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Our community and vacation rentals

Over 20% of water and sewer bills in the village of Saranac Lake are now mailed out of town. I hope that got your attention. It’s a big number. The percentage in Lake Placid is much higher. These simple statistics represent a significant demographic change that has accelerated in the past 10 years. It’s a big change to the place I grew up. It is the loss of our community.

I’ve read with interest the recent articles and letters on such topics as the lack of affordable housing, staffing shortages and the very slow, ongoing debate as to whether or not vacation rentals require regulation. The news here is that the horse is out of the barn, or in the original version of that old saying, it’s time to lock the barn door now that the horse has been stolen.

It is my direct experience that every street in our village has at least one property which is non-resident-owned. Some streets have multiple. If there are any streets without such second homes, the exception proves the rule. This is about the degradation of what we think of as our hometown. As one local resident in Lake Placid described it to me, she no longer knows who her neighbors are. There is always a different group next door with red party cups in hand.

The image you have in your mind of Saranac Lake is something like this: a beautiful place composed of working families and retired seniors who together participate in a small but vibrant community where children grow up bright and strong. That image is no longer so accurate as it once was. It is still a great village, but these changes in property ownership are rapidly transforming that image in your mind. It takes a village to raise a child — so goes the famous and sensible African proverb. A village is not made up of vacation rentals stuffed full of partiers with red cups in hand.

Lake Placid now has an estimated population of 2,386, a number in decline. Out of approximately 1,985 housing units, 422 are owner-occupied. That’s 21%. We don’t know how many are vacation rentals. As retirees sell their homes, non-resident buyers pay high prices soon after the properties come on the market. Like I said, in Saranac Lake it’s every street, not just waterfront. These are wealthy people with two and three homes. There are now over 9 million of these homes in the U.S. To a lesser degree than Lake Placid, the same steady trend is occurring in Saranac Lake and Tupper Lake. The stats vary by source but are directionally clear. Saranac Lake has about 2,492 housing units, of which 1,366 are owner-occupied, or 55%. It’s just a matter of time. Watch the newspaper legals. There is a cutely named LLC announced almost daily as single-family homes are converted into profit centers.

Nationwide, thousands of homes foreclosed in 2008 and 2009 are now owned by incorporated investment groups. Lawyers and investors found great opportunity for profit on the backs of those who lost their most important asset. Commensurate with this sea change in home ownership is a nationwide shortage of affordable housing. What we think of as the middle class is diminished as owner-occupied housing is reduced. Hence, among other reasons, the widening gap between the haves and the have-nots. A higher density of Airbnb, HomeAway or Vrbo listings in any given area overlaps with higher home prices, higher rental prices and lower rental vacancy. Along with noise complaints and parking issues, there is a lack of workers because they cannot afford to live here. I don’t think we need consultants to explain this. We need vision, and political will.

The lure of profit overcomes any twinge of conscience, therefore the need for regulation, the need to lock the barn door. Vbro has 596 listings for vacation rentals in or around Saranac Lake. No one knows the actual total number. Locally, many folks, including some of our political leaders, are involved in the vacation rental business. These are people you and I know and who are our friends. They often do not realize that this growing niche in the real estate market is the death knell for what we like about the Tri-Lakes, that image in your mind. Arguably, vacation homes are a luxury and as such deserve higher taxation, whether rented out or not. But that is not the case. To the contrary, the IRS allows tax deductions for mortgage interest on second homes. Since 2014, New York City has tried to enact a tax on non-resident homeowners, a move opposed by the real estate industry because it would hurt the second-home market. According to the Fiscal Policy Institute, this type of tax is gaining popularity around the world to ensure that wealthy individuals pay their fair share. Maybe this is an approach that could be considered locally.

The current lack of determinate and coherent regulation for vacation rentals is an annual loss of thousands of dollars in taxation and permit fees for these properties. In this sense, the horse wasn’t stolen. We gave it away to someone we don’t even know, and they already had a horse. This loss of municipal income further burdens the local taxpayer. As this trend continues, expect higher taxes, further staffing shortages for elder care and health care, and reduced availability of such basic services as car repair, plumbing and construction. I feel fortunate to have grown up here when I did. Families today experience the joy of seeing their children and grandchildren growing up in such a great place. To them, my neighbors, I say enjoy it while it lasts.

Dan Reilly lives in Saranac Lake.

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