The Yampa Valley Housing Authority is redesignating 12 for-sale units at The Cottonwoods at Mid-Valley from 140% of area median income to a mix of 120% and 100% AMI, citing less demand for a certain “product type” at higher income levels, according to a statement released Tuesday. 

In a follow-up statement to the newspaper, YVHA Communications and Community Engagement Manager Laraine Martin said the redesignated units are comprised of seven one-bedroom, four two-bedroom and one three-bedroom unit. 

Five of the one-bedroom units will be redesignated from 140% to 100% AMI, while the remaining units will be redesignated from 140% to 120% AMI. 

For a one-person household in 2026, 140% AMI sits at a roughly $136,000 annual income, compared to approximately $116,500 and $97,000 for a single person at 120% and 100% AMIs, respectively, according to the housing authority’s website.

For a two-person household, that shifts to $155,000 at 140% AMI; $133,000 at 120% AMI; and $111,000 at 100% AMI. 

“This is where the need is currently landing in our community,” said YVHA Sales & Asset Manager Alyssa Cartmill in the statement. “We are receiving that feedback and responding by doing what we can to get more people into affordable homeownership as soon as possible.” 

The decision was discussed at the housing authority’s July 2 meeting, with all board members signaling support to go forward with the price movements. 

Buying down the AMIs for the 12 units will cost YVHA $700,000, to be funded by “remaining project funds and YVHA budget funds,” wrote Martin in the statement. It will also warrant a new lottery process akin to the lotteries conducted in the spring following the development’s initial launch. 

Newspaper staff followed up with YVHA representatives for further clarity on the source of the $700,000 given The Cottonwoods’ initial funding crunch for Phase 1 and the city of Steamboat Springs’ $10 million in short-term rental tax revenue to help buy down the AMIs originally. 

Martin explained that the funding will come from two places: $386,000 remaining from the $10 million grant from the city, and $311,000 identified in the housing authority’s budget as projected commissions from the sales of the 12 units. 

“Note that this is not actual cash sitting in the YVHA budget, but a projection based on sales,” wrote Martin. “YVHA will be contributing this amount from our development fund as further commitment to the project.”

At the Steamboat Springs City Council’s regular meeting on Tuesday, Council President Steve Muntean noted this development during council reports. 

“What we’re finding — and this is a learning experience, because this is the first time (YVHA has) had homes for sale —is that people don’t want to get a one-bedroom unit because they’re thinking of the future,” he told his colleagues. 

“They’re going to have ownership now and they’re thinking about either getting married or having kids,” Muntean continued. “So the interest or demand in one-bedroom units is lower than anticipated.”

City Manager Tom Leeson added at the meeting that many of the community members within the 130-140% AMI range seeking homeownership have now shifted to the city’s newly launched Home Base Steamboat deed-restriction program. 

“We have 50 applicants now for that. We’ve already given 13 qualification letters,” said Leeson. “So just so you know, that program is now serving the need that was missed in The Cottonwoods.” 

The lottery for both 100% and 120% AMI levels will be open from July 22 to July 28, running on July 29. Open houses are currently scheduled from 3-6 p.m. July 9, 14 and 16 at 1650 Mid Valley Drive in Steamboat Springs.