There is an almost fetching naiveté to the title of the first chapter of a 17-year-old Housing Strategies Report which, prepared for Ulster County by an applied economics firm out of Vermont, asked: “Why be concerned about housing?”
The later chapters announce sober subjects like “overview of recent housing price trends in the county” and “impact on housing affordability.” Tables place the reader at the center of the exercise, showing the household income needed to afford the expense trifecta of mortgage, utilities, and taxes and insurance. Telephone and Internet costs are excluded.
To make sense of the relative comparisons provided and convey the meaning of the word “affordable,” it’s noted that costs are not to exceed 30 percent of an individual household’s income. That standard elicits a nostelagic smile. Most of America broke through that barrier many years ago, and there seems no looking back.
Above that threshold, according to the U.S. Department of Housing and Urban Development, was the definite indication of housing stress, financially speaking.
More tables demonstrate the decline at that time in population of the county’s young people. Over the preceding decade, more than a quarter of those residents aged 20 to 34 had moved away in over half of Ulster County communities.
“Even if housing-price increases played a less significant role in the loss of young people,” the report speculates, “for many people, they cannot afford to come back.”
The more haunting idea is that there might not be any home to come back to. But being prevented from returning in the first place to see for themselves is worse somehow.
The report’s gloom deepens. “The county’s housing affordability outlook continues to worsen.” And so on.
The report eventually makes the observation which, while it described the past, reeked of prophecy. “The relative price attractiveness of the county’s available land encouraged upper-income households to migrate to the county from less price-attractive parts of the region.”
It did so then, and it does so now. In the intervening years, the problem has only intensified. The 2008-2009 recession relegated a good part of the report to the dustbin of history. The unprecedented employment boom in New York City metro area jobs came to an end. The cost of New York City housing had risen to unaffordable new heights. Many of Ulster County’s young people came home.
And so it has continued to be. New York City rentals, which collapsed in price during the the Covid experience, have since revived at an astonishing speed, an average of $1000 per month jump in a single year. Many more jobs than previously can be done from anywhere. What will that mean for Ulster County?
Gallagher’s Polaroid
Just a few days ago, on July 20, Ulster County comptroller March Gallagher supplied the public with a new breakdown of the state of housing in the county. Though it is the spiritual twin of the 2005 report, this one reads with the brevity and impact of a Polaroid snapshot rather than a pile of pages assembled on the taxpayer dime.
The report tells those citizens of Ulster County eager to put the five percent deposit down and enter into a 30-year mortgage to buy a home of their own what they had already suspected. They’d better be folks of considerable means.
There has been a 56 percent increase in median home sale prices between 2019 and May 2022. Homes which were $225,000 in January 2019 jumped in price to $370,000 in June 2022.
According to the NYS Association of Realtors, the supply of homes for purchase has dwindled from 1432 homes for sale in May 2019 to 652 homes for sale this June. But even that sparse supply marked an increase in percentage availability over the previous hot market.
Ulster County residents now find themselves within the eye of an inflationary spiral.
Woe to the renter
According to the Ulster County planning department, more than a quarter of the county’s population lives in rental housing, which in 2022 represents the housing choice of necessity for most low- and moderate-income households. If one cannot pay the price of admission to join the landowning class, then a renter is what one shall be.
Of the 85,372 housing units in Ulster County, 70,005 of those are occupied and 21,702 are rental units.
Just 21,702 places to find a roof and four walls to start. The actual number of available units whittle the odds down quickly.
The 2020 Ulster County Rental Housing Survey describes a vacancy rate for non-subsidized apartments of just 1.81 percent.
Availability for subsidized apartments is even slimmer. Current county executive hopeful Jen Metzger that as many as 100 people are on waiting lists in some communities.
Whatever the case, the comptroller’s office is aware of 383 individuals in Ulster County who have no place to call home at all.
According to the Ulster County Emergency Housing Snapshot of January 2021, there were 331 persons living in emergency shelters and 52 more living with no shelter whatsoever. Of the 331 sheltered individuals, 216 were adults and 115 were children.
Ah, yes, vacation rentals
Of all the facts and figures stacked one on top of the other to build this dystopian housing pyramid, one building block has more and more attracted the ire of housing advocates and municipal governments across the region. They’re called vacation rentals.
Known in official literature as Short Term Rentals (STR), vacation rentals entail the renting out of anything from just a room in a house to the renting of the entire house, most often to visitors on a jaunt for a short duration. Not only does the transaction command more lucrative prices than a year-long lease, but this arrangement also avoids the landlord-tenant relationship.
Unfortunately, for every property owner that sees the light of this new tourist-driven marketplace, that’s one more property removed from the county rental stock, one less property available to be rented by a resident attempting to build a life here in the Hudson Valley.
“More than anything right now, driving our housing crisis in Saugerties are these short-term rentals,” Saugerties-Ulster county legislator Joe Maloney recently said
Airbnb is presently the most infamous name in the game. Founded in 2008, the vacation pioneering platform with the pay-to-stay model has encircled the globe, squeezing the housing-unit supply like a global scale boa constrictor, drawing outcry and often legal challenges from the populace in every country in which it appears.
The business model of vacation rentals has been singled out from New York City to New Orleans as a primary driver for gentrification, that upward pressure which pushes the price of housing ever higher beyond the reach of those working people already invested in a community and struggling to stay afloat.
“And I really think the vast majority of [short- term rentals] are not little old ladies just supplementing their high property and school taxes,” Maloney noted. He urged care.
“It really needs to be regulated,” he said. “Otherwise, we’re gonna start losing businesses. Markertek, for instance, is one of the big drivers in Saugerties, and they pay a living wage, but if people can’t find a place to live, well, that’s going to force businesses like that to consider moving, and then the domino effect just keeps going.”
Benefits and costs
According to the comptroller’s press release, tourism and hospitality represent 45 percent of all Ulster County jobs created in the last year.
Ulster County has seen occupancy-tax collections grow from $1.53 million to $3.57 million over the last five years, the bulk of the increase since the 2021 implementation of the voluntary collection agreement with Airbnb during the pandemic.
The tax revenues acts as a blood transfusion for a community, a consolation prize for so much of the young blood having drained away.
Welcome as they are, however, they don’t alter the housing-unit numbers. The short-term rentals, whether a cabin in Kerhonkson or a room in Shandaken, can and do.
Advertised as potential ‘stays’ on the Airbnb website, over a three-day weekend near the end of last September, 361 stays were listed in Kerhonkson. 490 in Saugerties. 627 in Woodstock, and 889 in New Paltz.
There’s some overlap. The same Dome Compound with hot tub, piano and rock-climbing gym for $1650 per night shows up in the searches for STRs in Woodstock and Rosendale even though the address is listed in New Paltz. Destinations like Woodstock have a luxury caché, easy to trade on regardless of the physical facts.
“While [those numbers] are certainly possible,” muses Woodstock town supervisor Bill McKenna, “it also might suggest that people fib a little bit. Every year we have a cap [on STRs]. It’s around 285. And we have a waiting list. I can tell you that we do check and go on the Airbnb site. And we do follow up, and we frequently find that people that live in Glenford or West Saugerties or Shandaken might use Woodstock as an address. So that’s not ironclad.”
Local constraints
Any way you cut it, just shy of 2000 Ulster County housing units are perpetually off the market, leaving desperate would-be local renters in the lurch.
Renting out a property as a short-term rental over a three-day weekend fetches an average price of $333 per night. If a one-bedroom rental these days goes for around $1200 a month, that’s just $40 a day.
Do the math. Listing a property as a short-term rental can clear the same amount in four days that a permanent tenant would pay in 30 days.
Ten municipalities have already adopted STR regulations, including the City of Kingston, Village of New Paltz and the Town of Woodstock.
Kingston, which is contemplating additional change, has redefined short-term rentals as hotels and limited those to specific zones. “If you want to open a short-term rental, you do have to go through the building safety department,” said Bartek Starodaj, director of housing initiatives. “You have to get an inspection, and you have to pay an annual fee. In addition, you can only open a new short-term rental in certain areas of the city. And if you’re outside of those areas, you’re talking about Uptown, you’re talking about the Broadway corridor, you’re talking about the Rondout, you need to get a variance from the Zoning Board of Appeals.”
Woodstock amended its zoning law in May 2019 to include short-term rentals in the same category as bed-and-breakfasts, subject to the same permitting process, required to pass the same fire and safety inspections and to apply for renewal of an operating license annually, register with the county, and not exceed 180 days a year of short-term rentals.
“I do believe that we were the first community in Ulster County to pass a short-term rental law,” said McKenna. “We also have a cap. The cap is around 285, and after that we have a waiting list. We looked at what other some other committees were doing. And, you know, we came up with a law, and we vowed that we would take a look at it. But I think it has helped.”
New Paltz is in the process of rolling out an updated town rental registration law. “The town will be taking up some legislation in the future to address STRs,” said town supervisor Neil Bettez, “but the first step for us was to pass a rental registration law last fall. The law requires all rentals (short and long-term) be registered and inspected so that all units are safe and that we have an idea on the number of rentals in the town so we can base our decisions on actual data.”
The Village of New Paltz and the Town of Hurley ban non-owner-occupied short-term rental units altogether.
‘Non-owner occupied’ most often describes a property where the owner sees property primarily as a generator of income rather than a homestead. Like a stock, the property’s value changes. “If these towns are going to regulate, one of the first things you need to know is how many [you] have and where they are,” explains legislator Maloney. “So that’s something the county has done to help out these municipalities.”
While just three percent of all units total, occupied and rental, are considered operating as short-term rental units, that number swells to twelve percent when rental units alone are considered.
A statewide registry?
Is a statewide registry of short-term rental units in the offing? Things seem to be moving in that direction.
County executive Pat Ryan has asked the Ulster legislature to keep closer tabs on this suddenly ubiquitous industry. The growth of the short-term rental marketplace has left local municipalities scrambling to understand the scope and size of the marketplace within their jurisdictions, the county says. It proposes a pilot study of Town of Lloyd of properties identified as advertising short-term rentals.
The county already has skin in the game. As it stands, every short-term rental transaction entrepreneur must render some coin unto the county, upon pain of litigation in the courts and expensive fines. The county finance department oversees the arrangement.
It has been suggested that a registry of these properties consisting of a list of addresses and names of property owners may be coming into focus. State senator James Skoufis has introduced a bill which attempts to differentiate acceptable types of home sharing from what amounts to running an illegal hotel. State senator Michele Hinchey is a cosponsor of that to senate bill. There is also a provision in the bill for short-term rental hosts to register with the state, but so far this bill only applies to residents of New York City.
Creating a statewide registry, available to the public for transparent review, all the smart set agrees, may be the major scaffolding out of which to build an equitable regulatory code going forward.
Though a significant step forward, dealing with short-term rentals would only be a limited piece of the larger problem of expanding affordable housing availability in Ulster County and throughout the Hudson Valley. Other measures and bigger dreams are necessary as well.
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