Wisniewski: What is a community worth? | Opinion
What is your house worth?
The price is probably wrong even if it already seems too high. It used to be that a potential buyer would note the number of bedrooms and bathrooms, the size of the yard, the quality of nearby schools and, with the help of a real estate agent, come to a decision as to whether the price registration was fair. and what offer to make. Essentially, these types of buyers were wondering: would this be a good home to live in for the money?
In areas of mountains, outdoor recreation, and other natural amenities (as well as fashionable urban neighborhoods), the old math is replaced by the new math. The new calculations determine the fair price of a home based on its projected income as a short-term rental. Houses are not made for living. They are commodities.
Nationally, what was once a $300,000 fair market home now costs $400,000 (or more). The hypothetical mortgage on the $300,000 house could be around $1,000 per month. At $400,000, it’s likely to be around $1,500 per month. The $500 monthly payment increase on this hypothetical mortgage is significant for a family on a budget. But that’s relatively insignificant for a savvy investor, who could expect to earn between $36,000 and $70,000 annually by renting a three-bedroom home on Airbnb, according to national averages. Of course locally we have to multiply all of these numbers by an Aspen factor. Either way, the definition of “overpaying” is different for those looking to live in a home versus those who will rent it out as Airbnb.
A war is underway – sparked by billion-dollar tech companies, whose continued growth depends on communities believing it is more important for tourists to have access to unique, authentic accommodation than for local workers. to have housing, whether in the form of long-term rental or home ownership.
Airbnb’s platform was intended to encourage room and house sharing or allow landlords to rent secondary suites, such as mother-in-law’s cottages. The idea was for travelers to have a local host on hand to welcome them and make them feel more attuned to the community. A less sterile travel experience. Used like this, Airbnb and its ilk would be a boon to any community. But somewhere after its founding in 2008, Airbnb morphed into a hotel competitor due to its marketing budget and ability to slash hotel prices. In many Airbnbs you can check in without ever seeing the owner or anyone else, which I suppose is a godsend now, but was common before COVID and seems to me to be a perversion of the original intention. Many short-term rentals have become decidedly more like hotels.
“One of the reasons why Airbnb is often a cheap option for travellers: running a hotel or bed and breakfast is expensive; taking pictures of your house, apartment or spare room and filling out an online profile is not. Hotels must comply with a litany of health, safety and zoning rules — as well as register with local agencies and agree to collect certain taxes — before they can book a single guest,” according to Wired’s ‘Inside Airbnb’s’. Guerrilla War’ Against Local Governments.”
As a result, we’ve seen the transformation of once vibrant mountain towns and urban neighborhoods into a patchwork of prime residences and unzoned boutique hotels. Even before COVID took interest in Mountain West to unsustainable levels, magazines like Outside were already asking, “Has Airbnb killed the mountain town?” A number of western towns, in addition to Aspen, have become unpalatable mixes of mostly vacant mansions, unregulated short-term rentals, and a dwindling stock of single-family homes and off-the-beaten-path condos. price. In these cities, small businesses are closing and essential services are suffering as rising housing costs force people who do the real work to live further and further from the city.
A neighborhood is a delicate organism. If I turned my house into a cocktail bar, that would change everything. Laws and zoning conventions reflect this. We accept certain limitations on our proprietary rights for the good of the community. We should consider doing the same within the city limits when it comes to allowing the conversion of secondary and tertiary residences into miniature hotels. It’s one thing for an owner-resident to rent out a room, suite, or guesthouse – it’s another proposition entirely for absentee owners or investors to turn communities into revenue-generating vehicles.
I don’t know what the way forward is, but it probably involves careful consideration of zoning and what constitutes “residential use only” and “no commercial use”.