A two-bedroom condo at YVHA’s Cottonwoods development could start at $311,000
- Dylan Anderson
- Jun 6
- 4 min read
STR Tax revenue will help some units sell for 45% lower than cheapest two-bedroom condo sold in Steamboat through April of this year.
Some two-bedroom condos at the Yampa Valley Housing Authority’s Cottonwoods at Mid Valley development could cost $311,000, roughly 45% lower than the cheapest two-bedroom condo sold in Steamboat Springs through April of this year.
This lower-than-earlier-anticipated sales price — down from $361,300 — comes after Steamboat Springs City Council indicated on Tuesday they would redirect $5 million in Short Term Rental Tax revenue toward an earlier phase of the project.
Furthermore, a majority of council members said they were open to increasing the grant from its current $5 million mark in an effort to bring some unit prices down further.
“Things in the mid to low threes to the high fives and sixes don’t really exist in this market,” said YVHA Executive Director Jason Peasley. “Townhomes are over a million, condos are $800,000 plus, single family homes are over $2 million. The goal here is to deliver product that otherwise wouldn’t exist and we think we are hitting that mark.”
The median sales price for condos and townhomes in Steamboat Springs was $915,000 in 2024, according to an analysis published by John Wade at The Steamboat Group. Through March of this year, the cheapest two-bedroom condo to sell in Steamboat was $496,000 for a Whistler Village Townhome. The cheapest one-bedroom condo sold the in first quarter of this year went for $380,000 in Walton Village.
Peasley said they are seeing a “double whammy” in the development world as costs to build continuing to grow while interest rates stay high. For example, it cost roughly $330,000 to build each unit at YVHA’s Alpenglow Village in 2020, and $411,000 to build each unit at Anglers 400 in 2023. Units at the Cottonwoods will cost about $556,000 each to build, Peasley said. This increased cost comes as interest rates for buyers still hover around 7%.
“The combination of those two things drives up costs and simultaneously reduces the buying power of our target market,” Peasley said.
Units are able to be sold for less than it cost to build them because of the subsidy that has already been put into the project, Peasley said. This includes the anonymous donation YVHA received to buy the land, a $4 million grant from the state of Colorado, $1 million in concessions from the developer and more than $1.8 million in YVHA money. Adding another $5 million in STR Tax revenue would increase the subsidy per unit by roughly $58,000.
The Cottonwoods — which is currently under construction along U.S. Highway 40 on the south side of town — includes two buildings in the first phase with 86 one-, two- and three-bedroom units. Units will be deed restricted, which includes an appreciation cap meant to ensure that these units are still affordable when they are eventually resold in the future.
The city initially gave $5 million in STR Tax revenue toward building three of the project, but delays in development have YVHA hitting pause on that phase for now. Peasley said shifting that grant toward phase one of the Cottonwoods allows them to make buying more realistic for more people.
“With your investment, we can drive those prices down and by doing so, you lower monthly payments,” Peasley said. “Interest rates are working against that monthly payment number, and it’s precluding folks from getting into housing, getting into homeownership.”
Estimated monthly payments for a two-bedroom unit priced at 100% AMI would be roughly $2,600 a month, a number that YVHA says includes the principal, interest, taxes, insurance, private mortgage insurance, and HOA fees.
The average rent for a two-bedroom apartment in Steamboat in new or renovated buildings is $2,900 per month, according to a preliminary housing and demand report from YVHA. The full results of this demand study are expected in July.
Council ultimately directed staff to work with YVHA on a deal to redirect the $5 million already awarded to the first phase of the Cottonwoods. They also directed the two to work out a deal for more STR Tax dollars, laying out how it would impact other purchase prices at the Cottonwoods. Council would consider that deal at a future meeting.
Routt County Area Median Income increases to $91,000 per year for 2025
Area median income in Routt County has increased nearly 40% since 2020 and now sits at $91,000 per year for a single person, according to data published annually by the Colorado Housing and Finance Authority. For a family of four, AMI for 2025 sits at $130,000.
Area Median Income means that half of one-person households in Routt County make more than $91,000 and half make less than that. These numbers are important when considering affordable housing, as developments are built to target various AMIs. To qualify for a unit priced at 100% AMI, an individual buyer would need to make less than $91,000 per year.
The Cottonwoods has been designed to target incomes of 100% to 140% AMI, which hopes to hit folks in the so-called missing middle. These folks often make too much money to qualify for federally subsidized housing, but are unable to afford homes priced at market rates. As AMIs in Routt County increase, Peasley said they are needing to target lower AMIs.
“AMIs have increased so much recently that middle market isn’t hitting the market anymore,” Peasley said.
As currently envisioned, the Cottonwoods is targeting incomes from 100% to 140% of Routt County AMI. That is $91,000 to $127,400 each year for an individual and $130,000 to $182,000 for a four-person household.
Council briefly discussed the idea of reducing AMI targets at Cottonwoods for some units down to 80% on Tuesday, which is $72,800 for an individual and $104,000 for a family of four. If they did this, Peasley recommended they move units currently priced at 140% AMI down to 80%, which could potentially lead to a one-bedroom unit costing less than $200,000.
