Sitka is considering action to limit the growth of short-term rentals in the community, based on both a sudden uptick in the number of permit applications this year, and the widespread feeling in town that housing is extraordinarily tight.
But now, it’s more than a feeling. The Alaska Department of Labor’s latest monthly report shows Sitka near the top of the list of communities whose housing stock is tied up in short-term rentals. The available long-term housing also costs Sitkans more than Alaskans who live elsewhere; another indicator suggests there are more vacancies than expected.
2022 is not the first year that Sitkans have complained about a housing shortage, but it does seem more acute lately. In just the last few days, on a social media page called “Sitka Housing Leads” there are five new postings in search of places to live, by a tidy non-smoker, by someone hoping for 2-3 bedrooms not more than $1,600 a month, and by someone desperately in search of a place for themselves and “a medium lab dog mix” through November, who is “open to anything.”
There are also some housing units listed, including a 3 bedroom, 2 bathroom apartment for $1,500 which is sure to be snapped up, a nicely-remodeled 4 bedroom house – but sorry, no ocean view – for $625,000. And there’s a recent listing for a studio apartment for $2,000 – but it has no bathroom. The picture shows a birdhouse – a humorous commentary on a situation that’s not especially funny, if you’re one of those who just can’t seem to find a place.
“And this has just been so stressful,” Ben Kinzer told the Sitka Assembly in March. “There were many times where we were worried and preparing to be possibly homeless in a few months or living out of our car, which I didn’t expect.”
Ben Kinzer testified before the Sitka Assembly when a proposal to freeze short-term rental permits came up. Kinzer and his partner – both fully employed in good jobs – had moved six times in 18 months.
The assembly ultimately declined to impose a freeze on short-term rentals, and instead is moving toward issuing permits only to residents for rentals at their primary residence – the original idea behind a bed and breakfast. The ordinance appears likely to pass, but members noted the absence of hard data to back up the experiences of those like Kinzer who’ve felt the pinch.
That data may have arrived. The September report of the Alaska Department of Labor – called Trends – has extensive research on rentals in the state, and it puts the situation in Sitka in perspective. For example, in the second quarter of this year, April-June, Sitka had 151 vacation rental listings, out of a total housing stock of just over 4,000 (4,229) units. That’s three-and-a-half percent of Sitka’s available housing in short-term rentals. In Juneau, there’s considerably more housing stock – almost 14,000 units (13,792) – but only 379 short-term listings in the same period. That’s about a full percentage point below Sitka.
Kodiak falls into the same range as Juneau – two-and-a-half percent of housing is short-term – and Ketchikan is even lower, at 1.9 percent. In fact, the only place to top Sitka is the Kenai Peninsula, with a whopping 6.8 percent of available housing listed as short-term rentals.
Where Sitka and Kenai diverge, though, is in the cost of long-term housing. Kenai ranks lowest in the state, with residents spending 22-percent of their wages to pay an average rent of just over $1,000. Sitkans on the other hand, are at the top of the list, paying 31-percent of their wages to pay an average rent that is $350 more than Kenai.
The last piece of the housing puzzle in Sitka doesn’t quite fit as easily into the scarcity picture: While a lot of Sitka’s available housing is tied up in short-term rentals, the vacancy rate for long-term housing is the highest in the state – 7.6 percent. Gunnar Schulz, the research economist in Juneau who authored the report in Trends wrote “Rising costs and waning pandemic supports have increased the burden on tenants. The prices of big-budget items such as food and gas have risen substantially over the last year. Meanwhile, eviction moratoriums, stimulus payments, expanded unemployment benefits, and emergency rental assistance have all expired, adding unusual twists to affordability calculations.”
All of this suggests that housing is dynamic, and what was accurate in the second quarter of this year might not be accurate in the third. Who knows? With a little paint and the right furniture, that birdhouse might be a steal.
