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Summit County Short Term Rental Rules (February 2023)


Summit County Short Term Rental Rules (February 2023)

Summit County Short Term Rental Rules (February 2023)

Video Transcription

Summit County Colorado’s short-term rental rules just changed again and these new changes mean that it could be as long as 10 years in some areas before you’re able to get a new short-term rental license. In this video I’m going to go over what those changes are and at the very end of this video I’ll go over how I think they’re going to impact our real estate market. On February 15th of 2023 The Summit County Board of Commissioners passed their final vote to put these new short-term rental regulations into place. 

Here are the new rules. There are two overlay zones: Resort and Neighborhood. Resort areas really didn’t see much change from the rules that we had before and have the least restrictions. They are not limited on the number of licenses to be issued and they are not limited on the number of bookings or nights per year that they can use. The only restriction that exists is on nightly occupancy which is set to two per bedroom plus four which means that in a two-bedroom unit you could sleep eight. The resort zones are as follows: Keystone, Copper, and the small area is in Breckenridge that happened to fall within the county. 

The other zone is neighborhood zone. The neighborhood zones incorporate anything that falls outside of those Resort zones and outside of the Incorporated towns in the county. This is most of the neighborhoods in the county and the neighborhood zones are where we see the most restrictions have been put in place. The county did away with type 3 license which was meant to be used for people who were running short-term rentals as a business and had the least restrictions. Type 3 licenses will no longer be available. 

The two types of licenses that are still available are type 1 and type 2. Type 1 is available for local residents on their primary residence but they have to meet the qualified occupant rules. The requirements to be considered a qualified occupant: you can click this link for the full rules on if you would be able to qualify for a type 1 license. Most people meaning everyone who is not a member of the local workforce would be able to apply for a type 2 license. Type 2 licenses and type 1 licenses do share some restrictions that being they are limited to 35 bookings per year. This is not a limit on the number of nights per year you can rent, you can just not rent to more than 35 individual bookings. 

The second restriction is the neighborhood zones. If you’re applying for a type 2 license have a cap on the number of licenses that will be available. Type 1 licenses are being considered an exception to those caps so they would not add to those numbers. Occupancy is the same that it was before the moratorium in the neighborhood zones which is two per bedroom plus two. So a three bedroom home could sleep eight. One thing to keep in mind is that the size of your home. If you’re on septic is set by the size of your septic system not by the number of bedrooms in your house. So just because you added a fifth bedroom if your septic is still sized for a four bedroom you would have to only consider and advertise your home as a four bedroom. These caps that were put in place on type 2 licenses are where there was the most contention and where we will see the biggest impact for people who are looking to purchase a home and potentially on our real estate market. As a reminder stick around to the end that’s when I’ll talk about how I think these changes are going to impact our market. 

Overall in the neighborhood zones of the unincorporated parts of the county as of Q4 of 2022, 17% of homes held short-term rental licenses. The percentage varies widely by Basin and these caps are set by Basin. The basins are as follows Snake River Basin, which includes Dillon Valley and Summit Cove. 10 Mile Basin which includes the areas outside of Frisco Town limits. Lower Blue Basin, which is Silverthorne, and Wilderness, and upper blue Basin which is basically everything from Lake Dillon to Hoosier pass outside of Breckenridge and Blue River Town limits the Caps that were put in place were based on what the county took into consideration as who currently lives there how many rentals there currently are and how much they’re working to preserve the characters of those individual neighborhoods. Upper Blue Basin had the highest percentage of short-term rentals prior to these new restrictions and has the highest caps. Upper blue Basin will have 590 licenses available compared to the Lower Blue Basin which will have 550. The 10-mile Basin is set to only allow five percent of units, and this is down from 31 licenses down to 20 licenses. 

So when will new licenses be available? These projections vary based on if you talk to the county or if you talk to Realtors who are looking at sales data. The county took sales data and what they estimated projected renewals of short-term rental licenses to be. And Realtors we looked at sales data. Where I think we differ from the county is I think the number of non-renewals of short-term rental licenses is going to drop from what we saw historically. Because previously if you non-renewed you could get your license back if you wanted it versus now if you let it go you’re probably not not getting it back for a while. The county is projecting between two and five years depending on where you are in the county to get a new license. Where if we only look at sales data it will be anywhere from 3 to 18 years depending on where you are in the county. Upper blue Basin which incorporates the largest area of the county we’re looking anywhere from three to six years. The county currently does not have a wait list in place unlike Breckenridge where you can get on a wait list for the areas where they’ve already met their caps the county isn’t going to start a wait list until the number of licenses gets within 10 percent of these new caps. And the idea behind this is that if it’s going to be years and years until someone can get a new license the county didn’t want to maintain those wait lists until we got sort of within Striking Distance. 

So what about the existing licenses? If you hold an existing short-term rental license in one of the neighborhood zones you will have to meet the new restrictions on the 35 bookings per year as of your renewal in 2023. Those 35 booking things per year the county is going to count from October 1st through September 30th of each year. So all short-term rental licenses in the neighborhood zones will have to comply with that restriction by October 1st of 2023. An important thing to keep in mind in case you’ve already started scheming loopholes is that licenses are not transferable upon sale. The county did put in place some restrictions to be able to transfer between family put a property into an LLC so long as the principal owner of the property is the same before it’s put in the LLC and after for divorce death and for title corrections. But anytime there is consideration I.E money that changes hands it would be considered a sale and the license is not transferable. So what do I think this is going to do to our real estate market? We actually have already had a peek at how these restrictions are going to impact us because all of these areas were under a moratorium for new licenses starting in May of last year. And here’s what we saw happen with these restrictions on so many homes in the county we saw demand for homes that had short-term rentals condensed to the Incorporated towns. And what this did is it drove up prices in those Incorporated Towns at a faster rate than the county average. For example the county averaged about 13 appreciation in 2022 but the town of Blue River where you can get a short-term rental license averaged 40 percent appreciation in 2022. And I think we’re going to continue to see this trend happen we may not see quite that big of a difference between 13 and 40 but I do think the areas where we’re able to get short-term rental licenses are going to appreciate faster than the areas where you cannot get a short-term rental license. As of yet we haven’t seen enough sales to really say that home values have gone down in the areas where you can’t get a short-term rental license. Partially because in 2022 the moratorium went in place about the same time the interest rates went up so it’s hard to pin down causation on that. But I think by the end of 2023 we will have a better read on how much this impacts home values in the areas where you cannot readily get a license. If you are looking to buy in Summit County and are interested in being able to short-term rent or that’s important for you to be able to do in order to make this purchase happen I can set you up on a search that is exclusively in the areas where short-term rental licenses are still available. Additionally please like And subscribe to this channel because the next video that I’m going to put out is going to go over the rules on the county as a whole now that we’ve gotten through all of these changes so you don’t have to go watch this entire short-term rental playlist and try to piece together which parts are still active and which parts have been overruled because of new changes. As a reminder all of these changes are immediately in place out of February 15th the moratorium was supposed to go until March 23rd but these new rules were put in place on the day that they were passed. I’m Betsy Repaske a realtor here in the mountains of Colorado if you’re concerned with how these changes is over to impact your home purchasing plans or if you already own a home how they impact your home value you can find my contact information and links for setting up a home search or getting a home valuation in the description below.

Read The Full Summit County Ordinance:

Watch the Video on Breckenridge’s Short-Term Rental Rules:

Schedule a Buyer Consultation to set up a custom search to search for properties that CAN be short-term rented:

Find out how these new STR rules have impacted your Summit County home value:

Reach out with any questions: ‪
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