The Frisco Deed Restriction That Can Sell Your Home for Less Than You Paid

"If the government is going to interfere in the market, it has to be really clear about its purpose," Frisco town manager Nancy Kerry told the Summit Daily back when the first wave of complaints hit. "The purpose wasn't to make sure that nobody could sell it for a reasonable price." She was describing a problem that, as of the most recent Frisco Town Council work session, still hasn't been fully solved.

Here is the problem in one sentence: in a Frisco home with a standard deed restriction, you can own the property for five years, watch the open market climb around you, do everything right, and still be legally required to list it for less than you paid.

That is not a hypothetical. It is baked into the math.

The formula nobody explains until you're the one selling

Frisco has roughly 155 properties carrying some form of restrictive covenant, most tied to affordable workforce housing developments built with public funds or granted through density bonuses. The majority share a resale formula that sounds reasonable on the surface: your maximum sale price is the purchase price plus 3% per year, not compounded, or the purchase price adjusted for the change in Summit County's Area Median Income over your ownership period, whichever is lower.

That "whichever is lower" clause is where things go sideways. The AMI figure is calculated using a national HUD formula with local variations, and it doesn't move in a straight line. If AMI in Summit County stayed flat or dipped in the years between your purchase and your listing date, the AMI path caps you below even the 3% path, and you're stuck selling at that lower number. A Frisco planner explained it to the Summit Daily by walking through the mechanics directly: pull the AMI spreadsheet from your purchase year, compare it to the year you're selling, and if that comparison comes back negative, that's your formula. It doesn't matter what the resale market outside your covenant is doing.

Where this actually plays out: the Peak One Neighborhood

The clearest example sits in Frisco's Peak One Neighborhood, a 69-home community of single-family and duplex units built on a twelve-and-a-half acre town-owned parcel and developed with Brynn Grey Partners. Sixty-one of the homes are income-restricted to households earning between 80 and 160 percent of AMI, and all 69 carry a workforce occupancy requirement. Peak One's own published terms list an appreciation limit of "lesser of 3% per year or percent change in AMI," with a 1.75% commission allowance added to the final resale price and capital improvements factored in on a sliding scale by AMI tier.

The frustration reached the point that nine Peak One property owners sent Town Council a formal letter in January 2023 asking for a rule change. Their ask was straightforward: let owners resell at whichever number is higher between the 3% path and the SCHA-calculated AMI price, not whichever is lower. Flip one word in the formula and the entire risk profile of owning one of these homes changes.

The 40 units playing an entirely different game

Not every restricted property in Frisco carries this ceiling. About 40 units in town operate under what staff call a "light" or live/work restriction. These have no appreciation cap and no AMI-based sale price limit at all. The only requirement is that the occupant work at least 30 hours a week within about a mile of the Ten Mile Basin, covering Copper Mountain, Frisco, and Farmer's Corner. Sell one of these and you're negotiating in something much closer to the open market, restricted only by who's allowed to buy it.

That gap matters for anyone shopping deed-restricted inventory in Frisco. Two properties can look identical on a listing sheet and carry entirely different math the moment you get to the resale calculation. The only way to know which formula applies is to pull the recorded covenant on that specific address, not to assume based on the neighborhood or the building.

What actually gets added back to the price

Sellers under the capped formulas aren't left with zero flexibility. Permitted Capital Improvements can be layered onto the resale price, though the rules vary by AMI tier. Under the Peak One terms, units restricted at 80% AMI generally can't add any qualifying improvements to their price at all, units up to 120% AMI can add improvements capped at 10% of the base price, and units up to 160% AMI have more room, subject to case-by-case approval. Council has also discussed extending the depreciation schedule on those improvements from five years to ten, which would let a seller carry more of that value forward the longer they've owned the home.

There's a buyer-side flexibility mechanism too. Under Frisco's 2019 covenant option, the first 30 days a restricted property is listed are reserved for local workforce buyers at the property's original AMI tier. If it hasn't sold by day 30, a 20% AMI spread opens the buyer pool, so a home originally restricted to 100% AMI buyers becomes available to buyers qualifying up to 120% AMI. That widening only applies if the seller opted into the 2019 covenant in the first place. Owners under an older, unmodified covenant don't get that grace period automatically.

The town has been working on this for two years and still hasn't landed

This isn't old news dressed up as current. Frisco Town Council held its ninth work session on housing covenant reform in October 2025, and council remained split 2 to 2 on the central question of how to fix the resale calculation. Two members backed keeping the 3% figure but tying it permanently to whichever is greater between that number and the SCHA maximum resale AMI price, flipping the current "lesser of" language to "greater of." The other two preferred simply raising the flat annual percentage, and floated 3.25%, 3.5%, 3.75%, and 4% as options, without reaching consensus on any of them.

Council did agree on a few adjacent pieces: capping real estate commission on these sales at 2%, moving toward a lottery system for buyer selection instead of seller's choice, and giving current deed-restricted owners in town an extra ticket in that lottery if they want to trade up or downsize within the program. None of that changes the core resale math yet. Any new standard covenant that emerges would apply to future restricted developments and to existing owners only if they choose to opt in.

The town's own housing inventory keeps this from being an abstract debate. In May 2026, council authorized the sale of four deed-restricted units at Mary Ruth Place, a rental workforce development on Galena Street, converting them to ownership under a 115% AMI framework with an income buffer up to 130%. If those units don't sell within 90 days at that AMI level, the town can shift to a work/live restriction with no AMI cap at all, or open the sale beyond the Ten Mile Basin to the rest of Summit County. That's the same lever running through the whole system: when the standard formula doesn't produce a buyer, towns and owners both reach for the same fallback, a looser occupancy-only restriction with no price ceiling.

What this means if you're the one signing the closing documents

If you're buying a deed-restricted home in Frisco, the listing price is not the ceiling that matters. The recorded covenant is. Ask for it before you write an offer, and ask specifically whether it's an original covenant, the 2019 opt-in version, or a light live/work restriction with no cap. If you're selling, run both calculations yourself well before you list. Pull the AMI table for your purchase year and the current year and do the comparison the town planner described. If the AMI path comes back lower than your 3% path, that's your number, regardless of what comparable market-rate units nearby have done.

Deed-restricted homes remain one of the more accessible entry points into Frisco ownership, and the workforce priority window can be a genuine advantage if you already live and work in the Ten Mile Basin. The tradeoff is that your upside on resale is governed by a formula the town itself is still actively trying to rewrite. Knowing which version of that formula applies to a specific address, before you're under contract, is the difference between a smooth closing and an unwelcome surprise at the title company.

A short FAQ

Does every deed-restricted property in Frisco use the same resale cap? No. Roughly 40 units in town carry a light, live/work-only restriction with no appreciation cap or AMI limit at all. The rest generally use the lesser-of 3% or AMI-change formula, though older covenants vary property by property.

Can I switch my home to a different covenant if I don't like my current terms? Owners can opt into the town's 2019 covenant voluntarily, and this has typically happened around a sale or refinance. The town cannot force an existing owner into a new covenant against their will.

Is the resale formula likely to change soon? Council has held nine work sessions on this topic through October 2025 without reaching agreement on the core resale calculation, and remained split 2 to 2 as of that meeting. Any change would likely apply to new developments and to existing owners only if they opt in.

If you're weighing a deed-restricted purchase in Frisco, or trying to figure out what your own restricted property can actually sell for this year, Tanya Delahoz can walk through the specific covenant on your address and what it means for your bottom line. Request a Personalized Market Consultation to get the numbers before you list or make an offer.