Boom(er) towns – Affluent second-home owners changing face of mountain counties

Colorado mountain resort counties are braced for a surge of second-home buyers in the next two decades as more baby boomers near retirement. "There is going to be a major change in Colorado, as we know it," said state demographer Jim Westkott. "The people who’ve been complaining about the highways not being wide enough will start complaining about the bike paths not being wide enough."

By Joe Garner, Rocky Mountain News

http://www.insidedenver.com/drmn/business/article/0,1299,DRMN_4_2619059,00.html

Already, 60 percent of the housing units in Eagle, Grand, Pitkin and Summit counties are second homes, said Gary Severson, executive director of the Northwest Colorado Council of Governments. The agency’s ongoing study of second-home trends is focusing on social and economic impacts for a chapter to be released in summer 2004.

The two-year study already has debunked one myth of second-home ownership, Severson said.

"A large number of second-home buyers are buying not because of the ski industry but because of other amenities," he said. "It’s a wonderful area to live."

"Recreational amenities" is the leading reason by 10 percentage points for buying in the mountains, followed by skiing and scenery.

Although the study concerns only the four counties along the Interstate 70 corridor directly west of Denver, similar effects have transformed other mountain towns, from Steamboat Springs in the north to Crested Butte in the south, into highly educated, affluent enclaves, Severson said.

"There are unique differences in each county, but there’s more applicable than not applicable," he said, "These are parts of Colorado that are being drastically changed and being closed off, with a loss of opportunity for younger people and the loss of a middle class."

Baby boomers, the generation born from 1946 to 1964, during the period of high birthrate after World War II, are driving the demand for second homes, Westkott said. Boomers are ages 39 to 57 this year, and a disproportionate percentage of Coloradans fall into that age group, he said.

Graying of Colorado

From now to 2010, in the graying of Colorado, the 55-to-64 age range will increase 5.9 percent annually, compared with 3.9 percent annually nationwide, Westkott said.

Typically, baby boomers are in their peak earning years, and, in many cases, they already have inherited wealth from their parents. For some, who are still working a curtailed schedule, a second home is a test run for retirement.

Nationwide, Americans owned 5.5 million second homes during the 1990s, a figure that is expected to jump to 6.4 million units this decade, according to the U.S. Census Bureau. The most popular sites are seaside, lakeshore and the mountains.

In the Colorado Rockies, the rush to the mountains has replaced condominiums with trophy homes, largely since a 1986 change in tax laws made real estate a more attractive investment, especially compared to tanking stock prices. After the Sept. 11, 2001, suicide strikes against the United States, mountain lairs have represented safety from terrorists and urban criminals, while technology brings city conveniences to the country.

"There is not developable land in Pitkin, Eagle or Summit counties to fit in all the people who want to live here," said Pitkin County Commissioner Mick Ireland.

Nearly 50 percent of second-home owners in the four counties studied have an annual income of $150,000 or more, the study learned.

"The whole face of the region is changing rapidly, and it’s all wealth-driven," Severson said. The survey found that 40 percent of the second-home owners also have at least a third home.

"Even lawyers, doctors and other people we would think of as having high incomes aren’t able to afford a place in Aspen, Vail or Breckenridge or any other of these mountain towns anymore," Ireland said. "Or, if they can, it’s moving out of reason."

First high country winter

Tim Lytle, 58, and his wife, Jan Lytle, 56, are living the trends identified in the second-home study.

They bought a $300,000, three-bedroom townhome in Silverthorne’s Wildernest community in 2001 before he retired from U.S. Steel in Pittsburgh. He retired last spring after 35 years, and she had retired from the same corporation a few years before.

"We’d been skiing all over the West," Tim Lytle said. "It was kind of a progressive thing. We looked at virtually every area from Durango to Glenwood Springs to Evergreen and Conifer."

They hike and bike in the summer, ski and snowshoe in the winter. They swim and work out year-round at the Silverthorne Recreation Center.

"It’s an active lifestyle," he said. "People who choose to live up here are usually very active."

They’ve found it easy to meet people through Summit County Seniors and the Over the Hill Gang, organizations that help retirees network.

Lytle said he is considering a part-time job with a ski resort, partly for the ski pass that some employees receive and partly just to get him out of the house a couple of days a week.

They are entering their first winter at 9,200 feet elevation, with a Florida vacation already planned for "mud season" in the spring.

"We haven’t lived here through a five-month winter before," Lytle said. "After we’ve been here a winter or two, we’ll decide whether we want to buy a house here or move closer to Denver, but we don’t think we would leave Colorado."

Here one day, gone next

Mountain living is different from city living.

About 50 percent of the residents in the four mountain counties studied have lived there less than 10 years. Just over 20 percent have lived there more than 20 years, the study found.

"People come to the county commission and think we should pave the road up to their driveway, and we tell them we can’t," said Summit County Commissioner Bill Wallace. "They’ve built a huge, remote home, high up a mountain road, with an electric gate and a long, paved driveway.

"They come from an urban environment and don’t understand we can’t have an ambulance within five miles of every home in the county, or, if it snows, some roads may not be plowed for a day or two after the storm."

Compared with the average single-family homeowner, the second-home owner spends five times as much on lawn care, home security and housecleaning to maintain his Colorado home, according to the study. At least in Pitkin County, part-time residents frequently use such personal services as massage therapists, caterers, nannies and aromatherapists.

Some of the second-home residents are labeled "interim retirees," people enjoying an active retirement in their 50s because of their affluence. When they get older, perhaps with deteriorating health, they move on, often to the care and comfort of their family circle back home.

"In Aspen, there are a fair number of people who burst on the scene and want to remake the town," Ireland said. "Then one day, you wake up and they’re gone and their house is listed."

Bryan Austill, a Breckenridge psychologist, compared life in a mountain resort community to life on a military post, with regular comings and goings as some residents decide that snow-country living is not for them.

"Some find it’s isolating," Austill said. "They don’t have the long-term friendships and extended-family support system they have back home."

The long winters, the high cost of housing and other living expenses, and demands on a couple to work two, three or even four jobs impose stresses on middle-class families, he said.

Some families buy homes in Leadville, Fairplay, Kremmling or Silt to avoid housing costs in resort communities, adding a 30- to 45-minute commute over mountain roads to their workday.

The flight of middle-class families leaves resort communities split between those who can afford to play all the time and those forced to work all the time.

"It doesn’t create tension between people, but it creates inner tension for the working poor," said Austill, the psychologist who also is a part-time minister at Father Dyer United Methodist Church in Breckenridge.

"If you see people driving luxury SUVs and going out to eat at expensive restaurants and essentially living a resort lifestyle all the time," Austill said, "you can’t help but wish for some of that for yourself."

Worse crowding to come

If you think Colorado resorts are crowded now, just wait 20 years.

"There isn’t going to be any developable land that hasn’t been spoken for by second-home occupants or retirees or the businesses and their employees that serve them," Westkott said. "There’ll be homes, hospitals, schools and the malls that people expect."

As more baby boomers retire to their second homes, those units will be removed from the part-time rental market, further squeezing out working families, according to the study.

The study found that 14 percent of second homes are full-time rentals, but that number will be cut in half, to 7 percent. That means more year- round residents traveling on roads and using community services, without more construction.

"Grand County is still the affordable second-home area. Most of the second-home owners in the Fraser Valley are Front Range residents," Severson said. "Whereas Aspen is totally different, with the wealthy from both coasts, Europe and South America. Summit and Eagle counties are somewhere in between."

But, what happens beyond 2023 or 2025, when the aging baby boomers are no longer buying second homes or are too old to enjoy an active retirement?

"No, I don’t think we’ll be overbuilt," said Wallace, the Summit County commissioner, "because there will always be people who want to live in the mountains."

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