Strategies

Buying or selling real estate in Summit County can be a very lucrative and rewarding venture.  However, each type of real estate whether it is a single family residence, condominium or land has its own idiosyncrasies and pitfalls that should be examined or avoided.

Land

The majority of residential land in Summit County comes in two categories.

The first, which makes up approximately 60% of vacant land for sale, is on municipal services. In other words, it has water and sewer services, power, and gas. The legal description is almost always by Lot, Block, and Subdivision. This type of acquisition is usually easier and can be completed quicker. Due diligence should include review and approval of covenants, declarations and bylaws. You will need to know the minimum building requirements, architectural guidelines and neighborhood codes etc. A certified survey or Improvement Location Certificate will be needed to verify the site location, building envelope and also to ensure there are no encroachments. If a loan is needed to buy the property, generally speaking, you will have to put at least 30% down and the loan duration will vary between 1 to 5 years.

The second, which is the next most common type, is residential land that does not have any municipal services, except maybe power, phone and cable. Due diligence has a lot more process. In order to eventually build you will need to obtain a septic permit and well permit. The size of the septic/leach system obviously depends on the size of the house. Summit County quantifies these sizes mostly by the number of bedrooms a house includes. Example: a 3-bedroom house requires a 1250-gallon tank and leach field size varies depending on percolation and grade of slope. The building envelope of a poor percolating large septic field lot, can rapidly restrict the ultimate vision you were trying to accomplish. A well permit is obtained from Colorado Division of Water Resources. A household use only permit costs approximately $70.00 and takes approximately 6 weeks to receive. You need to make sure you have permits, septic/leach field design, survey or Improvement Location Certificate (ILC) in hand prior to close. Legal and practical (grade, snowplowing etc.) access to the lot and distance to power will have to be examined. You will also need to make sure there are no wetland violations that could occur. Again, if declarations, covenants and bylaws are pertinent, they will need to be reviewed. This process usually takes 8 to 12 weeks to accomplish and close.

Costs

These cost are just a 'rule of thumb' guide and can obviously vary.

Survey $650.00 + depending on size or complexity of survey.

Improvement Location Certificate (basically a re-certification of an existing survey) $350.00

Septic/Leach Field Design $1,600.00 and Permit $325.00.

Well Permit $650.00

Condominiums

When buying a condominium, try to imagine that you are buying 'airspace' within a building and all the walls, roof and common areas and land among others are owned jointly and undivided by all the condominium owners. A management company or onsite manager elected by the Condominium Association made up for the majority, by condominium owners, maintains nearly all things of the latter.

Due diligence, prior to purchase should include review of covenants, declarations and bylaws. Review of Articles, financials and at least one preferably two years of minutes from the Condominium Association meetings. Have they built up their reserves to pay for a new roof, refurbishment, painting etc? Are there any special assessments due or upcoming? A Home Inspection, while not mandatory, is highly advisable, whether the condominium is new construction or old. It costs roughly $250 -$350.00 depending on size of unit and is well worth it, negotiate to have the seller fix before closing or a mutually agreed upon amount to be credited to buyer at closing.

If buying for rental or investment purposes, it is wise to review the income statements for previous years, of the unit. Interview the short-term rental management company; find out the fees and income splits, which are usually between 40 to 50% (to management company). Compare their performance with some others. Have a rental analysis/return on investment report done, and check with your CPA or financial advisor.

Short-term rental management company - These companies can be a separate company from the Condominium management company. This company is responsible for marketing your unit to produce rentals and ultimately income. They will maintain the inside of your unit, rather like a hotel maintains its rooms. They will recommend when you might want to consider up-grading your furnishings to optimize rental performance etc. They will take care of minor servicing and repair of your unit. They will usually work around renting the property when you are not using it.