Steamboat Springs has several new condominium projects like Howelson Place, Alpenglow, the Olympian, Edgemont, Trailhead Lodge, One Steamboat Place and the Victoria coming on the market this year and next year.

As of March 1, Fannie Mae has made it harder to get financing.

Fannie Mae is no longer guaranteeing mortgages in condo buildings where fewer than 70% of condos have been sold. (They used to guarantee mortgages where 51% of units were sold.)  This new rule will affect the new Steamboat developments because none of them are more than 70% sold.

Trailhead Lodge comes closest, with 70% of the units presold, although some of them may not close due to tightening credit standards.  Owners who cannot close will forfeit their deposits of 10-20% of the purchase price.

Fannie Mae also no longer backs loan in developments where 15% of owners are delinquent on HOA fees or where more than 10% of condos are owned by one person (ex.--a straw man for the developer.)

None of the new Steamboat developments are sold out, but there are not a lot of units available.  There are less than 90 condos available in all the downtown properties combined, and less than 50 if you count up all the unsold mountain condominiums at the Steamboat ski area.

(There are around 400 new and resale condos available in the entire Steamboat Springs MLS.  They range from $133,000 studios to $4,995,000 ski-in, ski-out luxury condominiums)

Compare that with the thousands and tens of thousands of vacant condos available around the country--especially in the foreclosure hot zones of Florida, Nevada, California, and Arizona--and you can see why Steamboat condo buyers are being penalized by the errors of over building around the country.

What does this mean for new Steamboat developments?

• If you have cash, ignore all this, buy your condo, and love living the good life in Steamboat Springs.
• Ask your Realtor about developer financing. Some of the projects have financing in place through the lender who did the construction financing.  You may even get an excellent rate, like the 2.5% available at Bear Lodge.
• Some units in some buildings--like Howelson Place--have seller financing. They'll even finance 100% to qualified buyers until this restrictive credit market passes.
• Expect the new developments to get exemptions from the new rules.  Howelson Place and Trailhead Lodge are examples of new condo developments where you can get financing.

Once again, the Steamboat real estate market is being affected by conditions in the "bad apple" markets where most of the credit problems have originated.

Condotels were the first to be affected, and in our resort market, most of our condominium developements are considered condotels by the "suits" that define condotels.  Jumbo mortgages are also an issue--even though the majority of Steamboat properties are worth more than that arbitrary $417,000 loan amount, you'll pay 1-1.5% more for a loan greater than $417,000.  (Bank of America is now marketing jumbo loans at reasonable rates.)

If you are considering purchasing a new Steamboat Springs condominium--and you should, because the selection and prices are better than they have been in years--call us at (970) 819-6372.  See why it could be a good time to buy a Steamboat Springs condo, even as Fannie Mae tightens the purse strings.