If you’ve been a reader of this column for very long, this might sound familiar: like the infamy of December 7, 1941’s bombing of Pearl Harbor, so too was February 2010 infamous for the near collapse of the local real estate market. Now, it’s a full decade past that cold, bleak, winter month when the entirety of North Fork real estate sales totaled just $55,000 – a fact almost incomprehensible to those who didn’t experience it. The market was dead, kaput. In stark contrast, January sales this year are over $3.5 million with more properties scheduled to close by month’s end (but after copy deadline) – about on pace with last year. At the risk of mixing metaphors, you could say it’s “steady as she goes” with no sign of icebergs on the horizon.
It’s apparent to me that unexpected calamities such as these leave scars – infecting our psyche and spawning fear that it might happen again. Raise your hand if you’ve recently wondered aloud “when is the stock market going to crash?”… or the real estate market, while at the same time both are thriving, even setting new records. Similarly, it was the “crash” of Paonia’s water system last year which precipitated a vote to place a moratorium on the sale of water taps. Apparently enough people were traumatized by not having water in their homes for days on end, and are afraid of the possibility that it could happen again, to pass the measure. As the pre-election debate unfolded on Facebook, I read a post asserting that “prices have already started to drop” in Paonia. Not so. And, a number of folks have asked in passing how I think the moratorium will affect the local real estate market. Lacking a crystal ball, I suppose the good old rule of supply and demand might be helpful to divine a reasonable expectation. If we were in the middle of a building/development boom, the effects would surely be bad. But we’re not. According to the folks at town hall, there were about ten taps sold for use in town last year and another few out-of-town (in part because there were already strict limitations under which taps could be sold outside of the municipal boundary) – in short, there isn’t a huge level of demand. On the flip side, there could be tremendous property devaluation were the town to get a reputation for running out of water. Regardless, if the stay is short-lived, the effects will be negligible. However, if the engineering report mandated by the ordinance determines that the town’s water obligations already exceed the system capacity, then it will be a long and expensive endeavor before new taps could be sold again. A prolonged period of zero tap supply/no growth would inevitably drive up prices. Thankfully the town has already hired a firm to conduct the analysis and hopefully will have actionable information in the coming months. Barring a disaster, this should prove to be a useful pause and an opportunity for the town to regain credibility and build confidence within the community.
I never expected to quote Facebook in a column, let alone twice, but, like it or not, I suppose it’s our virtual town square. Scrolling through my feed, I noticed a post headed “Family Home for Rent” which on the surface may not sound bad, but is actually a violation of the Fair Housing Act. The Act was signed into law by L.B.J. in 1968 to combat discrimination in housing (including rentals). In Colorado there are protected classes for race, color, religion, creed, national origin/ancestry, sex, disability/handicap, sexual orientation (including transgender status), marital status and familial status (children under the age of 18 in the household). And, while the ad was promoting the home as a good one for a family (not discriminating against tenants with children) the use of the word “family” is verboten. Who knew, right? I believe that owning a home as an investment, renting it, and being a landlord is a good way to make your money work and build wealth. It also comes with a set of responsibilities, non-discrimination being one of the easier to fulfill. But the list has become longer. Just last year the Colorado legislature passed HB19-1106 regarding rental application fees, HB19-1118 regulating the time period to cure lease violations, HB19-1328 pertaining to bed bugs, and HB19-1170 the Tenants Health and Safety Act which establishes a warranty of habitability coving items such as mold, appliances, waterproofing, windows, plumbing, running water, hot water sewage disposal systems, heating facilities, electrical/lighting, common areas, rodents or vermin, railings, door locks and security, and more. Anyone who owns rental property should want it to be maintained in good condition to protect their investment. These are all good things to keep in mind before deciding if you’re going to hire a professional property manager or do it yourself.