It’s a renters’ market in Summit County
Summit County, CO Colorado
SUMMIT COUNTY, Colorado –The Summit County summer home rental market has always been fairly slow, but landlords and property managers are starting to become a little frustrated with the crawl of the current market.
“It would be a dream come true to get that off my back,” said Paige Gray of a rental she needs to get off her hands. Gray, a former Summit County resident now living in Taos, N.M., said she has been trying to find a renter for her one-bedroom Frisco apartment since April with no success. She signed a one-year lease on the unit last fall, but lost her job in January. She moved to Taos for a new job and is now looking for someone to take over her lease.
Gray said she has had 10 prospective renters call or look at the unit, but none of them have shown any additional interest for her asking price. The problem is, Gray says she cannot lower the rent any more.
“There’s no option,” she said. “I’ll keep paying it myself and have no money.”
Gray added that her experience was by no means unique.
“It’s just an overpriced market, nobody has any money,” she said.
Gray’s frustration is shared by other landlords and managers around the county. Dave Goffredo, owner of Dave Breck Homes in Breckenridge, has 10 properties he is looking to lease on a long-term basis. He’s had two properties on the market since May and has not been able to fill them
“I’ve had a number of calls, some showings, nothing yet,” he said. “The pickings are slimmer lately.”
Goffredo said he has had to be much more flexible with his lease terms lately. He has had to drop the price on several of his properties, add escape clauses to the leases and in some cases take tenants that may be less than ideal. Goffredo is optimistic though, and said he hopes to have his remaining properties filled by July or August.
Liz Johnson of Colorado Mountain News Media, the Summit Daily’s parent group that advertises real estate around Summit County and the Western Slope, said there have been properties advertised for rent for several months with no results.
“It’s a renters’ market,” said Johnson, who has a property of her own she is trying to lease. “We have people running ads for two or three months if not longer.”
In addition, Johnson said the number of real-estate ads in general is down.
“There’s the same amount of homes for sale, but there are less ads because the market is not moving. Realtors aren’t spending money to get (properties) out there,” she said.
Johnson pointed out that the rental market is tied to the job market. There are considerably fewer jobs in Summit County this summer compared to previous years. For instance, 117 employment ads were listed in the Summit Daily on June 1, 2008, compared to only 15 on June 1 of this year. According to the latest statistics from the Colorado Department of Labor, the unemployment rate in Summit County in April was 5.8 percent, a .7 percent jump from March. The unemployment rate for last April was 3 percent.
However, the number of rental properties available appears to be up. There were 128 rental ads listed in the June 1, 2008 Daily and 208 ads on June 1, 2009.
Johnson attributes the increase to people supplementing their income by renting out whatever space they have. She said the range of landlords runs the gamut of second homeowners trying to lease houses that might otherwise sit empty to tenants taking on roommates so they can make rent that month.
“When employment is tight, there are more rentals,” Johnson said.
Employment is definitely tight right now. Shawn Henrikson started working at the Frisco office of the Colorado Job Force in April and said his first few weeks were hectic.
“There have been days where you had three or four people applying for the same job at the same time,” he said.
Henrikson said the past few weeks have slowed down somewhat, but his days still go by quickly.
“I used to tell people to look in the paper,” he said. “There used to be three pages of job listings, now it’s down to a third of a page.”
As far as short-term rentals go, Mike Magliocchetti, president of Key to the Rockies management company in Keystone, said most lodging companies are down 20-40 percent in their bookings for the summer.
“The biggest thing you can compare it to is the events of 9/11,” Magliocchetti said of the downturn.
Magliocchetti went on to say there are still people looking for rentals, but they are not spending as much. He said smaller properties were in more demand than larger, multi-bedroom units.
“People are still coming, but they’re downsizing,” Magliocchetti said.
David Garrett, co-owner of Ski Country Resorts in Breckenridge, said renters are also being much more conscientious about what they are paying for in a property. Prospective renters are looking for better deals and amenities in rental properties, making property managers and landlords work harder to close deals.
“People are making sure they get the most out of their lodging dollar,” Garrett said.
Jeni Shelton, the other owner of Ski Country Resorts, said they were facing stiff competition this year from alternative vacation spots such as campgrounds.
“They’re going to look at what’s cheapest, and that might be pitching a tent in their own backyard,” Shelton said.
Property management companies seem to be more optimistic about their futures than individual owners.
Linda Burchett, director of sales at Key to the Rockies, said more renters are booking properties within two to three weeks of when they want to come out here. Burchett said this is a change from years past, when most renters would book their properties several months in advance. Because of these last-minute bookings, the rental companies said they’re hopeful they will ride out the season relatively unscathed.
Both Garrett and Magliocchetti said summer rentals make up a relatively small portion of their overall business. They added they would not lose that much money in the long term provided business picked up this coming winter.
“We do as much business over the entire summer as we do over the 10 days of Christmas,” Garrett said. “If we don’t get out of this by next winter, it could be a long winter again.”
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