Short-term stays ignite a long-term problem

Rise of nightly rentals make addressing affordable housing shortage more challenging

Park City is one of the most popular vacation destinations among western mountain towns, bringing an influx of tourists and second-homeowners and reshaping what it means to be a part of the community.

Nightly and short-term rentals have been on the rise for years, particularly since 2016, as visitorship increases. With the shift in housing stock, many residents living here — and the workers needed to keep businesses running — are the ones left struggling to find suitable accommodations.

During the economic downturn of 2008, many people bought homes in Park City and converted them to secondary residences. Jason Glidden, housing development manager at City Hall, said that today, only 30% of the homes in Park City are considered primary residences.

Vacation rental company Airbnb, which started the same year, became an instant hit because it opened towns to larger crowds. Services like Airbnb allow homeowners to independently manage their properties — and earn additional income by renting them out on a short-term basis. Short-term rentals are often much more lucrative for property owners than renting out their units on six- or 12-month leases.  

The number of short-term rentals, which are units where guests stay no more than 30 consecutive days, have increased significantly over the last several years. There are currently 2,400 licensed nightly rentals in the Park City limits, but Glidden estimates there are an additional 1,200 units that are unlicensed. Licensed units are required to undergo health and safety inspections to ensure they’re up to code. 

With the rise in nightly lodgings and short-term rentals, seasonal workers are struggling as long-term accommodation is hard to come by. 

Pat Matheson, executive director of the nonprofit Mountainlands Community Housing Trust, which helps people find affordable housing around Summit County, said that 99% of available long-term units are consistently occupied — leaving workers coming into town with few options.

Only 15% of Park City’s workforce lives in the city limits, Glidden said, and the low inventory of housing makes available rentals harder to track. But as the price of real estate continues to rise without similar wage increases, the disparities will only continue to grow.

To mitigate the difference, area employers, including the Park City government, try to secure affordable housing for employees as a recruitment method.

“If you can’t attract employees, you can’t provide services. That’s detrimental to the economic future,” Glidden said.

Old Town, in particular, has become a hot spot for short-term rentals. For residents living there full time, it’s challenging to build relationships with neighbors if people are constantly coming and going. And that’s something officials say puts the community’s vibrancy at risk. 

Until the last 15 or 20 years, the majority of homes in Park City were primary residences, but now neighborhoods are littered with homes that sit vacant much of the year, or where short-term renters come and go. When the homes are in use, year-round residents can be bothered by visitors who are often noisier or produce more trash than long-term renters. 

Both Glidden and Matheson agree that a sense of lost community and a workforce that doesn’t live in town impacts the overall social equity and diversity of Park City.

City officials face several obstacles when it comes to addressing the problems associated with nightly rentals, but the biggest hurdle is incentivizing owners to offer long-term leases instead of chasing bigger profits.

Glidden said they’re looking to other resort cities for ideas. For instance, in Big Sky, Montana, a new program offers landlords money to convert short-term rentals to long-term housing. The program helps make up for the difference in income so property owners still receive a return on their investments. 

If long-term rentals are considered primary residences rather than secondary, property owners will also see tax breaks. 

The city is looking at offering deed restrictions that would increase the number of people living in the city similar to a program in Vail, Colorado. The program could be utilized as down payment assistance to help increase long-term housing options for those who might not be able to afford it. Property owners would be paid cash to live in the homes or for offering six-month rentals.

Another possibility could be the adoption of ordinances that restrict nightly rentals in certain zones within Park City, but state law currently prohibits local governments from stopping rental operators from listing properties on websites or banning them in.

In 2016, the city set a goal of creating 800 new affordable units by 2026, or nearly 80 units a year, to maintain the community’s anticipated growth. Glidden said as they continue working toward the objective, they look to sponsor projects or work with private developers who are obligated to make 20% of units affordable. 

Officials are also considering changes to development codes, such as a proposal that would allow businesses to build accessory dwelling units to house employees, for solutions.

But the biggest challenge is balancing the need for affordable housing with locals’ perspectives on density and the desire for open space. Glidden said that to achieve the city’s goals, there needs to be a community conversation about development in areas where it’s appropriate.

Matheson agreed that there are technical solutions to the problem, such as building and financing, but there are growing pains associated with development. 

“How do we grow in a way that’s both sustainable and addresses affordable housing issues?” Matheson said. “I think that we can work together. I think that the best outcome for our community is one where we acknowledge (conservancy and development) and say we can do both.

“A community is built on people, and people who are committed to each other can find solutions to these other things.”