Town holds onto deed restrictions

“That bigger picture isn’t really a picture anymore”

Members of the Mt. Crested Butte Town Council turned down a request to lift the deed restriction on a Pitchfork home on Tuesday, April 3, hoping the decision would stem a potential flood of similar requests from people looking to sell their affordable homes on the open market.

The request came from the property’s owner, a Florida resident who bought the house for her son using his residency status. However, he won’t be able to afford the debt after he leaves the valley this fall.
“I didn’t fully understand the extent of the deed restrictions … and I am in a situation now where I desperately need to sell the property,” the woman said. In a letter to the council, she had already offered a glimpse of her circumstance.
Over the phone she provided more detail, telling the council, “I did talk to a couple of Realtors about putting the property on the market. They explained to me that I was in quite a dilemma because there are so many properties and to even have a chance at a sale—which they said was next to nil and they didn’t even want to take the listing because it would cost them money—I’d need to have the terrible deed restriction I have on this lifted.”
The owner acknowledged the “huge loss” she expected to take by selling the property, for which she paid $395,000 in 2007. “I know I’m going to take a huge, you know, huge loss. But on the other hand I’d like to get as much as I possibly could compared to the other homes out there that don’t have the same deed restrictions.”
The woman said she felt, with the changes that have happened in the economy, especially in the Gunnison Valley, “It’s kind of an unfair restriction on that house.”
Mt. Crested Butte Mayor William Buck acknowledged, given the state of the economy, “It is a difficult situation and you’re not alone. We’re all in a difficult situation to one degree or another.”
Buck added the town had historically never voluntarily lifted a deed restriction on a property, although some had been lost to foreclosure. And, he said, requests to lift deed restrictions aren’t as common as they would be if the precedent were set.
Deed restrictions are the town’s way of making sure housing is available and affordable for the town’s working class, people who might not otherwise be able to afford property in what had been an inflated real estate market.
“I know it can be considered to seem burdensome,” Buck said of the deed restriction, “but when it was put into place it was part of a greater plan. So having no precedent, the council is unanimous on this.”
The owner said, “You mentioned that there was a bigger vision back then. Everything has changed so tremendously much, that bigger picture isn’t really a picture anymore.”
Buck opened the discussion up to the council, saying, “We’ve dealt with this before. It’s the slippery slope discussion, and where does it end once you start down this road?”
Councilman David Clayton reminded the owner there was no cap on the price the unit could be sold for. The restriction on the deed holds the owner to meet certain residency and employment requirements.
Buck added that the town had made adjustments to the rules, allowing people who don’t strictly meet the requirements, but come close, to buy a deed-restricted home in town. “We’ve made some adjustments and lifted some restrictions … so we have had some flexibility there.”
The owner also heard for the first time that she could rent the property to a tenant who met the requirements of the deed restrictions. “I live in Florida … and realistically I just need to sell it. I wish you could take in more consideration of people’s circumstances.”
Clayton said, “I see there are 98 deed-restricted homes or apartments in Mt. Crested Butte. The impact of making the decision would therefore impact other units potentially, because everybody could come in and point to the precedent we’ve set and ask for the same. We could end up losing a substantial portion of the affordable housing here.”
“It is the consensus of the council that lifting the restriction would not be in the best interests of the town at this point,” Buck said. As the woman started to cry on the phone, clearly desperate for some solution, it was clear she wouldn’t find it with the council. They all agreed to keep the restriction in place.