Vacation rentals a huge part of Stowe housing stock

Those talks continued at the selectboard’s Sept. 13 meeting, where Julie Marks, founder and director of the Vermont short-term Rental Alliance, provided a state-level perspective.

According to Marks, the alliance supports “fair and reasonable” regulation, and thinks towns have a role to play in educating homeowners on how best to rent out their places in ways that don’t create problems for everyone. She surmises that the “nuisance” properties are likely those owned by people who are new to the game.

“The common community concerns around short-term rentals tend to be nuisances like guests being too noisy, parking in the wrong places, mishandling the trash. Trust me, these are nuisances for owners and managers too, because they often coincide with damage to the property,” Marks said. “We find that these issues are pretty easily addressed once owners are educated on how to prevent them.”

Marks said a registry in Stowe would allow the town to collect more data and better understand the market and provide that education to renters as well as provide a complaint hotline for the community. She also said it shouldn’t be rushed.

“In order to collect comprehensive baseline data for future policy analysis, we recommend not imposing any measures or conditions that would at this time restrict rentals or significantly alter the market,” Marks said. “It may take a couple of years to collect that baseline data before any trends and impacts are revealed and would inform any future policy action.”

By the numbers

Renting in Stowe is big money, and a hefty chunk of the town’s annual local option tax revenue comes from short-term rentals. According to Marks, in 2021, there was roughly $81.2 million in gross revenue, and Stowe captured $568,000 of that through its 1 percent local tax — after the state tax department took its share of the local tax.

Last year, that number grew to $105.5 million in gross revenue, and the town pocketed $738,700. For much of the past decade, the town has been able to rely on roughly $1 million a year from its local option tax, so that 2022 figure represents a significant portion of the overall local tax revenue.

Marks said that has ripple effects on the local economy, too. According to the rental alliance’s data, one short-term rental unit supports four “fractional” local jobs in the hospitality, food service, retail and entertainment industries. And, she estimated, one four-night stay at a short-term rental brings in roughly $1,500 in visitor spending at local businesses.

Marks said trends across the country and in Stowe show renters tend to be younger, with 80 percent of Gen Z travelers having stayed in a vacation rental. She said the fastest growth and highest concentration are in and around ski resort communities.

Based on a 2021 survey by the Vermont Short Term Rental Alliance of 229 people, other statistics include:

• 60 percent of them are owned or managed by women.

• 55 percent of them are owned by people over 55.

• Half of them are full-time Vermont residents who pay state income tax.

• 82 percent of owners operate fewer than three vacation rental units.

• 90 percent of owners occupy them for personal use each year.

• 22 percent of owners also offer long-term annual rentals.

“I don’t think it’s a huge surprise that Vermont’s most famous tourist destination, Stowe, has the highest abundance of vacation rentals in the state, and has for decades,” Marks said.

State or local decision?

Two years ago, Gov. Phil Scott vetoed a housing bill that would have set up a statewide rental registry, telling lawmakers that, although there is a housing shortage, “the solution is not more regulation.”

But many Stowe residents and selectboard members, even those who own vacation rental property, think a registry would be a good idea, and so does Marks.

“As an association advocating for consistency, we would prefer a statewide registration process and some baseline, standards and regulations so that there isn’t this patchwork approach from community to community, and all the spillover effects that that has, regionally, from town to town,” Marks said. “But, obviously, that’s not the way that our state seems to be headed.”

When it comes to the actual patches in that patchwork approach, Stowe remains singular.

According to the Vermont Short Term Rental Alliance, as of earlier this year, 17 percent of Vermont’s housing stock was comprised of second homes. But Adams said the most recent data from the Stowe town appraiser’s office indicates that 75-80 percent of Stowe’s housing stock is second homes.

“We’re completely different than any other town in this state,” Adams said. “Completely different.”

Adams, who has expressed wariness at governmental overreach when it comes to rental ordinances or registries, noted that the town planning commission in 2018 “made the decision to embrace short-term rentals.”

And board chair Lisa Hagerty acknowledged there is no turning back now.

Hagerty expressed alarm, however, that the small number of Stowe homes “that are truly our community” is disproportionally affected when even a few single-family residences are lost to second-home owners or investment buyers who will never live or work in Stowe.

“To have a thriving community with children that go to school, with multi-generations and multi-socioeconomics — to the extent possible in a town like this — we need to do something, anything that we can to understand the dynamics of housing,” Hagerty said.

Rep. Jed Lipsky, an independent representing most of Stowe and someone who has a short-term rental, said Vermont and the rest of the country is experiencing a housing crisis, but cautioned folks from “scapegoating” short-term renters from taking much-needed housing stock off the market.

Many people at the Sept. 13 meeting said they use revenue from renting part of their property to vacationers or other short-term visitors, a popular refrain among retirees with fixed incomes. Many of those same people also support a registry.

Mary Skelton Altadonna rents out her Pleasant Street home — she moved in with her husband Lynn when they got married on New Year’s Eve 2021 — and she has used the revenue to pay for a new furnace and roof on the place. She said she is “100 percent” in favor of a registry.

“My philosophy on short term rentals is that if you’re offering a bed to someone in your house, and you're not charging them, that’s a hobby,” she said. “If you’re offering a bed or your house to someone and charging them, that’s a business and it needs to be treated like a business.”