Another take on unaffordability
Dear Editor:I have much respect for Tim Semrau’s hard work for this community. In Wednesday’s Times, he addressed three big local issues. I’d like to offer alternative perspectives on two.Referring to local growth-control policies, Tim states: “the side effect of limiting supply is astronomical home prices far beyond the reach of working Aspenites.” Though his is not an unreasonable or uncommon conclusion, other supply/demand factors are at work in our local economy that may point to a different cause for unaffordable local housing.Case in point is Eagle County, whose economy is arguably more similar to Pitkin County’s than any other. Though quite different in important ways, the two counties are driven by comparable economic forces. In particular, demand for land and houses in both places is relatively insensitive to price. That is, buyers in both places can pay extremely big bucks. Also, housing for working people is roughly equally unaffordable in the two counties.One significant difference though is that Eagle’s growth controls have been minimal, while Pitkin’s controls have been strict for 30 years. So, one must ask: If housing is unaffordable in both places, while one county has strict controls and the other has minimal growth restrictions, attributing unaffordability to supply restrictions seems a very long stretch. It’s simply illogical. The more likely cause of unaffordability is the nature of the demand, which is similar in both places. Demand is insensitive to price. When many people are willing to pay “astronomical” amounts, who in their right mind would build affordable housing, however unlimited the supply may be?Framed another way: If Pitkin removed all growth controls tomorrow, who would build affordable housing?A related anecdote: From 1990 to 2000, the number of houses on the island of Hawaii increased faster (25 percent) than the number of people (23 percent). But, despite supply increasing faster than demand, the state of Hawaii has the least affordable housing nationwide.Since it’s very unlikely that the Pitkin and Aspen electorate would allow growth controls to be removed, this may seem to be an academic argument. But for our dear neighbors in Eagle County, where new thinking may bring valuable growth controls, this is an important conversation.Tim also speaks to “local establishments being eliminated by absentee owners seeking bigger profits,” and suggests (to oversimplify his point) that we can prevent this phenomenon by buying from locally owned businesses. While his suggestion is correct, it may be incomplete.One reason that locals get out of business is that commercial rents have become unaffordable, similar to housing. However, though our community has acted aggressively to secure affordable housing, we’ve done nearly nothing to ensure long-term affordability of commercial space, which has created a glass ceiling, blocking working people from becoming business owners. What if, 30 years ago, we had created a land trust to buy commercial buildings and rent space only to qualifying locals at break-even rates? What if we did it now?Michael KinsleyOld Snowmass
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