Affordable Housing in Un-Affordable Vacation Towns
BY: Nicole Rosker, RBFL Editor
Every winter, almost 1.5 million people visit Aspen to ski its legendary slopes. Every summer, Martha’s Vineyard’s population springs from 17,000 to 200,000. These famous destination towns are so successful at attracting affluent vacationers that they enjoy nicknames like “Billionaire Mountain” and “Hollywood East.”
But stripped of their romantic infamy, these towns tell a different story, one of inequality: where the wealthy play and the lower classes work and struggle to find housing. Luxury real estate, seasonable demand, and limited opportunities for building development make these areas famous and beloved by many—and unlivable for the locals who keep these towns operational. Without sufficient affordable housing for their workforces, places like the Vineyard and Aspen can neither sustain their communities nor keep pace with the tourism industry—leading them straight into an “existential crisis.”
One strategy: impose a transfer fee on the purchases of homes in these areas and use the money to fund affordable housing developments that focus on refurbishing existing properties.
Look to the Coalition to Create the MV Housing Bank, who is proposing a local real estate transfer tax that would impose a 2 percent liability on homebuyers purchasing homes on the island worth more than $1 million. The proceeds would go to a housing bank and be used to generate new affordable housing on the island—75 percent of which must be created by rehabilitating existing developed properties.
Local real estate transfer taxes are difficult to pass, as the state must have a home rule provision—which grants autonomy over local matters to local authorities—and the state must recognize a home transfer tax as one that can fall under local authority. This faces opposition from those who argue that maintaining uniform rent regulations is a statewide concern. There is also criticism that RETTs are unfair and unreliable and discourage mobility for new homeowners.
However, Aspen already maintains a successful local RETT. The town strictly regulates building development to preserve its small town feel and “Aspen brand.” These restrictions create scarcity that drives up home prices, but Pitkin County’s RETT redistributes wealth to affordable housing initiatives that create housing for Aspen’s workforce.
Nevertheless, Aspen routinely struggles every winter to find enough housing for its workforce. A dedicated focus on acquisition-rehabilitation projects may be a way to work around the limited development opportunities.
It may not be efficient or profitable for large projects—and it could be limited by how many existing properties a housing bank can wrangle—but it is a strategy that would preserve the unique attributes of a small community. In fact, part of the success of Aspen’s affordable housing initiative is due to the land use regulations that make real estate so expensive—for they also ensure that affordable housing developments maintain the ski resort’s unique charm. It could also be a defense tactic against cold homes—that sit empty much of the year—and short-term rentals—that drive up rental prices—if a local housing bank can buy back these vacation homes and re-position them as year-round community housing.
The final challenge to an affordable housing initiative is implementing long-term restrictions that ensure the affordability and year-round use of these housing projects. These restrictions are critical to ensure that this housing is used by those who need it and used in a way that strengthens the town as a community, not a seasonal resort.
The success of any affordable housing strategy in a destination town depends on the ability to balance the preservation of the town’s character with the development of workforce housing. These towns may cater to thousands of tourists annually, but to solve their local challenges, they need local answers.
Sources:
Jan G. Laitos & Heidi Ruckriegle, The Problem of Amenity Migrants in North America and
Europe, 45 Urb. Law. 849, 849 (2013).
Act Establishing the Martha’s Vineyard Housing Bank, Coal. to Create The MV Hous. Bank, 4-5, https://static1.squarespace.com/static/6014884e0037306100c34a6f/t/623f0cbf07e95b37e78097f4/1648299200361/An+Act+Establishing+the+Martha%27s+Vineyard+Housing+Bank+%28Draft+3-24-22%29.pdf
Jenny Stuber, Aspen and the American Dream, 19:2 Am. Sociological Ass’n, 34, 35 (2020).
Elizabeth M. Tisher, Historic Housing For All: Historic Preservation as the New Inclusionary
Zoning, Vt. L. Rev. 603, 618 (2017).
Virginia Sargent, Let Cities Decide: End Colorado’s Prohibition on Rent Regulation, 92 U.
Colo. L. Rev. 337, 351 (2021).
Marissa J. Lang, On Martha’s Vineyard, even the doctors can’t afford housing anymore, The
Wash. Post, (Sept. 16, 2022), https://www.washingtonpost.com/dc-md-va/2022/09/16/marthas-vineyard-housing-rentals-crisis/
Heather Hansman, What ski towns tell us about the inequality crisis, Deseret News, (Feb. 8,