 5 factors that will shape the future
The amount spent on real estate in six of Colorado’s resort-anchored counties doubled from 2019 to…
Gunnison county, home to Crested Butte ski resort, issued an order banning non resident visitors and homeowners from remaining in the county during the pandemic. This is the first city in Colorado and possibly the country to ban property owners. Furthermore, Clear Creek county, home to Loveland, Idaho springs, etc… implemented a ban on nonresidents traveling on county roads. Why is this so important? Is this legal?
Gunnison/Crested Butte ski resort what happened and why?
Gunnison county is a small rural county in Colorado home to the world class Crested Butte ski resort which is owned by Vail Resorts, the largest ski operator in the country. Like many of the ski resorts throughout Colorado, second homeowners have flocked to these towns to ride out the pandemic. Each resort community is facing issues of greatly increased populations due to non-residents in their communities. Gunnison County issued an executive order (below) effectively banning any non-residents from the county including second homeowners. The banning of property owners is the first order I have seen in Colorado and throughout the country and raises interesting questions about property rights.
These amendments also prohibit all non-residents, including non-resident homeowners, from remaining in Gunnison County during the duration of this Order. The Public Health Director finds that non-residents, visitors and non-resident homeowners from lower altitudes are at a greater risk for complications from COVID-19 infection than residents, who are acclimatized to the high altitude environment of Gunnison County. The Public Health Director also finds that non-residents, regardless of whether they own a residence in Gunnison County, are imposing unnecessary burdens on health care, public services, first responders, food supplies and other essential services. Such persons are also creating issues with regard to enforcement of Gunnison County’s public health orders. Accordingly, the presence of non-residents and visitors, including nonresident homeowners, is no longer permitted in Gunnison County in order to maintain public health and safety and to continue to address the COVID-19 pandemic
Clear Creek County, a small front range county on the west side of Denver home to Idaho Springs, Georgetown, Loveland, etc.. has restricted access on all county road to only residents. Clear Creek county like many mountain towns has had significant visitation after the stay at home orders were implemented. Many Denver residents have flocked to the mountains to back country ski, hike, climb, and recreate in the outdoors. The blocking of county roads effectively bans 2nd homeowners and also restricts access to various national forest trailheads.
The use of road blocks, traffic control devices, signs, and other measures shall be taken to restrict access to Clear Creek County roads by non-residents
The Texas letter, lawsuits to follow
Many second homeowners in Colorado ski towns are Texas residents and the Texas Attorney general did not take fondly to the ban of Texans by Gunnison county. Below is an excerpt of the letter the Texas attorney general wrote to the Gunnison county health department.
The Order violates the Constitution by banishing nonresident homeowners from Gunnison County for the duration of the Order, depriving them of important rights. It discriminates against nonresident homeowners by entirely prohibiting their ingress to the county and enjoyment of their real and personal property in the county. Resident homeowners, on the other hand, are under no such prohibition.
Impact on Real Estate
Gunnison and Clear Creek county prohibitions on non-residents raise interesting legal questions that will result in various lawsuits that will ultimately be decided by the Supreme court. How the supreme court rules will have a longstanding impact on property rights not just in Colorado, but throughout the country. This could also impact property values. If pandemics become more common, and states and counties restrict access to non-residents, who will want to buy property in the area if they can’t visit/utilize it.
Long term impact
The Coronavirus has exposed a major conflict in America. We are a very mobile society, freely crossing among states, counties, etc… The virus is testing the ability of free movement. For example, ironically, Texas is barring the entry of residents from Louisiana and Florida is barring the entry of residents from New York. Furthermore, the president is talking about opening up sections of the country at a time, how do you limit movement among sections that are open versus sections that are closed? The supreme court will ultimately decide the extent of property rights; there will be lasting impacts for resort communities not only in Colorado but throughout the country.
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Written by Glen Weinberg, COO/ VP Fairview Commercial Lending. Glen has been published as an expert in hard money lending, real estate valuation, financing, and various other real estate topics in Bloomberg, Businessweek ,the Colorado Real Estate Journal, National Association of Realtors Magazine, The Real Deal real estate news, the CO Biz Magazine, The Denver Post, The Scotsman mortgage broker guide, Mortgage Professional America and various other national publications.
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