Grand Enterprise Initiative: Yes, it’s an emergency in more ways than one
Grand Enterprise Initiative
The headline last week said it all: “Grand Lake declares crisis.”
A crisis, that is, in the realm of workforce housing because businesses in Grand Lake and the rest of the county are either closing or severely cutting back on hours and service because they can’t handle demand.
These are retail businesses and service businesses.
So Grand Lake hopes that by declaring a crisis maybe it can get in front of a theoretical line for federal or state funding that might help subsidize workforce housing. Good idea, maybe. The problem is that this is a crisis not just in Grand County or the Rockies. It’s a crisis in much of the United States.
This crisis, however, is now having ramifications that may very soon start to dampen the real estate boom that, in part, has been fueling this crisis.
I heard the news just last week that the town of Steamboat Springs is giving consideration to declaring a moratorium on short term rentals. That’s because Steamboat is also experiencing the same crisis, and it’s directly related to the lack of affordable workforce housing in the community, driven in part by short term rentals that are eating up much of the inventory of rental units.
But short term rentals are also driving another aspect of this. Some, but not all, of the buyers are being encourage to purchase homes and units up here because they can help pay for the property with revenue from doing short term rentals. This only increases the speculative fever and drives prices higher, diminishing the supply of properties and putting homes and condos out of reach for regular working people.
Then look at Summit County, just to our south. That’s a place where there’s also serious discussion about how to limit or control short term rentals for the same reasons that Steamboat Springs is considering a moratorium.
It being that Steamboat and Summit County are resort counties that have business and housing trends that tend to presage Grand County, perhaps Grand County interests might take notice. This is a long way of saying that short term rentals and the policies that govern them in the county may soon be under very close scrutiny.
That being said, it’s important to note that much of the real estate purchasing frenzy we are seeing here is also being driven by what I call legitimate real estate demand. By that I mean, not all the purchases are speculative and based on short term rental income streams. Many are for people who really just want to either move up here and own their home or who want to have another home here but not for speculation.
So there’s a double-edged sword when it comes to part of what’s driving this crisis.
I have one client, Alaina Nash, who has now dropped her business and its 100-plus clients because she simply couldn’t handle the demand because of employee issues. And she paid well and she was conscientious about trying to accommodate her workers. That’s many units that may not be cleaned in the near future, angering guests and property owners in the process.
She’s been pleading for a while for help. In her words, she sent this message to on-line travel agencies, web aggregators, crawlers or any platform that digitally links travelers to short term rentals:
“Let’s dive in, shall we? I need money. Not me, personally, but I need your endorsement in the ‘cash’ sense to master the other side of the STR (short term rental) equation and it has everything to do with Long Term Housing. Simply put, we have far too many STR and too few long term houses (LTH) or long term rentals (LTR). What’s the difference? Well, LTH means equity, something you can “own.” Stake in the game, if you will. LTR means you rent or lease, but do not own. We need BOTH and IMMEDIATELY. FEMA camp immediately! But the long term outlook to benefit all of us is to build deed restricted or locals’ colonies where we can all have an opportunity to purchase real estate in the mountain communities we moved to — so we, too, can live, work, play and have the quality life balance to enjoy what others pay millions a year (maybe billions) to travel in to see! We deserve to enjoy it! So, give us the opportunity to own a piece of the pie by helping us build Local Communities in all of the towns mentioned above.”
That’s an appeal to the elusive digital and private sector to help with the problem.
Then there’s an appeal to the public sector. More on that later as it will be prominent in our local news for months to come.
Patrick Brower is the Enterprise Facilitator for the Grand Enterprise Initiative. He offers free and confidential business management coaching to anyone who wants to start or expand a business in Grand County. He can be reached by calling 970-531-0632 or at firstname.lastname@example.org.
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