SUMMIT COUNTY, Colo. (CBS4) – State lawmakers will decide if short term rentals across Colorado are taxed as commercial property rather than residential. Resort communities in Summit County say bumping the tax rate up to 29% from 7.96% will devastate local real estate markets.

(credit: CBS)

The thought behind this major change to short term rentals is to help with the housing crisis. Many believe rental companies like AirBnB have only made it worse.

The effects could leave places like Summit County in real estate ruin according to local real estate experts.

“It is unbelievably dramatic and terrible,” Dana Cottrell, President of Summit Association of Realtors, told CBS4 Monday.

(credit: CBS)

Inside the Summit Association of Realtors, the threat of this change to short term rentals is sending shock waves through the industry.

“It’s not good. We have more residential rentals than any other county in the state. There are some thoughts that up to 40% of people will put their homes on the market if this goes into effect which would crash our economy. It would be terrible,” Cottrell added.

They believe the statewide change to how short term rentals are taxed will have unintended consciences.

(credit: CBS)

“I can tell you right now the emails I’m getting are emails of hurt. They’re like ‘you don’t want me? Well, if you don’t want me, maybe I’ll just leave,’” said Mark Waldman.

He owns the largest property management company in Breckenridge. Waldman says if passed the change will destroy his business and force him to lay off staff.

“We have not seen a statewide effort that is so devastating and so dramatic from anywhere else in the country,” he said.

It’s not clear what chance this has to pass out of committee, but there’s a hearing scheduled early next month.

Comments (9)
  1. DPB says:

    30+ year Summit local here. Where did people stay before Air B&B and VRBO? Our problem right now is that we have TOO MANY tourists! Businesses can barely operate because of staffing problems directly related to the fact that the working class can barely afford to live here. Maybe if we make these STR’s start operating as businesses (that’s what they are) and subject them to the same zoning and regulations as any other business (like hotels), then the playing field will be level and we can find some kind of long-term balance instead of chasing perpetual growth at the expense of everything else.

  2. GreedyLittleSoAndSos says:

    I find it interesting that the only people arguing against this are people who make their living off the artificially inflated market. How about you do a story on the fact that housing in Summit County is so out of wack with the cost of living that people who work here can’t afford to live here. Or maybe a story on the fact that over half the homes aren’t owned or occupied by Colorado residents, but are bought and used as a business. Instead of being a mouthpiece for the Realtors and out of state interests try to be a voice of the people who live here.

    1. Jake Himmelman says:

      I am going to send the same reply as I did before. I am 31 year resident of Breckenridge. I grew up here. My family has worked very hard for the last 30 years to make a life here and we are all very worried about the proposed tax hike, as are most long time residents of these areas. My Mom has been in property management for 30 years and my brother does advertising for local companies. This is our home and we will be forced to leave if the tourism industry struggles. The very people for whom you are hoping this would open up housing for, will no longer have an opportunity to live here. Breckenridge doesn’t have hotels (maybe 2). Where are the tourists going to stay? If the tourists don’t have a place to stay, then they will have to go somewhere else. Our economy is almost 100% based on visitors. Most business will be forced to lay off employees or shut down. Restaurants will struggle. Worse yet, this is proposed for all of Colorado. Our resort economy throughout the state will be in shambles and unemployment will sky rocket. I think only looking at how this affects real estate is short sided. The locals of these resorts will be the ones who get hurt the most. Breckenridge will no longer be a place to live, only a place to visit. And that’s sad for all of us.

      Now for the real estate argument, the values of the local real estate will tumble. Do you think that’s fair to the long time local who has worked so hard to live and raise their families in Breckenridge? All of their equity would vanish and everything that they worked so hard for will dwindle. Also, very sad.

      1. FightingFUD says:

        I am not sure what anyone did to “work hard” for a 400% increase in home value that is a result of artificial inflation of value. Five of the eight townhomes around ours have all sold to out of state owners who pain unrealistic prices ($600-700 per square foot) for a business they never reside in and rent out in competition to the dozens of Summit County hotels and resorts and make money off of that business without paying business taxes. Again the FUD sounds all scary and filled with doom, but has zero basis in facts…

  3. Robert Grimm says:

    If the State taxes them as commercial properties than legally they would not belong in residential areas. This would finally give neighborhoods back to neighbors and would also open up houses to middle class people who have been forced out of the housing market do to the over inflation of home prices due to the STR market. A win for all,as I see it.

    1. Jake Himmelman says:

      Unfortunately the middle class, or any class for that matter, will no longer have jobs in Summit County. The very people for whom you are hoping this would open up housing for, will no longer have an opportunity to live here. Look at Breckenridge for example. We don’t have hotels. Where are the tourists going to stay? If the tourists don’t have a place to stay, then they will have to go somewhere else. Our economy is almost 100% based on visitors. Most business will be forced to lay off employees or shut down. Restaurants will struggle. Worse yet, this is proposed for all of Colorado. Our resort economy throughout the state will be in shambles and unemployment will sky rocket. Your “neighbor” will be a group of 11 young guys, crammed into a house, renting on a long term basis, and throwing parties every night. That is, of course, they have managed to find a job in the now struggling work force. I think only looking at how this affects real estate is short sided.

      1. FightingFUD says:

        You might want to Google Breckenridge hotels… There are a significant number of hotels in Beeck, Frisco, Silverthorne and Dillon. But hey you paint a nice room and gloom picture that is completely unsupported by anything close to resembling facts… You aren’t by chance in the real estate or property management industry are you? Resist the FUD of those who are making their money as a result of an artificially inflated market.

        1. Jake says:

          Where are you from? Can you name the hotels in Breckenridge? Do you think someone who is staying at a hotel in Dillon is going to eat at a Breckenridge restaurant for dinner? Do you understand how a market becomes “artificially inflated”? Do you think Vail may have something to do with that? Breckenridge is almost 100% built out, it is super easy to get to, and Vail offers the best deal in the world for skiing. None of that is artificial. Not to mention, almost everyone who lives in Breckenridge makes a living off of those tourists who rent these places. We are grateful for the people who rent out their homes. Trust me, I understand that living in Breckenridge is expensive, but I am certainly not going to ask someone to lower their property value (by supporting the tax hike) to make my life easier.

  4. posi211 says:

    Time to stop advertising on VRBO.

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