Short vs. long term rentals are on a lot of minds

for-rent-SQWhile the jury seems to be out, locally, on just how much of an effect short term rentals through AirBnB, VRBO, HomeAway and other means are having on our region’s long term rental markets, one thing is for sure — the possibility is firmly on people’s minds. Moreover, the fact that the one market can affect the other has been established in such big city real estate scenes as that of San Francisco, Los Angeles, and increasingly New York.

“When you have a limited supply of apartments, and unlimited demand for those apartments, turning some apartments into hotels makes the remaining ones even more expensive. Sure, the city should build more apartments. But absent effective law enforcement, there’s no guarantee that Airbnb users won’t turn those into hotel rooms, too,” noted Nicole Gelinas, a contributing editor to the Manhattan Institute’s City Journal, in a June New York Times discussion on the subject. “Airbnb’s argument is that the company actually helps people deal with ever-rising rents, by allowing them to provide lodging from time to time for a little extra money, is economic nonsense.”

“It’s apples and oranges, this comparison of short and long term rental markets up here,” countered Saugerties realtor Steve Hubbard, who echoed Woodstock realtors who said last week that they saw nothing but good coming from the Airbnb and similar phenomena. “These places give people the opportunity to have the local experience as part of their stay. They come because they want this way of being in a place, and many of them end up wanting to move here.”

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Elda Zulick of Grist Mill Realty elaborated on what Hubbard talked about, noting how she, like him, has several properties she rents short-term.

“All of us do rentals for the HITS crowd each summer, and we recommend that those looking for something long term do so not during those months,” she said. “But we also point out that the County Multiple Listings Service now has rentals, by town.”

That county MLS listing for Woodstock showed 35 listings when we looked, ranging in price from $4,000 and up a month down into the $900 range for one bedroom cottages. But many are for winter only, with deals ending for seasonal money-making opportunities come Memorial Day.

A look at neighboring communities showed one offering in Shandaken, at $2500, four in Olive averaging between $1200 and $900 for full cottages or two bedroom apartments; 11 houses in Hurley, ranging between $2400 and $1200, with very few carrying the “seasonal” warning, and 25 in the town and village of Saugerties that ranged down from $3000 to the $750 range for apartments.

“Everyone’s affordability if different; if someone comes to us with a rent that feels too high for them we talk to them, or to the landlords we’ve recommended, to try and decrease the impact,” said rental assistance director  Vanessa Secore of RUPCO, Ulster County and area’s leading housing agency. “Seasonal aspects can affect rent prices and availability but not that much, from what I’ve seen.”

RUPCO’s program, which Secore explained was working with about 40 clients per month these days, tended to find HUD-financed assistance for people based on willing landlords. And most of their demand, she added, was for communities with medical facilities, bus routes, shopping and other services in walking distance, and options for employment.

Which is just what many in and around Woodstock said was now missing from the rental mix in the center of town, especially during summers…or at least full year rentals without having to leave for several months.

 

Supply problem

“Finding an affordable place to rent is tough for middle-income and low-income people in every American city. In the San Francisco region, and 16 other metro areas nationwide, more than one in four low- and moderate-income households spend half or more of their income on rent,” noted National Housing Conference president and CEO Chris Estes in that same NY Times discussion last summer. “Fundamentally, our rental affordability crisis is a supply problem. We’re simply not building enough rental housing to meet demand, particularly in job centers, and especially for low- and middle-wage workers. Taking rentals off the market only makes a bad situation worse… Airbnb seems poised to grow, and local governments should monitor its impact on the housing market to take regulatory action as needed.”

Addressing the issue from as macro- a perspective as we tend to get in Ulster County, goverment-wise at least, County Planning Department director Dennis Doyle said that discussion is starting about what constitutes residential and commercial structures in towns, villages and cities, including studies of how long people tend to live in a place and what effects different length sojourns might have.

“There’s been discussion of taxing, and talk about the hotel tax issue in the county executive’s office,” Doyle continued. “We’ve also been keeping an eye on what’s being said in New York City and other places about all this. It is a phenomenon, we are a destination — which is a good thing. But beyond that it’s hard to say.”

The county planner went on to note that while there seems to be some correlation between short term rentals and centers for second homes, he’s not yet aware of any major demographic shifts going on in terms of rental markets.

“That said, I do have to note that Kingston’s been becoming much more attractive to people now. But that seems to be for long term residents,” Doyle added.

Secore, at RUPCO, echoed her fellow employee Guy Kempe, who addressed short term rentals last week, by talking about the region’s long history of boarding houses, summer bungalows and second homes. But then she reiterated her findings: that most who seek her agency’s services want an accessible area, unless they have cars. But even then they like Kingston, Saugerties, New Paltz and Ellenville over more rural locations.

“There are clusters, definitely,” she said.

But also rentals everywhere, we found when double checking this publication’s own classifieds again this week.

“We know that the rise of informal vacation rentals in high-demand cities has an impact on housing supply, even if we can’t quantify it perfectly yet. Those cities are experiencing surging competition for housing, and rising prices are only worsened by removing residential units from the market,” added Sarah Watson, deputy director of New York’s Citizens Housing and Planning Council, and author and manager of the Making Room initiative, which looks at new ways that cities can match their housing stock with the needs of their population. “At the end of the day, the goal should be to make sure that residential units are not being taken off the market in areas where demand for housing is already outpacing supply. In those areas, extra housing space is more important for residents than for tourists.”

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