Mountain News 

Understanding the real estate economy

VAIL, Colo. — Real estate construction for vacation and retirement homes has been the big story for 10 to 20 years in Aspen, Vail, and Jackson Hole, and it continues to get even bigger. In an extended series on this phenomenon, the Vail Daily notes the increasing concentration of wealth.

Peter Francese, a demographic trends analyst for Ogilvy Mather, explains it this way: "The top 20 per cent of income households take home 50 per cent of all the money earned in this country."

Mick Ireland, a Pitkin County commissioner, further explains that the bottom 60 to 80 per cent of the population has seen little or no growth in income, while the top wage-earners have 20 times more wealth than they had 20 years ago.

One problem with this new real-estate based economy is that it has elevated real estate prices but not necessarily wages to correspond. Thus, affordable housing has become a pressing, even desperate need. But Ireland warns that, at least in Colorado, the answer cannot be found by importing workers on a daily basis. The state highway treasury is nearly empty.

But a more far-reaching problem is being talked about by various individuals: when this new boom ends. "In 10 or 15 years, there will come a time when the boomers are going to say it’s time to cash in and retire," said Francese. "I’d hate to be the last guy to have bought a million-dollar condo in Vail, because when they move on, they do so with a vengeance."

Echoes of ‘Chinatown’

FRASER, Colo. — The 1974 film Chinatown resonates broadly in the West, but perhaps no place so urgently as Colorado’s Fraser Valley, where Winter Park is located. That film examines the machinations behind development of Los Angeles in the 1930s and that city’s reach to into the distant Owens Valley, on the far side of the Sierra Nevada, to get the necessary water.

The Fraser Valley has had a similar relationship with Denver that dates to the late 1920s. Located at the very headwaters of the Colorado River, the valley exports 60 per cent of its water to Denver and its suburbs. But Denver still retains rights for substantially more water and wants to exercise those property rights. The effect would be to take up to 80 per cent of the valley’s water.

With these parallels in mind, a group called Friends of the Fraser River recently showed Chinatown at a local library followed by a discussion among 40 people. While the film ends in murder, the local activists are confident of a more peaceful resolution of their disagreement with Denver.

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