Home alone: to rent or not to rent in CB

The pay scale here has rarely been comparable to the cost of living but the trade-off is the privilege of living in a safe and supportive community nestled into some of the most astounding topography, with nearly unlimited outdoor opportunities, and apparently the low wages and high cost of living doesn’t factor enough to make most who choose the lifestyle move. Buttians have also been noted for their innovative ability to turn a buck to make ends meet and recently some are taking advantage of a newer trend in the short-term vacation rental market and earning the extra money to help with the rising costs of existing in the north end of the valley. Since the launch of international rental booking websites like Airbnb.com and Vacation Rentals By Owner (VRBO.com), people worldwide are turning their spare and guest rooms into cash. Crested Butte property owners have jumped on that bandwagon. VRBO’s listings consist mostly of entire houses, cottages, condos and apartments, while Airbnb.com is more eclectic, offering everything from backyard hammocks, gypsy wagons and boats to houses and rooms. Crested Butte’s housing stock seems to fit somewhere between luxuriously elegant and uniquely funky. Audrey Anderson and Eric Davis use VRBO to rent their small downtown home of one bedroom and a loft known as the Historic Air Condition House, on First Street off Elk Avenue. “This is our third summer and bookings this summer are pretty busy,” Audrey says. “Bookings started June 20 and we’ve had several three-nighters and one for six nights. We haven’t been back in the house for a month.” Audrey explains that they’re camping while the house is rented. The back-to-back bookings taper off in late August as the stream of tourists and families head home and back to school. But September sees an influx of older visitors who come to escape the hectic pace and crowds of summer. They come to hike, bike and watch the aspen turn gloriously gold. Audrey says they used to rent in winter but discontinued because, “I love it here in the winter. I don’t want to go anyplace else. I love to ski.” She also notes that their summer bookings continue to grow every year. “I think the town’s crazy, it’s so crowded. I feel that part of the appeal of our house is that its décor and ambiance is typical Crested Butte funkiness,” she says, and points out that people want to feel what Buttian life is all about even though they have no dream of living it in their reality. They come here and get a taste of our wild side, a different experience from any other mountain town resort. Audrey says, “It reflects a lifestyle that 90 percent of the visitors who come here don’t get to live,” and they’ll take that experience home with them. Most of the Andersons’ guests want help and direction about where to go to get the most of the Crested Butte experience— restaurants, hiking, biking, drives and events. “We’ve been here for a long time and we know where to go. That’s part of the offerings when they book. And I leave a lot of food in the house for them to use,” Audrey says. Sandy Fails, owner of the Old Town Inn located at the bottom of the hill as you arrive in town, has not felt an impact from all the new pop-up rentals. “In the summer, the Old Town Inn, and most in-town lodging, is in such high demand that the Airbnb/VRBO phenomenon is no problem at all,” Fails says. “We can actually use the extra in-town lodging. When the Old Town Inn is full, our front desk people call around to find walk-in guests a place to stay. During the peak times this summer when all local lodging has been full, we’ve suggested some Airbnb options to stranded guests looking for a place to stay, but most people don’t really want to go that direction. They want to stay in a place with high service, breakfast, a hot tub, privacy, and someone available to help them make decisions about where to hike, bike, eat, raft, listen to music, etc.,” Fails says. “In the summer especially, we get really involved in people’s vacation experiences, if they want us to, but then they have a completely private room and bathroom. Obviously, Airbnb options can range from a room in someone’s house to a whole house. So you might sacrifice a bit of privacy or you might be there on your own without someone to introduce you to Crested Butte and advise and help you. For others, of course, an Airbnb situation might be great,” Fails notes. Fails’ son, Chris Garren, is the general manager of the Old Town Inn and has been interested in the dramatic impact both Airbnb and VRBO have had on the lodging industry in general. In a lodging and hospitality-oriented publication, he read that some of the big accommodation businesses on a national level are lobbying heavily for restriction for online rental sites and similar owner-rental avenues because they are cutting into hotel bookings. “A lot of people are against the rentals because they don’t feel they’re paying the taxes. The impact is substantial, enough that the corporations are up in arms,” Garren says. In New York City, tenants are illegally renting their rooms or apartments out to Airbnb and VRBO guests without landlord or owner permission. There’s a lawsuit pending because the large hotels aren’t pleased with the substantial cuts these renegades have made into their profits. People are just trying to make ends meet in an exorbitantly priced rental market there, which is similar to the situation in Crested Butte. Tina Curvin, with the town of Crested Butte, is on the lookout for unregistered lodgings. Anyone who operates a short-term rental in town must apply for a business license and pay sales tax. “A lot of Colorado towns are upset by [the unregistered lodgings] because it’s hurting them since people are doing it under the table and it’s difficult to find these people. When I started in 2007 we didn’t have very many vacation rentals in our system. It’s a small town so it’s not as hard for me as it is for other towns to find those doing it illegally,” Curvin says of ferreting out the non-complying. Currently there are 21 Airbnb listings within town limits and more than 100 listed on VRBO. Curvin notes that some people willingly come in on their own and some don’t. The town charges 4 percent regular sales tax, collects 2.9 percent for the state, and 1 percent for county, and RTA gets .06 percent, which adds up to 8.5 percent total. Then there’s an additional 4 percent for a lodging business, or Local Marketing District Tax, according to the Colorado Department of Revenue, but it comes back to us in some form, Curvin says. A business license for lodging is $10 per pillow, which is better than most Crested Butte town businesses, which must shell out $100 for the year. Both Airbnb and VRBO charge for their services, of course. Airbnb charges hosts 3 percent of the total rental (guests pay 6 percent to 12 percent fees). VRBO has host options of either a flat rate subscription that ranges from $350 to $1,000 a year, or a pay-per-booking rate of 10 percent of the total. Within the past two years, Airbnb has asked for tax identification or social security numbers in order to comply with the IRS requirements of sending hosts 1099 forms. Those who failed to divulge their sensitive information were charged an additional 28 percent withholding tax. Between self-employment tax or fees, town taxes, and the booking fees, hosts are paying anywhere from 43.5 percent to 50.5 percent of their rental income—and that’s without the town business license and pillow tax. There is another aspect to the short-term rental boom that has affected the local long-term housing market, which has been growing more scarce. Chris Garren is one of many who are concerned, saying, “Without a doubt, it’s taking away from local housing. I’ve never seen so many houses in town with rental plaques. It seems like so many homes are short-term rentals now and people aren’t being able to renew their leases because owners are turning the houses into the more profitable short-term rentals. I think its partly because there are new companies like VRBO and Airbnb that are making it easier.” At the same time Garren also feels that there aren’t enough beds in town for visitors. “We don’t mind having Airbnb because our inn is largely full, but unfortunately it’s people looking to rent a place long-term who feel the negative effect of this trend.” Garren recently spoke to a former resident who was offered a great job here but couldn’t find housing because long-term rentals weren’t available. “So that’s one downside, and it’s probably more pronounced in the summer when lodging is at a premium for both guests and residents,” says Garren. There are absentee second-home owners who leave their houses empty for all but six to ten weeks of the year. The same thing is taking place with the new explosion of locals who are turning their extra bedrooms and houses into short-term accommodations so there is less long-term housing available for locals. Crested Butte could certainly use much more affordable housing and the impact of Airbnb and VRBO has noticeably harmed the availability of long-term housing in here, according to many. Some homeowners are trying to make big return on their properties by switching from long-term rental to short-term rental, but others who are leasing out a room, a condo, or their entire home are merely trying to make the mortgage payment or their property taxes as the cost of living here rises annually. Perhaps when the new affordable housing is completed, the issue of lack of long-term rentals for locals will be somewhat of a moot point. For now, homeowners are doing what they can to get by with the opportunities provided to them.