Property should be an accessible necessity and yet the most expensive 20% of owner-occupied homes currently makes up over half of the total value of US housing stock. Affordable housing is an issue reaching crisis level in Colorado where resorts rely heavily on luxury properties and holiday homes. In Vail, the population of roughly 5,000 permanent residents is doubled by part-time residents in vacation properties, and general population growth, coupled with a predicted rise in the number of local jobs, is putting a strain on the available housing inventory. The issues of housing shortages and the affordability gap in mountain resort towns are however being addressed and will be top of the agenda at the inaugural US Mountain Community Summit to be held in Vail early in the new year.
Rising Prices and Increasing Equity
Vail Valley has seen steady sales of real estate over the past year with the number of transactions this year nearly identical to 2017 and the value of sales only differing by $0.14 billion. Sale values have been boosted by the high-end of the market with several successful multi-million dollar deals on condos in Vail. Market trends have indicated a rise of 46% in median house sales in Vail over the last year which is encouraging, and for some permanent residents this can result in a build up of significant equity which older homeowners can then access through loans.
Shortage of Affordable Housing
In contrast, despite a constant level of property transactions over the past year, Vail has also seen a growing number of properties described as seriously underwater. This is a category of property where the balance of loans is at least 25% higher than the property’s market value. At 15%, Vail currently has the second highest percentage of homes in this situation in Colorado. In addition, there is a general shortage of workforce housing in Eagle County. Price rises means buying a house is beyond the means of most local residents, and the County’s cost of living index is pushed up by its large housing costs.
Keeping Local Residents Afloat
This affects the whole community, with rising rents and low vacancy rates leading to high staff turnover and reduced productivity for local businesses. Solutions put forward by local businesses include an equity share model offering a way to for people to get a foot on the property ladder. Vail also aims to add 1,000 deed-restricted, affordable units by 2027, with one such project open to new residents at the end of last year.
Affordable housing is an ongoing issue for the Vail community and other mountain resort towns, and in the New Year, it will top of the agenda at the Mountain Community Summit. Through raising awareness of this matter and making plans to tackle it, Vail can remain a thriving community in which to live and work while, at the same time, maintaining its status as one of the finest resort destinations in the world.