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Summit County’s housing problem isn’t new, but if you’ve been one of the many residents trying to find a place to live in the past year, it’s been no easy task.
County officials gathered Thursday, April 29, to listen to a housing needs presentation by the Summit Combined Housing Authority. Consulting firm Economic & Planning Systems presented their findings after conducting a housing study from March 2019 to March 2020. After a yearlong delay due to COVID-19, Economic & Planning Systems representatives David Schwartz and Rachel Shindman showcased the data, which highlighted the region’s current housing needs.
A look at Summit’s housing supply
In general, Shindman said 70% of the county’s housing supply is vacant homes and 30% is occupied housing. From 2010 to 2018, which was the most recent data available when the study was commissioned, Shindman said these percentages were exacerbated because long-term housing was not added to the market.
The problem was further worsened by the fact that non-residents are driving up the price of local home sales. Between 2016 and 2018, non-residents purchased 35% of new inventory on the market.
“What we’re seeing, especially in sales prices, is that this level of second-home ownership is really driving the price locally up and leaving locals and the workforce behind and a lot of times pushing the workforce out of the county,” Shindman said.
So how much are short-term rentals playing a part? According to Shindman, it’s definitely a contributing factor.
“Using 2019 data, there were nearly 10,000 units listed for short-term rental in the county, so that’s about a third of the entire inventory and half of the vacant inventory,” she said. “That is also impacting the housing availability and affordability for locals.”
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A look at Summit’s housing demand
So how many people are vying for long-term rental units and for-purchase housing? In addition to examining the county’s housing supply, the report included information regarding the county’s demand, particularly in regard to its workforce.
Shindman said that in the past nearly 20 years, employment in the county has been growing, specifically in the year-round sector. The seasonal workforce has remained consistent during that time, she said.
This growth isn’t spread out evenly among industries. Shindman said by 2018, the county had “recovered its pre-recession peak employment.” Most of these gains were in art, entertainment, recreation and health care. Industries like retail, accommodations and food service remained relatively stagnant. Construction, IT, finance and real estate all decreased in overall employment since 2001.
“When we look at these industries, we look at the average wage associated with them, and we see an increase in lower wage jobs,” Shindman said. “That combined with increased pressure on prices and lower inventory — we can see how all these puzzle pieces are fitting together.”
But what about the retiring workforce? Shindman said this population places an additional demand on the county’s housing needs, especially because the number of individuals 65 and older in the county has quadrupled since 2000.
“A large portion of this population is already cost-burdened,” Shindman said. “There’s two ways for that to move forward into the future: Either those people are going to move onto a fixed income, or they’re already on a fixed income, so the pressure for them to pay for their housing is going to get worse.
“Or the pressure to continue working later and later will continue to bring in income to pay for a higher cost of housing. This also has an impact on the type of housing demanded, whether it’s more accessible, closer into town, (a) smaller unit.”
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How much housing does Summit need?
Schwartz, with Economic & Planning Systems, said these housing gaps can arise from a lack of inventory, limited land and a lack of availability due to second-home ownership or use of housing as short-term rentals. These gaps are where housing units are needed the most.
Schwartz said Summit, Eagle and Lake counties all lack housing to meet the demands of their workforce. The data he presented is based only on the year-round workforce and does not include the needs of the seasonal workforce.
Currently, Grand, Clear Creek and Park counties are acting as housing suppliers to nearby counties with housing shortages.
According to the report, the region, which includes Summit and four nearby counties, has a gap of 2,400 units, a number that is projected to double by 2023.
When factoring in affordable for-sale and rental projects currently under construction or already completed, Schwartz said Summit County’s gap is 725 units. Over the next five years, that number is projected to balloon to nearly 2,400 units. This number accounts only for affordable projects as of March 2020 and does not include projects announced thereafter.
Within the county itself, Schwartz and his team determined that the Breckenridge, Blue River, Frisco and Copper Mountain areas are in need of the most housing.
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Housing preferences among residents
In addition to collecting data about the county’s housing market, Economic & Planning Systems also conducted a survey to garner information about the preferences and needs of certain populations.
In that survey, 1,775 responses were compiled — 57% from owners and 40% from renters — with almost one-third of respondents saying they spend over 30% of their income on housing and 39% saying they are “cost-burdened,” Schwartz said.
For the presentation, Schwartz lumped respondents into three categories: working adults with children, working adults without children and retired or soon-to-be retired adults. Schwartz said this was to identify needs and preferences among the different groups.
According to the survey, working adults with children are looking for two to three bedrooms and two bathrooms with privacy and space for their family. Working adults without children are looking for two bedrooms and 1.5 bathrooms with storage and pet-friendly environments. Retired or soon-to-be retired adults are looking for two bedrooms and 1.5 bathrooms with storage and quality finishes. This group also wants to be closer to town.
Next steps
At the end of the presentation, Summit County Commissioners Elisabeth Lawrence and Tamara Pogue asked Schwartz and Shindman what the county’s next move should be to start mitigating the housing issue. Lawrence proposed a subsequent meeting so county officials could begin brainstorming strategies to implement in the near future.
Lawrence also suggested introducing some sort of incentive that would encourage short-term property owners to switch their units to long-term rentals.
Silverthorne Mayor Ann-Marie Sandquist also brought up the idea of taxing short-term rental properties as commercial properties. She noted that this was opposed by the local real estate industry and that a similar idea died in the state Legislature last year.
Breckenridge Town Manager Rick Holman also voiced his support for uniting the towns and county to begin a collaborative effort to tackle the issue. Holman noted that short-term property owners aren’t “the bad guy,” and Amy Priegel, executive director of Summit Combined Housing Authority, echoed his thoughts.
“One point I do want to make though is we’re not saying that second-home owners are bad,” she said. “We’re not saying that short-term rentals are bad. What we’re trying to do is find that balance.”
The report concluded in March 2020 and does not include the impacts of the pandemic, which has also compounded the issue. To understand those full effects, Priegel said the Northwest Colorado Council of Governments is conducting its own study to determine the impact of the virus on resort communities. Priegel said the report’s findings would be available in June.
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