Short-term rentals are creating a problem in Colorado ski towns. Is there a solution?
After Ashley Otterness’ housing fell through at The Ponds at Steamboat, she had to scramble to find another living space so she could maintain her work at Steamboat Resort and Steamboat Whiskey Co.
For several days, it seemed the only housing Otterness could find was short-term rentals on Airbnb, VRBO or Vacasa.
“There are almost no options in town for people who actually work here,” Otterness said.
Otterness eventually found a studio apartment in Dream Island Plaza after sifting through what she described as “endless ads” for short-term rental apartments.
Steamboat community leaders agree the city relies on visitors to help keep its economy strong, and those visitors rely on short-term rental companies to provide them with lodging during their visit.
“In a resort community, it’s a necessary part of our economy to be able to provide housing and beds,” City Manager Gary Suiter said. “But at the same time, we need to do what we can to preserve the character of our neighborhoods and provide housing options for our residents and our workforce.”
Short-term rentals also tend to generate more income for the property owner, which is why many people opt for a short-term renter over a long-term tenant.
“The potential is there to make more income on a nightly rental than a long-term rental,” said Jason Peasley, executive director of the Yampa Valley Housing Authority. “This is especially true for people that live out of town but own a house in Steamboat that they want to use for a few weeks or a month out of the year.”
Steamboat Pilot & Today reached out to 14 Airbnb hosts through the Airbnb website, but none responded to requests for an interview.
“We’re in a position where everyone wants to be here,” Peasley said. “We just can’t build housing fast enough.”
A piece of the housing crisis
When Amanda Buckner hires new employees to work at the Foundry Treatment Center, where she works as the human resources manager, she always leads with a caveat:
“Housing here can literally be impossible to find,” she tells them.
Buckner has had potential employees turn down jobs because they were not able to find housing in Routt County that fit within their budget, and many of her staff members commute to Steamboat from Craig each day because the only available and affordable housing options they could find were there.
“It’s been really challenging to hire people, especially in the winter months,” Buckner said. “It’s really disheartening, because there are a lot of jobs in this community that pay well and offer good benefits, but the starting wage doesn’t match what it costs to live in this community.”
Other community members who work in Steamboat said commuting from Craig is common, as entry-level workers cannot find housing in the community within their budget.
“Most of these people work for the mountain or in the service industry and serve all the tourists that come to town,” said Brittany Sexton, a server at Rex’s American Grill and Bar. “It’s kind of unfair that we’re getting pushed out, and there’s no affordable housing for people that just want to live here.”
While Sexton herself said she has never had the experience, many of her colleagues and friends have been forced to find new housing when their leases are up, and landlords choose to convert the space into a short-term rental instead of a long-term rental.
“It’s just kind of upsetting how they’re pushing us all out,” Sexton said. “They want us to live in Craig, Hayden and Oak Creek, and they want us to leave so they can welcome these wealthy tourists and second-home owners. Pretty soon, no one is going to be there to serve them when they want to grab a beer, because no one can afford to live here.”
Measuring the problem
While housing experts shared varying views on how big of a role short-term rentals play in Steamboat’s housing crisis, they all agreed they’re part of Steamboat’s larger problem — too much demand with not enough supply.
“Short-terms take units that would otherwise potentially be available for long-term rentals to locals, and they remove that supply of housing,” Peasley said. “This is a phenomenon that’s sort of out of our control but certainly has an impact on the demand for our products.”
As for where the problem occurs, housing experts agreed short-term rentals are inevitable in the mountain area, as most visitors would like to be close to Steamboat Resort. However, experts said they have noticed more short-term rentals popping up in Steamboat’s downtown neighborhood over the past several years, as the city’s popularity continues to grow.
“It’s a problem everywhere,” Peasley said. “The demand continues to grow.”
Though the city of Steamboat requires short-term rental permits, the only people who must obtain a permit are those offering short-term rentals in either a single-family home or a duplex in what is considered Steamboat’s mountain area.
“It’s a pretty limited requirement for who even has to get a permit,” City Council President Jason Lacy said.
Suiter said there’s “no easy solution,” as people complain with or without the city’s intervention.
“There are two clear sides to the issue,” Suiter said. “People ask us how we can let people come into the neighborhood, rent out a house, party and destroy the neighborhood, but the other side is people who ask how the government can tell me what to do with my property.”
As Steamboat continues to experience population growth, the local government officials said they have struggled to measure the scope of the problem short-term rentals play in the city’s lack of housing.
“One of the things I hear from a lot of people is short-term rentals may be impacting our home prices and making things even more expensive,” Lacy said. “We need to see the data, see what it tells us and decide what are the main issues we’re concerned with, based on the data we’re seeing.”
In an effort to better study the issue and create solutions, the city has began collecting data on the number of short-term rentals in town and where they are located. Once the data is collected, the city will decide whether to place more limitations on where and how short-term rentals can exist.
“We think that’s going to be the important first step, so we can really start to understand what kind of impact short-term rentals are having on the community,” Lacy said. “It will be interesting to see where these are popping up so we can see if this is really the direction we want to be going as a community.”
Other housing experts said they believe short-term rentals are “an easy target” but not as large a problem as some may think.
“That’s just a microcosm of a much larger issue,” said Ulrich Salzgeber, CEO of the Steamboat Springs Board of Realtors. “Very few of the properties that are available on Airbnb and VRBO would even be affordable to an entry-level renter.”
A ski town problem
Other resort towns in Colorado are facing the same dilemma Steamboat is: how to provide affordable housing and maintain a neighborhood’s character while trying to keep up with growing numbers of visitors.
“We’ve been studying this issue for about six years, but it seems like things just keep growing and booming,” said Margaret Bowes, executive director of the Colorado Association of Ski Towns. “It started out as people that just maybe rented out a room in their house to folks that were visiting our communities, but now, it’s investment companies that are buying up multiple condos and renting them out. It’s a business for them.”
Bowes also said the short-term rental business can “be very lucrative” for a second-home owner, which is why many may choose to use a vacation rental company rather than rent to a resort or restaurant worker in the community.
“There are neighborhoods that have historically been locals, and then all of a sudden, your next door neighbor is a different renter every weekend, and that does change the fabric of the neighborhood,” Bowes said. “It sticks out like a sore thumb when all of a sudden you have a new neighbor every week.”
As for measuring the problem, Bowes said the industry has grown faster than governments have been able to study it.
“It’s always been anecdotal about how much long-term workforce housing we have lost to short-term rentals,” Bowes said. “We’ve just kind of lacked some good hard numbers.”
However, some Colorado communities have conducted studies to better understand the problem and placed limitations on short-term rentals.
“In Aspen, we’re starting to see some of the unanticipated neighborhood impacts, like parking and noise and wildlife and trash management,” said Phillip Supino, the city of Aspen’s director of community development. “Some of these issues are starting to bubble to the surface for us in a way that they didn’t previously.”
To address those issues, Aspen has required owners of short-term rentals to obtain a business license, just like any other business would. Owners are also required to pay the same lodging tax hotels pay. Once the owner applies for the license, they’re put into a database, and city officials use that database to limit where short-term rentals can be located.
“In destination communities like Aspen and Steamboat, there is a very high demand for short-term rental products and lodging products,” Supino said. “That can command a higher revenue for a property owner than a long-term rental product could.”
Breckenridge also uses a similar system to track how many short-term rentals are in town, which they began using after town leaders received numerous complaints about trash, noise and dwindling options for affordable housing.
“The key in my mind is balance. Short-term rentals don’t survive without the employees that live in the long-term rentals, and when there are no employees to work in town, people won’t want to come,” Breckenridge Mayor Eric Mamula said. “But we are a short-term rental community. We don’t have big hotels. So I think our goal is balance. That’s why this is going to be a wealth of programs and strategies. … This is the biggest problem that we as a council will face.”
To reach Alison Berg, call 970-871-4229 or email aberg@SteamboatPilot.com.
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