Short term rental regulations 2021

As many may be aware, the Summit County & Town of Breckenridge Council has been planning to impose short term rental rental restrictions since back prior to the Covid-19 pandemic. If your property is located in either jurisdiction it's important to understand the changes as these restrictions could come with negative effects for the entire real estate community. Here we will summarize  both jurisdiction's suggestions and timelines along with the potential impacts that may result.

 

Please note that as of today, Blue River and Alma have not announced any changes.
 

Town of Breckenridge STR Regulations


Research
If you would like to research these restrictions on your own, the following links will be helpful to get you started:

 

Summary of Proposed Actions

The major action proposed by the council is to place a cap on the number of short term rental licences within the Town of Breckenridge at 2,200. Currently, Breckenridge holds 3,900 short term rental licenses of which 1,500 licenses are considered of exempt status. For example, the exempt licenses would include Main Street Station and Beaver Run which are condos that act more as hotels according to the Council. The 2,400 non-exempt short term licenses are the concern of this legislation.

 

So, how do we get from 2,400 licenses down to 2,200 licenses? The council believes this number will naturally regress over time back down to 2,200 by restricting the permitting of new licences. When the legislation goes into effect, any new homeowner, who plans to short term rent, will be put on a waiting list. The waiting list will be first come first serve rather than a lottery. All existing license owners will be grandfathered into the legislation. However, when an owner decides to sell their home, because the license is attached to the owner (a natural person, not an entity) and not to the property, the new owner will have to re-apply for a license which puts them at the end of the line.

Until this legislation is put into effect, homeowners are allowed to apply for short term licenses as normal. Most expect for there to be a big push to get licensed before this goes into effect. 

 

The goal of these restrictions is to push more homes to become long term rentals for locals who are struggling with increasing rent caused by limited housing due to short term rentals and also to bring Breckenridge’s back a culture which Council members think is being eroded away.

 

What’s All That Mean

As you can imagine, the line for licensure will be a long one. Existing license holders will likely hold onto their licenses until they are ready to move on from Breckenridge. 200+ existing licenses will need to expire naturally before the waiting list goes into effect. This will likely take years. Essentially all new home owners will be prohibited from short term renting. In our opinion values will drop without the extra investment incentives. Existing homeowners will lose value overnight and home buyers will look elsewhere. As the Summit Allegiance of Vacation Rental Managers puts it, “Instead, (these homes) will be sold to the uber rich who can afford to leave the property vacant most of the year when they aren't using it; Breckenridge will become a ghost town.”


To add to the real estate depreciation potential job loss, small business success, and visitor count could all be at risk due these restrictions.

As for short term rentals, there is the chance of existing short term rentals to see increased rates by the restrictions. If you are fortunate to be grandfathered into these restrictions you could see higher rental revenue over the coming years. 

 

What’s Next

The Town Council is scheduled to meet on Tuesday September 14th where they will read the first drafts of the new legislation. At this meeting they will hear more comments to take into consideration.

On Tuesday September 28th, the Council will meet again to read the legislation a second time. From there, there will be a 35 day period ending on November 2nd when the legislation will officially go into effect. 

 

Take Action

If you are wanting to show your support against these actions, here are some things that you can do:

 

  •  Attend Upcoming Town Council Meetings - Meetings are held at the Town Hall Auditorium every 2nd and 4th Tuesday of the month. Attend, ask questions, and be heard! If you can not attend in person, you can attend via Zoom. Do note, if you are attending virtually, they do not allow for you to ask questions. In that case you can email the town at mayor@townofbreckenridge.com

  • Sign the Summit Alliance of Vacation Rentals (SAVRM) petition against these changes and the Breckenridge Town Council - Sign Here

Summit County STR Regulations

Research

If you would like to research these restrictions on your own, the following links will be helpful to get you started:

Summary of Proposed Actions

Summit County's approach is different than Breckenridge's. The County understands that a blanket and generalized approach is not helpful and does not plan to impose any STR cap on licenses. Instead, they plan to draw "opportunity zones" based on data survey's they have recently sent out. These zones will have incentives to encourage property owners to long term rent their properties instead of short term rent. September 7th's meeting was the first of a series of discussions about this so nothing has been proposed yet, just rough ideas have been given.

The goal of the regulations are also more concrete that the Town of Breckenridge's -- to create affordable housing for the local workforce. The County council understands that imposing any restrictions on single family homes wouldn't make sense as generally, locals cannot afford to pay an annual rent at these properties. Therefore, single family homes will not see any restrictions. We will get more clear language about this soon.

Lastly, the County is voting on whether or not a moratorium should be instituted for 12 weeks while data is being collected.

What’s All That Mean

This seems like a more reasonable approach to the housing problem than Breckenridge's approach, but we are not sure what the incentives will be yet exactly. They could be property tax based which would affect the real estate market, but not the drastic disruption that a STR license cap would cause. For now, we'll have to wait and see what the council will propose.

What’s Next

The Town Council is scheduled to meet on Tuesday September 14th where they will discuss voting on a license moratorium. After this, sometime in early October, they will go over the data they have collected and discuss their ideas on incentivizing owners to long term rent.

Take Action

If you want your voice heard or if you have any questions you can email the County at str@summitcountyco.org.

 

Please register here for future Zoom council meetings.

We’re here to help

If you have any questions, we are here to help. Please feel free to reach out to us via our email at info@breckmountainmanagement.com or by phone at (970) 423-2220.

We will do our best to keep everyone informed throughout this process. Please check back here for periodic updates.
 

 

- The Mountain Management Team


 

Updated: 9/8/2021