Census shows more than 40% of Ouray homes vacant
OURAY, Colo. — Thirty percent of Ouray County’s housing stock is considered vacant, according to new data from the U.S. Census Bureau, with more than 1,000 housing units reported as unoccupied, despite a housing shortage that has left local workers with few options and led to employee shortages at local businesses.
The “vacant” designation describes homes where no one was living when the Census was taken, which includes second homes where occupants have another primary residence. It does not include homes that were only temporarily vacant, such as if an owner was on vacation, but it does include units that are being used as vacation rentals.
The latest data from the 2020 U.S. Census shows 3,314 total housing units in the county, 1,017 of which are vacant.
The concentration of vacant units is highest in Ouray, which has a vacancy rate of 43.4%.
Ridgway has the smallest share of the vacant homes, with just 89 of the town’s more than 600 units considered vacant, while another 601 are in unincorporated parts of the county.
That includes 107 recorded in Loghill Village, a 5.6-square-mile “Census Designated Place” on the southern end of the mesa, which includes both the Loghill Village and Fairway Pines subdivisions. The vacancies make up more than a quarter of homes in that area.
At just under 31% countywide, the local vacancy rate isn’t quite as high as other small mountain counties: Hinsdale County reported a 71.8% vacancy rate, followed by Mineral County, with 65.1%. San Juan County and San Miguel County are both also in the top 10, while Ouray County ranks 17th of the state’s 64 counties.
But it’s a rate that has raised eyebrows in recent discussions about short-term rentals and second homes, both of which have seen even more interest during the pandemic. The vacancies tallied by the census were as of April 2020, and could be even higher with more buyers purchasing second homes here since then.
More than 200 units are currently licensed by the town, city or county as short-term rentals, and local Realtors have said the opportunity to rent out homes for fewer than 30 days is seen as an asset for buyers, particularly those not looking to move here full-time yet.
Buyers are drawn by the flexibility of being able to block off a week here or there to visit themselves, instead of having a long-term tenant renting the unit, and by the increased revenue that comes with vacation rentals.
Nationally, short-term rentals can generate three to five times as much money as an annual lease, according to Karen Xie, a professor at the University of Denver who studies the industry.
“It’s a very powerful cash flow machine for a lot of people,” she said. When Airbnb was founded in 2008, it was referred to as the “sharing economy” or “home sharing,” and emphasized that it was cheaper to rent a spare room or a basement in a house than a hotel room, Xie said. But starting around 2015, the industry professionalized and took off, with management companies and investment buyers getting in the game and seeing bigger profit margins. “It’s now completely flipped, and it’s treated as a very good cash flow asset,” she said.
Especially in mountain areas, close to national parks or ski resorts, the potential to use a home as a short-term rental has caused prices to double or triple, Xie said.
In Colorado ski towns especially, “you can see a lot of local people’s houses have been flipped into an Airbnb,” Xie said. When residents, especially young people, leave to find more affordable housing elsewhere, “that definitely has an effect on local economies.”
It also makes small towns with tourism-dependent economies even more vulnerable, she said.
Even for buyers who aren’t looking to rent, but instead want to leave their homes vacant when they aren’t present, the pandemic has presented more opportunities with remote work. Low interest rates have made now an attractive time to buy.
But the Census data shows the vacant homes aren’t a new phenomenon here, even if they’ve been thrust into the spotlight more recently. In 2000, Ouray had 209 vacant homes; by 2010, that number was 343. It fell by 16 units in the decade since; the number of occupied units also fell since 2010 by 51.
“It’s sort of more of the same, given the fact that it’s always been a good share of the housing stock vacant in my time here,” David Vince said. He came to Ouray in 1980 and spent 25 years working for the city, including as its administrator and community development director.
“It was just a fact of life in Ouray,” he said of the empty homes. “I don’t think that’s necessarily good, given the housing shortage we’re experiencing for workers and people that the community needs here, for firemen, for teachers, the folks that really make the city run, but it’s sort of just the way it’s been.” That was a topic of conversation when he left city administration in 2005, and one that’s only been exacerbated in the 16 years since.
Don Batchelder, who was an elected official in the county for nearly 40 years before leaving office in January, said the vacancy rate isn’t surprising or concerning to him yet.
In some ways, second home ownership is beneficial, he said. When owners are in town, they often spend money in local businesses and contribute to the tax base, but they have less impact on services than full-time residents.
“If it were in the 50% range or something like that, I think it might be an issue,” he said. “But 30% county-wide I don’t think is too bad.”
If the number of vacation homes and rentals increases too much, “it sort of skews the community a little bit,” he said. “If half the houses were second homes and vacant, it’d be real different than it is currently, where generally, you know most of the people who live in a two or three block area, you say hi, you might have the neighbor’s chickens in your yard.”
Former Ouray mayor Bob Risch, who grew up in the city, moved away and returned more than two decades ago, said the issue was discussed during his tenure, “but not to the extent that it is now.”
The Ouray he came home to, and led as mayor from 2006 to 2012, looked very different from the one he left as a 17-year-old, when most families were connected to the mining industry.
As more people discover Ouray, “it was probably an inevitable trend,” he said. “And the wealthier people can, of course, afford a second home here and spend their winters elsewhere.”
While some part-time residents are active volunteers and participants in the city, a base of full-time residents is crucial, he said. “I think if you live here all year, you are more involved in the community,” he said.
The county’s population grew by almost 10 percent in the last decade, adding more than 400 new residents since the 2010 census.
But the new arrivals didn’t spread evenly throughout the area: the population within the city of Ouray fell by about 10 percent, from 1,000 to just under 900 in that time. Ridgway’s population growth more than made up for the loss, jumping by 28% in that time to almost 1,200 residents. The majority of the county’s population increase came outside the municipalities.
Ouray’s dip in residents raises concerns about the sustainability of year-round businesses and institutions, Risch said.
“We need a certain base of that, to maintain schools, to maintain shops that we want to count on,” Risch said. “It’s a growing concern but hopefully we won’t see further drops in the population.”
The population also became older over the last decade: in 2010, children under 18 made up about 18% of the county. That number has fallen by about 100 since then, and they now account for 14% of the county’s residents.
At 4,874 residents, Ouray County fell just behind projections from the State Demography Office, which anticipated just over 4,900 residents by 2019. But they expect gradual growth will continue, passing 5,000 residents within the next five years.
At some point, the growth starts to change the social fabric of a place, Batchelder said.
“You have a situation where as people move in, there isn’t the opportunity to get to know the people that live there to the same degree,” he said. “You don’t assimilate the mores and the values that have been in the area for a while, and the association is more with people that haven’t been in the area for a while.”
“I see that happening in Ridgway, and to a degree in the county,” he said, though the amount of open space and room for growth in the county makes it less noticeable there.
“It’s almost like any area that has not grown a whole lot, that is really vibrant, has this soul to it and the soul starts changing a bit,” Batchelder said.
He said the same is true in Ouray, despite it shrinking instead of growing, because of the changes in the community’s composition.
There may have been even greater growth in the county over the last year than the numbers indicate, which are not yet reflected in the 2020 Census data, with more full-time and part-time residents attracted to the area during the pandemic.