Short-term rentals have taken a firm hold in many Vermont towns, according to new data from a research company that studies online lodging services including Airbnb, HomeAway and VRBO.
The Spanish company AirDNA reports that the resort town of Killington has nearly as many vacation rentals as it does permanent residents. The town, home to Vermont’s largest ski area, has 800 people, according to the 2010 Census, and 740 vacation rentals, most of them entire homes, according to AirDNA.
Stowe — with a population of 4,400 — has the most short-term rentals of any municipality in the state, with 898 properties listed.
That means people in the business of finding housing are getting creative.
Before online short-term rental services became popular, many of the homes, apartments and spare rooms in Vermont were available to rent year-round. But increasingly, the owners of those properties are finding that it’s more profitable to list them on sites like Airbnb, HomeAway and VRBO.
In a place like the Mad River Valley, that’s making it more difficult for people to find a place to live when they want to work at Sugarbush, which staffs up to 1,000 in the winter. With 500 listings for short-term rentals in Waitsfield and Warren alone, Sugarbush Resort CEO Win Smith has been getting creative about finding worker housing over the last few years.
Sugarbush gives away a much-reduced $100 season pass to anyone who opens up a room or garage apartment to a renter for the winter season. It is leasing spots with at least 110 beds in the valley, and last fall purchased an inn that sleeps 30. Sugarbush also owns space with an additional 25 beds and is in the design phases for building a dorm with up to 90 rooms, possibly as soon as next summer.
“It is the given reality, and we are learning more about the impact,” Smith said of short-term rentals.
“It’s certainly a positive that there were more rooms available for people to rent, so that allows more skier visits, so that’s a plus,” he added. “The negative is there’s a shortage of seasonal rentals compared to prior years.”
Airbnb and other short-term rentals are shaping the Vermont economy in many subtle ways. They’re providing a needed income for Vermont property owners who might be rich in real estate but cash-poor, supplying a rare source of new income in many rural areas.
Vermont Airbnb hosts earned more than $20 million providing lodging this summer, the San Francisco-based company reported this month. It said about 140,000 Airbnb guests checked into Vermont Airbnbs from Memorial Day Weekend through Labor Day. The summer’s $20.4 million in earnings was just shy of the year’s ski season earnings, which Airbnb reported as $22.3 million.
Airbnb is one of several online rental companies operating in Vermont, and it has become a large player in the state’s $2.8 billion tourism industry. Research shows it’s still growing; the company said some Vermont towns reported their biggest weekend for Airbnb ever during the past ski season. AirDNA said the number of listings for homes on several short-term rental sites increased 44% between 2017 and 2019, and the number of listings for private rooms increased 30%.
The short-term rental market is of interest to advocates for affordable and mid-range housing because the online rentals remove homes from circulation that used to be rented year-round. The state is seeing a housing shortage in many areas already, and advocates for affordable housing say the short-term rental websites have made things worse.
“We know how important the state’s tourism economy is, but when homes that would otherwise be brought to the market and be available to rent year-round or be purchased don’t come onto the market – and instead are offered as short-term rentals – that reduces the available housing stock,” said Maura Collins, executive director of the Vermont Housing Finance Agency. “And that drives up prices.”
The issue came up at the housing summit this month in Burlington, where the city reported that the number of short-term rentals rose 25% in the last year. Burlington, like other municipalities in Vermont, is looking at increasing the regulation on these rentals.
Waitsfield and Warren, destination towns for visitors to Sugarbush, have 164 and 320 short-term rentals, respectively, about 85% of them entire homes; Woodstock has 106, about 75% of them entire homes, according to AirDNA. The number of homes vs. rooms in homes is critical to housing advocates, who say those homes could have served families year-round if they weren’t being rented to vacationers.
Woodstock has regulated short-term rentals in its village, but not in the rest of the town.
“The evidence clearly suggests that the impact of short-term rentals is to take units out of both the primary rental and ownership markets,” said a report on housing in Woodstock by Doug Kennedy Advisors of Norwich.
Burlington, the state’s largest city, has 340 rentals available on short-term rental sites, two thirds of them entire homes.
Airbnb said this year that most of its summer activity was in Chittenden County, with more than $5 million in revenue. Lamoille County was next with $3 million, and Rutland and Washington counties came after that with $2 million. Airbnb said the five top destinations for Airbnb guests to Vermont this summer were Burlington, Rutland, Stowe, Montpelier and Lyndon.
Smith said he thinks at least some of the short-term rentals aren’t properties that would have been rented permanently otherwise.
“Some are doing for a shorter period – say a Holiday week – and are helping to pay their property taxes,” he said.
While it doesn’t make financial sense for most private developers to build affordable housing for workers in resort towns in Vermont or elsewhere, Smith said Sugarbush is in a slightly better position than many.
“We have existing land, water, and septic, so it might be a little easier for us,” said Smith. “We’re looking at $150 to $200 a square foot, so it’s a question of how much do you need.”
