Utah saw a dramatic increase in short-term rentals, or STRs, from 2021 to 2023 and is expected to continue in 2024, according to a press release published by the Kem C. Gardner Policy Institute on Wednesday.
“The average number of monthly STR listings increased by 39.4% from 16,803 in 2021 to 23,428 in 2023. At the state level, STR listings account for approximately 1.9% of all residential units. While this figure is relatively low, it continues to rise.”
Tourism: A key driver in STRs
The impact short-term rentals — think Airbnb, Vrbo — have on the housing market varies among counties in the state, with more substantial effects happening to places higher in tourism. These effects make affordability and availability difficult for long-term residents.
For Utah, “Approximately 24.9% of all short-term rentals are in a quarter mile from a ski area,” Moira Dillow, a housing, real estate and construction analyst for Kem C. Gardner Policy Institute, said Wednesday morning at a media roundtable discussion. As you go further geographically, “we see from like five to 10 miles, and then 50 plus (from ski areas), we have a high surge of short-term rentals.”
Summit, Salt Lake, Washington, Utah and Wasatch counties saw the largest growth in short-term rentals from 2022-2023. With high tourism attractions such as Park City Mountain and Deer Valley Ski Resort, Summit County saw a 13.6% change with 774 new STR listings in that time period, the report said.
“For every 10 new residential units that are put onto the market, approximately 12 short-term rental units” were added from 2022 to 2023 in Summit County, Dillow said. “So that means there’s a decrease in housing stock.” In 2023, it increased from 12 to 14, making the statistic that for every 10 residential units, 14 short-term rentals were listed.
It’s not all bad news, though. Short-term rentals do have some more overall benefits. Dillow noted that short-term rentals can help boost the local economy and increase tax revenues. They can also improve neighborhoods when property owners invest time and money into maintaining and upgrading these rentals, which helps revitalize the area.
STR’s effect on housing affordability
Summit County is a current example in which the drawbacks outweigh the benefits of short-term rentals in terms of affordability and availability, as it’s continuing to lose existing stock to short-term rentals, Dejan Eskic, a senior research fellow at the Kem C. Gardner Policy Institute, said during the roundtable discussion.
He emphasized that short-term rentals disproportionately affect higher-income neighborhoods in addition to tourist destinations, reducing the availability of affordable housing for the local workforce, particularly those in the service industry.
When it comes to finding a balance between short-term rentals effect on affordable housing, “I think we’re making, albeit incremental, progress in some of these areas” since many of these tourism-heavy areas are in remote parts of the state, Eskic said during Wednesday’s discussion.
“In Grand County, a big challenge to building more affordable housing is its geographic location. It’s really hard to get labor into rural Utah. Even if you clear the regulatory barriers and construction costs,” he added, “it’s still getting labor out to those communities that is the major challenge.”
But like most issues, short-term rentals are only a small fraction of a nationwide housing crisis.
“There’s so many obstacles for housing affordability. Short-term rental is just one smaller piece of that,” Eskic said. “Even if we banned all short-term rentals today, we (would) still have a housing shortage. And then when we look at where these short-term rentals are, they’re not necessarily in the highest growing areas of our state, just tourism-heavy areas.”