Chiwawa River Pines Covenants Vote Results
Posted on September 29th, 2008 by Al Lorenz
The member meeting for Chiwawa River Pines Community Association was held on Saturday. There were three covenant amendments on the ballot and here they are and the results:
- Allow Long Term, low impact, service oriented businesses?
YES 226 NO 15 - Allow long-term, residential rentals for a period of more than six (6) consecutive months?
YES 183 NO 51 - Allow short-term residential rentals for a period of less than six (6) consecutive months?
YES 78 NO 160
The community association is also running a blog site for getting out information to the community that can be found at www.chiwawariverpines.wordpress.com
9 Responses to “Chiwawa River Pines Covenants Vote Results”
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As I have said before, I think this will have a negative effect on home values in the neighborhood. It may make it a nicer place to live, but I think buyers of vacation homes will think twice before choosing this neighborhood. Read more of my opinion here: http://tinyurl.com/42a522
We all have opinions. It sounds like you believe that a neighborhood is nicer to live in without vacation rentals. Interesting that you seem to believe that a “nicer place to live” will over the long term have lower values. Certainly time will tell.
My opinion is backed by data. Prices in Leavenworth are lower in places that don’t allow nightly rentals. The majority of sales in our area are by residents of Western Washington buying a second home. Many of these people are interested in renting their home or at least like the possibilty of doing so at some time in the future.
PS – I think you should change your author tag to ” al lorenz”. “admin” isn’t as transparent as a blog should be.
Geordie, I can tell you love your data. You state “prices in Leavenworth are lower in places that don’t allow rentals.” Of course, you realize that the neighborhood we are talking about is not in Leavenworth proper. While Leavenworth was fairly full with rentals for Autumn Leaf last weekend, Lake Wenatchee was not. The rental season and number of days of that season are quite different in the Lake Wenatchee area from Leavenworth proper.
Also, in your blog post, you present “data” showing that sales are slower in Chiwawa River Pines than last year. Your implication, with bold type, is that it has something to do with this issue. Other factors that probably have some impact on this year’s sales include a housing meltdown and the credit implosion. Funny, Chelan, Seattle, Wenatchee and nearly every town in America also have lower sales and higher inventory than in 2007. You can’t seriously believe the whole country is having a short-term rental issue.
You say “Chiwawa River Pines used to be a desirable neighborhood.” You also imply that this “ban,” as you call it, is something new. The covenants there, as far as I can tell, have never allowed commercial rentals. The only thing that has changed since Saturday is certain things that were not allowed in the covenants in the past are since this last member vote. As far as whether that neighborhood “used to” be desirable, what data do you have that says it isn’t anymore? Have there been any new properties put up for sale since Saturday? Do you know whether, if the vote had gone the other way, owners might have decided to sell who would not have liked a different result? One thing I can tell you is that Chiwawa River Pines IS a desirable neighborhood. If you look at the vote counts, the margins by which covenant changes were either accepted or rejected were not even close. That in itself speaks to the reasons and values that members of that community place on their environment. I doubt the hundreds of owners are somehow not representative of the market.
In downtown Leavenworth, with one of the healthiest year around tourist industries in the country, vacation rentals are certainly in demand. However, that does not necessarily mean there is not a market for other types of properties. Could the market for non-rental properties in downtown Leavenworth be overbuilt? Certainly. The farther a property is from Leavenworth, the less it resembles Leavenworth’s vacation rental market. What drives relative pricing is the availability of the types of product people seek versus the demand for each type of product. That might help explain why a neighborhood like Hunts Point, near Kirkland, has very high property values without having vacation rentals. Factors other than whether or not there are vacation rentals impact property value.
Based on your picture (which is the only data I have), I have a number of years on you. My experience is over time markets supply product for each of their segments. Today, there may be a demand for short term rental properties. Tomorrow, there may be greater demand for something else, like highly restricted, private gated communities or something else. Having a diversity of choices in housing, for vacationers, full time residents and part time residents at all income levels is what makes for a healthy market. I can show you data to support that as well.
So, I applaud you for having an opinion and being willing to state it. I just disagree that the conclusions you have drawn are beyond reproach. Since my crystal ball is far from perfect, I won’t claim to predict what will happen. I would state that the price in a neighborhood, any neighborhood, depends on the demand and supply of comparable properties. Over time, both sides of that equation vary and over time markets equalize supply and demand. One thing I am sure about is nobody knows where the market will be in one, five or ten years from now. What people do understand is what they value.
Thanks for the discussion.
Al
Al- Thanks for the dialogue. I know we disagree on this issue, but it is great to let folks on the sidelines see both sides of the coin.
I looked at data for the past 24 months in the greater Lake Wenatchee/ Plain / Leavenworth area. 164 homes sold outside of the city limits of Leavenworth. The average sales price of a single family home was $453,000 with a median price of $395,000.
Inside the city limits, where vacation rentals are not allowed in residential areas, the average price was $284,000 and $269,000 was the median price.
I did not account for difference in acreage, per square foot, age, waterfront etc. Which all could account for differences.
However, I do know from personal experience that vacation rentals are important to buyers.
Your Hunts Point “straw man” argument is amusing. Yes, most markets survive without vacation rentals. Most markets also do not rely on 75% or more of their buyers buying vacation homes. The Leavenworth and Lake Wenatchee real estate market is not driven by industry or relocation – it is driven by vacation homes.
You’re right about the market being slower this year. However, the Leavenworth area market is only off about 25% as far as the number of homes selling compared to 2007. It looks to me like Chiwawa River Pines is fairing worse than that.
Anyhow, as you mentioned we will both see what the future brings. The market will do what the market chooses do.
The last word is yours sir…
As I am a new owner in Chiwawa River Pines, I am extremely frustrated and upset over the recent decision. I purchased my land a few years ago and I was very excited to be a part of this development. While I understand that the covenants did not specificly permit or prohibit such nightly rentals, I was under the impression that they were allowed since there were so many in the development.
I have listened to arguments from both sides and I do not see the factual justification for banning nightly rentals. It appears to me that the a basic right has been taken away from me and many others based on the fact that many of the residents are being very selfish.
I don’t understand why there could not be a middle ground here. Why can’t there be restrictions and punishments if renters violate the rules.
I support Geordie’s opinion on values in the community. You immediately reduce the buyer market by elimintating the ability to subsidize your mortgage. Basic supply and demand would tell you that when then are more buyers, the values go up and vice versa. I would wager that many of the residents of CRP have been there for some time. The values they paid were significantly below today’s values. There is no need for them to subsidize a mortgage with nightly rentals. Well many of us would like to have a vacation place but we need the nightly rental income. I guess CRP will just become a place for the very wealthy!
Most of all, I have lost my passion for CRP and I don’t even live their yet!!!!!!. I am certainly not a real estate attorney but I don’t beleive this issue is over.
I don’t want this area to become like other resort/vacation areas where there isn’t affordable housing for us regular folks who don’t have the money to buy second, third, and fourth homes just so they can be rented out
It sounds like the owners in CRP have by majority vote have made their decision.
AND the covenants have never allowed commercial businesses.–if you have several homes for rent, a website,and a business license, it’s a commercial business.
There is a good chance values will go up because nightly rentals are not allowed. If you want a vacation home to rent out go elsewhere.
I have no intention of owning several homes and running a business! I would just like the flexibility to rent every once in awhile. It just seems to me that there could have been some restrictions or limitations that would have provided a limited ability to rent. I generally agree with the ruling if you are running this as a business. However, that was not my intention and I believe rules could be put in place to police the situation.
I am not sure I understand the difference between letting my family and friends stay at my place versus a renter. Are we restricting the ability to let family and friends use my home? I certainly hope not!
[...] That’s also why I don’t think the values will be negatively impacted. The folks that bought in Chiwawa River Pines have always known rentals weren’t allowed.“ [...]