Planners take long game when addressing housing shortages
By Carolyn Shapiro
A lab analyst for Bionique Testing Laboratories in Saranac Lake recently quit after a year on the job. A primary reason: He couldn’t find a decent place to live.
Bionique, which specializes in mycoplasma analysis for the pharmaceutical industry’s development of new drugs, has expanded its workforce from 30 people three years ago to an expected 50 by the end of this year, said Gladis Zamparo, the company’s CEO. But it’s hampered by an impenetrable housing market across the region. Rentals and homes are scarce and prices—reflecting that limited supply–are staggering.
For the senior management candidates Bionique wants to hire, it struggles to offer a competitive relocation package that includes a housing option, Zamparo said. On the other end of the experience spectrum, recent college graduates that Bionique brings on will exit their campus housing with nowhere else to go. Employees often end up commuting an hour or more to work.
“We’re looking to grow,” Zamparo said, “but one of the biggest challenges that our new employees highlight is really the difficulty of finding long-term housing.”
Across the Adirondack Park, the needs of workers and their families have motivated regional community organizations to move housing to the top of their priority lists. They are scrambling to address at least some of the multifaceted challenges causing the most severe nationwide housing crunch in history.
In the park, it stems from a combination of factors: a stagnant supply of new houses and apartments; an aging residential stock with many properties uninhabitable or too dilapidated to sell; increased demand from people wanting to move to the area from more expensive cities; and the influx of investors turning apartments and houses into more lucrative short-term rentals, driving up market prices.
None of the solutions on drawing boards will emerge overnight—or even in the next year. Each fills a piece of the complicated housing puzzle. All, though, have the goal of reshaping the residential housing landscape in a way that helps their communities prosper.
Land bank
ADKAction has been gathering community leaders to talk about creating an Adirondack land bank. Land banks are nonprofit organizations created by, and sometimes operated by, local governments and given the authority to acquire foreclosed, tax-delinquent properties that often are dilapidated and vacant.
The land bank buys the property cheap, renovates it and sells it—returning it to the tax rolls. It usually costs between $50,000 and $100,000, said ADKAction board member Buck Bobbin.
The result is “the same kind of property that it was but much nicer and much higher value. It conforms with the neighborhood that was always there,” Bobbin said. “It is added to the high-quality housing stock.”
Since 2011, the state Legislature has authorized 35 slots for land banks, and more than two dozen have been created. To create one, an entity with foreclosure authority needs to apply to the state’s Empire State Development Corp. for consideration.
Buyers are desperate for affordable houses, and a land bank would provide some. Bobbin envisions each municipality paying into the land bank initially. Once properties are renovated and sold, the land bank uses the profit and the additional tax revenue as a self-sustaining fund, he said.
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Pictured here: Community leaders hope Fawn Valley, a housing development in Lake Placid, will take some of the crunch out of the local market. Photo by Mike Lynch
The Mohawk Valley Land Bank—covering multiple counties and a few cities—could serve as a model, Bobbin said. “They’ve had remarkable success in creating durable housing units for working folks,” he said.
ADKAction seeks to build consensus among communities with different needs and goals to create one or more land banks, Bobbin said.
“It’s kind of trying to shift the broader conversation for how we look at our own region and how we look at our individual communities and how we plan together,” Bobbin said, “even if we live an hour away.”
Cooperative housing
A year ago, Ward Lumber transferred its hardware and lumber stores to its workers, creating one of the largest employee-owned cooperatives in northern New York. The company worked with the Adirondack North Country Association and its Center for Businesses in Transition.
That triggered the idea to build cooperative structures to tackle the housing crisis. ANCA, an economic development organization that covers the 14 most northern counties, has seen businesses from small family restaurants to technology startups struggle with staffing because of the lack of housing, said Elizabeth Cooper, executive director.
Meanwhile, ANCA explored repurposing a 100-acre parcel in North Elba donated to the organization. ANCA wants to use a small part of that land for cooperative housing—a development that the people who live there will own. The residents would take a stake in the entity formed to own the complex and rent back their unit from that nonprofit entity.
“If it’s single-family homes, or if it’s apartments or condominiums—that vision is set by the group of folks who will then be the collective owners of the cooperative housing project,” said Patrick Murphy, who left his executive director seat at the Saranac Lake Chamber of Commerce last year and in February became ANCA’s new cooperative housing engagement specialist.
ANCA will identify the target demographic of potential residents, emphasizing low- to moderate-income working professionals, Murphy said. Stakeholders will form a steering group to decide details such as whether they want hiking trails through the surrounding woods, on-site childcare or farmers markets.
Deed restriction
Webb looks little like Vail, Colo. but the town has a similar problem: a large portion of its housing stock converting to short-term rental property. Now, Daniel Kiefer-Bach hopes Vail’s experience gives Webb a similar solution.
LivingADK, where Kiefer-Bach works as community development specialist, has adapted the Vail InDEED program to keep single-family homes occupied by the people who own them. This deed-restriction program gives homeowners an incentive to encumber their property with a requirement that any future purchaser must live in the house.
In a housing survey last year, Webb found that nine of 10 homes that were sold in the town went to buyers who did not plan to live in them full time. Some intended to use them as secondary vacation homes. Most though, became short-term rentals, the type listed on websites and apps such as Airbnb.
The problem isn’t just that those would-be family dwellings dropped out of the pool of potential homes for locals and workers. It’s also that the properties morphed into income generators, driving up their value. That, in turn, pushed up the cost of housing. Deed restrictions dilute the investment-driven inflation to make restricted homes more affordable.
Because those houses will sell for less, the deed-restriction program gives owners money to offset the difference. In return for that compensation, the seller will stipulate in the deed that whoever buys the house must reside in it. In general, Kiefer-Bach said, the value will decrease by about 15 percent.
“Your economies are only as good as the core of your community,” Kiefer-Bach said. A healthy community needs residents to shop in its stores, work in its health care centers, teach in its schools and volunteer for the fire department.
LivingADK is promoting the program and is targeting potential sellers, such as older residents looking to downsize or recent home buyers who want the incentive money. A donor provided $35,000 as seed money for some of the initial incentives and a couple of grants to cover startup costs.
“I would love to have a program like this all over the park,” Kiefer-Bach said, “because it really is a solution that is win-win-win.”
This is a very forward-thinking piece. Stopping rural population decline by keeping rural populations in place, although it seems obvious, runs a bit contrary to the prevailing mantra in the United States. For example, many analysts are quick to blame the national housing crisis — and, to some extent, rural outmigration — on things like lack of turnover (migration) and decreased mobility. But when has it ever been the case that mobility and turnover has ameliorated net outmigration from rural regions? If we truly want to stem rural outmigration (though the jury is out on whether this is in our economic best interest, even for rural economies), then interventions like deed restrictions and credit programs (e.g., land banks) are how we do that. Interventions to induce migration, like subsidising job markets and recruitment, have not borne themselves out.