“If we don’t have housing available… we won’t be the community we want”
You know your city suffers from a housing shortage when rocket scientists can’t find housing.
Agile Space Industries CEO Jeff Max said a recently hired senior executive had been living in a trailer for a month and a half because he couldn’t find a home for his large family. He has a wife and five children.
“We bring in younger guys – I would say our median age is 28 – guys who have graduated from MIT, from Purdue. We hired a guy from SpaceX. They love it here, the mountains, the outdoor opportunities, but lately finding accommodation is proving to be a challenge, ”said Max.
The housing shortage for the workforce is a problem on every radar.
This is the first in a two-part series on the strained real estate market in Durango and La Plata County. Tomorrow, we are following four first-time buyers who are trying to enter the housing market.
An effort is underway to revitalize the Regional Housing Alliance, a quasi-government entity meant to address housing issues that remained dormant in 2017.
Officials from La Plata County, the City of Durango, and the Towns of Ignacio and Bayfield will hold a retreat on August 28-29 to reform the RHA Board of Directors and refine its mission to respond to the housing that has been present in the county of La Plata. for years.
The COVID-19 pandemic has only exacerbated the tight housing market.
Urban flights cause enormous migration across the country from major cities to sought-after rural areas.
The trend has heated the Durango real estate market.
The median price of a home in Durango in the first quarter of 2021 reached $ 583,687, up more than 21% from the median price of $ 482,000 in 2020.
In La Plata County, the median price for the first quarter of 2021 was $ 499,000, up 13.4% from $ 440,000 in the same quarter in 2020.
Plans are underway to deal with the problem.
La Plata County Commissioner Marsha Porter-Norton said the county has $ 10.9 million to use as part of the US bailout, President Joe Biden’s 2021 COVID-19 recovery legislation.
A good part of this sum will be used to alleviate the housing crisis.
“The county has identified workforce housing as the place where we want to put our attention and energy,” Porter-Norton said. “And we’re not going to turn down an opportunity to help with affordable housing projects. Housing for the workforce, as we know, is urgently needed. There is no meeting that I go to where it is not mentioned as our main need.
Durango Mayor Kim Baxter said the city received $ 4.7 million from the US bailout, of which $ 2.9 million remains unallocated.
Baxter said she would be happy if city council spent all the remaining $ 2.9 million of federal COVID-19 relief money to increase the housing stock available for the workforce – housing that could be offered by nurses, teachers, police officers, electricians and plumbers.
“Personally, I would advocate for everything to go towards workforce housing,” Baxter said. “I can see this is a great starter program. “
One of the things needed to build more housing for the workforce is cash up front to pay for sidewalks, sewage, curbs, gutters and streets. The money could also buy land for projects.
Whatever government money that might be applied to the projects will help keep costs down, helping to keep house prices within the reach of a middle-class family.
“If we’re willing to put our money forward, then we’re probably going to get more state and federal dollars because we’re showing our willingness to put our dollars on the line,” Baxter said.
Michael French, executive director of the La Plata County Economic Development Alliance, said the housing crisis is holding back economic growth.
“It’s really hard to recruit or move someone to Durango for an available job,” he said.
The vacancies aren’t just in the restaurant and hospitality industries, which French says is widely recognized.
“It’s in healthcare, it’s in finance, it’s in construction,” he said. “You name it. In virtually every industry we see jobs where we are unable to hire, and housing is probably the biggest factor.
Anyone earning between 80% and 140% of the region’s median income in La Plata County has a hard time finding accommodation that fits their budget, French said.
The average median household income in La Plata County is $ 68,685 for 2019, according to the latest figures available from the US Census Bureau.
La Plata County has always been a desirable location for retiree relocations and second homes, and both of these trends have been reinforced by people speeding up their decisions to relocate due to the pandemic, French said.
Several housing studies are underway. In fact, the Alliance for Economic Development is working with the city to get money from the state for a new project, but French said these studies would do little to ease the current pressure.
“We’re not going to be able to solve this problem by just subsidizing a few projects,” he said. “We’re going to have to find a lasting solution that creates a source of funding that we can continue to build, and then set aside products for housing the workforce, people who earn between 80% and 140% of the MAI. “French said.
Housing Solutions for Southwest and Southwestern Colorado Council of Governments are teaming up for a regional housing study that will be available in late summer.
Elizabeth Salkind, executive director of Housing Solutions for the Southwest, said the study is expected to provide up-to-date data to help policymakers make sound decisions next year on a range of housing issues, including the shortage. housing for the workforce.
“It’s not like a brilliant achievement that we have a housing shortage, but the study will dig into the details a bit,” said Salkind.
Additionally, the study will provide recent housing market data that will be invaluable in leveraging federal and state funds to address housing issues.
“Being able to access current documented information will be a good thing because the federal government has prioritized housing finance, generally, so now is the time for the study. “
Rick Lorenz, a Realtor for Team Lorenz and The Wells Group, noted that only seven homes are on the market priced between $ 300,000 and $ 399,000, compared to 42 homes under contract.
For homes between $ 400,000 and $ 499,000, 10 homes are on the market and 43 are under contract.
“The numbers don’t really change as you move up the price bracket,” Lorenz said. “This means we have less than half a month of supply available on the market. These figures are astounding. I haven’t seen anything like it, and I’ve been doing this for 44 years.
According to a securities firm, Lorenz said that 45% of home sales in La Plata County this year have been cash sales, meaning that buyers who needed mortgages are frequently outbid by buyers who are well. well-off.
“You’re competing with people who can offer the money, you know – photos of deceased presidents on green paper,” Lorenz said. “If you are a seller you don’t need to have the house appraised, what offer will you accept? This makes it difficult for the normal buyer.
Lisa Bloomquist Palmer, executive director of HomesFund Serving Southwest Colorado, can offer up to $ 75,000 to a household earning 80% of the county’s median median income.
But Bloomquist Palmer said financial aid doesn’t matter much if people can’t find housing.
“We are right in this conundrum because there is simply no housing supply. And it’s getting really, really scary, ”she said. “In a nutshell, there is no supply, and the people in our workforce who can qualify for a first mortgage, who have the money for a down payment – good borrowers who want to stay in our community and raise their children – are unable to find accommodation here.
Baxter said the area suffers not only from a housing shortage, but also a lack of time to deal with the problem before it fundamentally changes the dynamics of the community.
“If we don’t have housing available for firefighters, police, teachers and nurses, we are not going to be the community we want to be,” she said. “We have to act now. We can’t wait six months, we can’t wait a year or two. We really have to start solving this problem now.”