Investor (or corporate) single-homeownership has an adverse effect on individual homeownership. Research indicates that investors, often paying cash, outbid individual homebuyers. According to this research, the increasing presence of investors in the housing market explains over half of real house price appreciation between 2006 and 2014, and the decline in homeownership (6).

I digress a bit with the national housing market detail because the same mechanisms functioning nationally are operational locally in Saranac Lake. Homeownership is declining due to residential “investment.” Many discussions regarding our housing crisis refer to “work force housing.” It’s as if these residents who have few options for rentals, and none for ownership, aren’t regular people — they’re “workforce.” Seems derogatory. Most of us work, and we all need housing. Without options for ownership, there is little incentive to stay here — see net worth for middle class families, in Part I. The result, among other things, is local residents complaining about the difficulty and/or expense of finding a tradesman to work on their home, or an employee for their business.

According to the recent article in the ADE (11/27/24) and the correction of same (11/29/24) there will be approximately 126 units (individual living spaces) marketed as vacation rentals in the village, whether houses or apartments. That total requires precise verification, and it doesn’t include illegal (unpermitted) STR’s currently operating.

Once a housing unit enters a corporate or individual investment portfolio, it’s not coming out. Therefore, as the number of STR’s / vacation rentals creeps incrementally upwards, the number of families and children residing here correspondingly declines. When I was a senior, Saranac Lake graduated about 147 students, and the number was similar in Lake Placid. OK, so that’s ancient history. In October of 1998, SLCSD had 126 seniors and Lake Placid had 71. Last year, that number was 90 seniors in Saranac Lake and 38 in LP (7). If you want to understand the ecology of a village, count the kids. More children define a healthy social ecosystem while fewer indicate a community in decline.

Vacation rentals or STR’s are not the sole cause of this decline. Sure, you can argue birth rate, population trends and demographics. However, we have several apartment buildings in Saranac Lake now emptied of tenants and converted to vacation rentals, and of course, many houses too. In June of 2022, the Steamboat Springs City Council passed a ban on new short-term rentals and a ballot measure to tax the industry at 9% to fund affordable housing.

“There is not a day goes by that I don’t hear from someone … that they have to move because they can’t afford rent,” said Heather Sloop, a council member who voted for the ordinance. “It’s crushing our community (8).”

Lake Placid has gone the way of Steamboat, Tahoe or Mammoth and sold their birthright. Placid recently placed restrictions on vacation rentals but the decision came too late. That birthright is a family’s ability to own a home and raise children in this wonderful place, and for the next generation to do the same, a legacy nearly finished in Lake Placid and rapidly diminishing here. Note that retirees are facing the same housing problems (9). A few locals have placed deed restrictions on their homes preventing future conversion to STR’s. Kudos to them. Saranac Lake is surrounded by undevelopable land, a situation which exacerbates affordability. So why make housing in the village less affordable and less available by converting more of our already limited housing stock into vacation lodging? These are the most consequential decisions in Saranac Lake’s history. Make your voice heard.

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Dan Reilly lives in Saranac Lake. A list of sources accompanies this commentary online.

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Sources:

(6) https://www.philadelphiafed.org/the-economy/banking-and-financial-markets/bt-the-rise-of-the-single-family-reit

(7) https://data.nysed.gov/archive.php?instid=800000051779

(8) https://www.pbs.org/newshour/nation/vacation-towns-limit-short-term-rentals-amid-housing-crisis

(9) https://www.businessinsider.com/baby-boomers-housing-wealth-home-prices-housing-shortage-retirement-2024-11