Do Archuleta County taxpayers know what the County STR Task Force is doing?
It’s been five months since the Board of County Commissioners (BOCC) discussed the Task Force Phase I Report on the status of the local short-term rental (STR) market density. The same day (March 14 2023), the BOCC voted to not reinstate an expired moratorium on new STR permits.
During the past five months, the median closing price for homes has dropped 8% – 14% depending on which monthly CERN MLS report we reference.
In April, May and August, home prices were down (year-over-year) by about about $50,000 (-8%).
In June, home prices were down (year-over-year) by about $90,000 (-14%).
There has been public debate on how much PPP Federal stimulus money was spent to purchase homes in an effort to create passive income for savvy out-of-town real estate investors. I think I read that 80% of the STR’s in Archuleta County are owned by out-of-town real estate investors.
The theory of “trickle-down economics” was been refuted by scholars as an ineffective way to grow an economy, because cutting the taxes for the wealthy often does not translate to increased employment, consumer spending, and government revenue in the long term.
Many, including myself, believe that the best way to grow the economy is from the middle out, and the bottom up.
Allowing out of town real estate investors to buy up local scarce inventory of homes, is a misguided belief that after a few local businesses (realtors and realty property managers) take their transactional “cut of the STR action”, out-of-town STR landlords take their passive income home (many local STR owners live in Texas), that somehow the ‘trickle-down spending’ is a greater local benefit than the negative impact of unaffordable housing for all residents — who must also pay the majority of inflated property taxes.
A more prudent (middle out, and the bottom up) approach would be for local government policy makers to not treat shelter as an investment platform for wealthy STR investors who disregard single-family residential zoning laws, and disrespect the expectations of neighbors — neighbors who work hard to raise families and who depend on single-family residential zoning laws being followed.
I appreciate local government leadership pointing out (5 months ago) the unnatural rate of growth of STRs during 2020 and 2021. I read on a popular STR website that tourism drives occupancy rates, and remote work policies drives up Average Daily Rates (ADR). Savings rates are now at an all time low (PPP stimulus money is quickly being spent), and mortgage rates are now much higher than during 2020 and 2021. Corporate work policies are now requiring that all employees be in a corporate office environment — at least a few days every week.
Now that the COVID “hang-over” is apparent, it is hard to believe that STR occupancy rates and average daily rates will not continue to decline. Maybe an ‘AirBNBust’ event is not happening in Archuleta County, but an STR decline to the degree that the median closing prices for STRs sold could be down 8% – 14% depending on which monthly CERN MLS report you pick.
Perhaps this is what County Manager Derek Woodman was referring to as a “natural adjustment to the market”, in order to correct for unnatural rate of growth in STRs during 2020 and 2012.
I ask, “Do Archuleta County taxpayers know what the County STR Task Force is doing?”… because five months ago the Task Force implied a number of actions would be completed. For example, collect of data over 12 months (no moratorium on new STR permits), meet regularly to go over collected data, and most importantly to create a mapping tool for displaying all known STR properties.
This last deliverable promised by the Task Force was pointed out by the Task Force itself as very important in order to improve transparency with Archuleta County taxpayers. On February 7, 2023, it was estimated by the BOCC that 62 non-permitted STR properties existed. Five weeks later (March 14, 2023) the BOCC estimated that approximately 100 non-permitted STR properties might exist.
We are now almost half way through the requested 12 month period of time for the STR Task Force to collect data, and go over data. In October 2022, new software was purchased to monitor and track the number of permitted STRs, and to monitor and track the number of illegal STRs.
Presumably the creation of an STR Mapping tool — for both permitted STRs, and illegal STRs — might now be required to complete the remaining deliverables promised by the STR Task Force.
That being the ability to analyze the effectiveness of the new STR policies and recommendations.
The STR Task Force Phase I Report (page 7) noted that in the past “very little has been done to ensure compliance of non-permitted STR properties”.
A mapping tool, made available to Archuleta County taxpayers, could help ensure better compliance with policies and recommendations.
A publicly available online mapping tool would provide the public with a means to inspect neighborhoods, and provide feedback on any STR activity inadvertently missing from the Archuleta County STR data base. I’m surprised the Task Force, BOCC, and our County Manager are not requesting public assistance in order to have a more accurate STR count, and to better understand the effectiveness of any new policies and recommendations.
Hank Lydick took ‘early’ retirement to build a home in Austin, Texas, and a cabin in Pagosa Springs, Colorado.