After homeowners protest, Avon tables planned updates to housing policies for price-capped, deed-restricted units

Avon is in the process of reevaluating the deed restrictions on its price-capped units, but immediate action was stalled after some homeowners pushed back against the proposed new policy.

Patti Liermann, Avon’s housing planner, presented proposed replacements to existing deed restrictions for the town’s price-capped units to the Town Council on Tuesday.

Over the last few years, Avon has been updating its community housing plans and policies to align with the dramatic changes to housing values in Eagle County that came with the COVID-19 pandemic. In 2021, the council approved a new Community Housing Plan. In September 2023, the town updated its community housing policies document, which had not been revised since its creation in 1991, with a focus on making sure definitions were in alignment with present-day conditions and terminology.

The town’s next step was to look at the five existing price-capped, deed-restricted housing complexes in Avon, Liermann said. In this exploration, town staff found that some deed restrictions fail to point to the housing policies document at all and that the Wildwood Townhomes, in particular, did not align with the town’s housing goals.

Avon’s proposed deed restriction changes

Price-capped deed-restricted properties are one type of affordable housing that the town offers. Liermann presented options for “a recorded deed restriction and a flexible and amendable document that allows us to modify specific provisions, that will benefit from being able to be modified without replacing that deed restriction down the road.”

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Specifically, the updates would address three specific areas: Buyer eligibility, capital improvement policies and buyer selection. The town’s five sets of price-capped, deed-restricted units are the Wildwood Townhomes, the Chapel Square Condominiums, the Lodge at Brookside, the Sheraton Mountain Vista and the Grandview Condominiums.

Buyer eligibility, or those who are allowed to live in price-capped, deed-restricted units, would receive minor changes that point to the Avon Community Housing Plan.

While all the buildings have a capital improvements policy, “they are not very generous,” Liermann said. “The way that they’re written currently is it gives about 10% of the value of the property, and for some, it says ‘for the life of the deed restriction,’ and for some, it says ‘for the life of the owner.’ Some of them, it’s for 10 years and then it resets. But it really isn’t promoting addressing maintenance or addressing replacement of items.”

Town staff instead recommended replacing the old policy with that in the new community housing policies, which allows for improvements up to 10% of the value of the home and resets every 10 years to align with the current value of the home.

While four of the five buildings already point the resale selection process toward an administrative committee, the Wildwood Townhomes deed restriction allows the seller to choose the buyer.

“We’ve seen some not great things happen,” including a seller demanding additional payment outside of the maximum sale price from the buyer, Liermann said. “We want that to never be an issue again.”

Liermann suggested making the resale selection process “neutral” and selected by a third-party administration like the town or the Valley Home Store, rather than the seller.

The town will also provide updates to the town’s breach, remedy, general provisions, including adding the town the opportunity to purchase a deed-restricted property out of foreclosure. Right now, when a deed-restricted home goes through foreclosure, the town loses the deed restriction.

However, the council tabled these updates after hearing from Wildwood Townhomes homeowners, who protested the implementation of the new policies.

Wildwood Townhomes owners protest

Wildwood Townhomes units were built in 1991 and sold for $78,000 for a two-bedroom and $96,000 for a three-bedroom unit. The deed restriction placed on the units included a 3% simple interest appreciation based on the most recent sale price. This caused a price disparity for units that have never sold or only sold once and units that have resold several times. “With Wildwood, we have some homeowners that feel trapped,” Liermann said.

Wildwood units are “rare” for being affordable to those earning 30% of area median income, said Jena Skinner, Avon’s planning manager. “Our ability to build that level of housing is beyond our reach. If we’re lucky, we’re hoping to get 80% AMI.”

The town proposed four changes to the Wildwood policies: Increasing the baseline home values for all units to $200,000 for a two-bedroom and $250,000 for a three-bedroom unit, changing the interest rate to 3% compounding interest, requiring administrative oversight over the units’ resale, and adding education for homeowners association members.

Liermann said that after doing research, she didn’t know of any other communities that have made such a change in interest rate, but that the compounding interest would still allow the units to remain affordable down the line. The one-time correction to the units’ base price would “bring everybody back into alignment,” she said.

“The replacement deed restriction is entirely elective. We cannot force an owner to sign this over,” Liermann said. “We do think that these will benefit the existing homeowners, and in doing so, it will also benefit the town because it’s going to again align these processes and make things a little clearer, and we won’t have all these different documents we have to go back and forth to look at.”

Maria DeSimone, a Wildwood homeowner, said all 17 owners disagreed with the town’s proposal.

“The town’s current proposal does not serve the goal of affordable housing while respecting our needs as owners,” DeSimone said, citing the low resale prices and regulation of the resale by the town as specific concerns. DeSimone asked the town to listen to the homeowners as a collective and said that “several attempts” to communicate with the town had been denied.

“There hasn’t been this proper respect and negotiation between we the owners, and all of our concerns, and what the town’s trying to lay out,” DeSimone said.

Dick Hoene, another Wildwood homeowner, suggested enabling a free market-style buyout process, as most homeowners had been in their homes for 30 years. “We need to reconstruct these places,” he said.

Town staff met with Wildwood homeowners in November 2023, May 2024, and through individual sessions.

The council will revisit the policy, likely in November, after town staff has the chance to meet with Wildwood homeowners again.