Proposed changes would impact Aspen home values
Attention, residential property owners! The city of Aspen is currently working on updating its housing mitigation fees and regulations for residential properties which will dramatically, from $60,000 to $474,000 in typical example, increase housing mitigation fees by eliminating credits for existing improvements and changing the definition of square feet for purposes of assessing housing mitigation fees from permitted floor area to gross floor area including all basement space, garages, etc.
While the imposition of these fees is only assessed with development, massively increasing fees impacts the value of a home/site as any reasonable developer/builder/buyer takes into consideration all significant costs when considering a site acquisition. Simply put, site costs + design fees + hard construction costs + city mitigation fees + value creation/profit = total budget/value. If the cost of any one of the inputs rises materially, either the total budget/value must go up, or the other costs, most likely site costs, must go down.
For anyone who might be considering redevelopment of their Aspen home, the proposed change to housing mitigation fees adds hundreds of thousands to the cost. In my opinion, for Aspen’s smaller, older homes, the impact on value of this massive increase in fees is several hundred thousand, $410,000 based on the city’s example of typical current build-out.
This change is set for a second hearing before City Council and likely approval on Dec. 14.
Development should pay its fair share of housing and other impacts, but regulations, fees and taxes should be fairly assessed and recognize the many ways that free-market, resident-occupied homes support and satisfy community housing needs.
I urge Aspen’s residential property owners to be aware of new city policies that are being proposed that will impact the value of your home.
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