Truckee-Tahoe business owners tackle housing shortage by becoming landlords
July 22, 2017
Every spring, Tahoe City Kayak owner Andrew Laughlin posts a list of job openings to round up a team of employees for the summer. He gets resumes from highly qualified candidates, with all the right certifications and experience guiding in places like Denali or Colorado.
But each year, the same scenario plays out again and again.
"About 24 hours before the interview I get a call or an email, always with the same message: 'I've been looking for housing for over a month and I can't find anything. I'm going somewhere else,'" he said.
Communities across California are struggling because they don't have enough affordable housing for their workforce, but in the resort communities of Lake Tahoe and Truckee, local business owners are increasingly taking matters into their own hands.
"Every business owner I know is in a crunch to find more humans," Laughlin said. "Airbnb may have doubled the number of people coming to Lake Tahoe, but it has simultaneously taken away the amount of people there are to serve them."
Fed up with the shortage of housing available to his employees, Laughlin recently purchased an eight-unit apartment building in Kings Beach.
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"We've been seeing our business steadily go up, and the number of people being able to serve our customers go down due to what I believe is an Airbnb-caused housing crisis," he said.
As tourism to the North Lake Tahoe region has grown steadily over the last several years, returning to pre-recession levels, small business owners like Laughlin have been grateful to see the local economy improve, but also frustrated that the rising cost of housing has made it difficult to retain employees.
During the same last few years, short-term rental sites like Airbnb, Homeaway and VRBO have grown significantly in popularity.
"It's simple economics. People are making three times the amount of money Airbnbing a property than they are renting to ski bums and mountain folks," Laughlin said. "I understand why people do it, but at the same time, what about our community? How do we make it so that people can live here?"
In the last year, a regional housing study documented the lack of affordable housing options and the growing need for more homes priced below the current market rate. The Tahoe Regional Planning Agency made it possible for homeowners who want to build mother-in-law units to do so, and a council to address the housing shortage also formed. The problem has been acknowledged by government officials and community stakeholders, but people are still living in cars and sharing rooms.
To add to the dilemma, small business owners like Laughlin often can't find time in their hectic work schedules to attend public meetings.
"What's been done so far is just a drop in the bucket based on what's needed," Laughlin said. "I see help wanted signs on nearly half the businesses in Tahoe City."
After regularly working 12-hour days to make up for the shortage of employees, Laughlin decided to take matters into his own hands and find a way to provide housing to his employees.
"It was the only way I saw to be able to not kill myself in the next few years," he said.
There is no shortage of people who want to live and work in North Lake Tahoe — the problem is that many of them can't find a place to live. Craigslist and local Facebook groups are scattered with posts from people saying they just got a new job in the Truckee-Tahoe area, and are looking for housing. Unfortunately, many of those people won't find homes.
"I know tons of school teachers and nurses that can't make it, that are sleeping on couches," Laughlin said. "There are folks that have been in this community for years, who know people and have professional jobs that can't find anything."
Originally, Laughlin set his sights on trying to find a piece of land that he could use as a campground.
"I have more than seven employees that live in vehicles right now, two of which are a couple that live in a car," he said. "I've got employees that are couch surfing, I've got several employees that are moving their vehicles just so they don't get hassled by employees."
"If I had a campground where I could say, '$250 a month and you can have a hot shower,' people would be all over it," he said.
But Laughlin wasn't able to find a piece of land where he could make that project work, so he looked to local real estate listings and found the eight-unit apartment building central to his business locations so his employees could feasibly commute. The deal closed several weeks ago, but he's already hoping he can buy more property to house his employees.
"I need about 30 people to run my various locations, and eight (units) isn't enough," he said. "Hopefully, I'll have a good enough summer to make an additional purchase."
Laughlin said he understands that longer-term solutions are necessary, but he believes that if some of the barriers were lifted and employers were able to provide campsites for employees, that would at least help in the short term for people who are open to the idea. He said he's willing to bet that many of the people who want to live in Tahoe are outdoorsy enough to want to live in a campground.
"Van life is a pretty active hash tag on Instagram from what I understand," he said. "The millennial generation is open to it … making it so that's not an illegal or shady thing to do would definitely help."
Tahoe Dave's owner Dave Wilderotter recently purchased an RV park in Truckee with the hope of providing his employees, who want to rent and live alone, a cheap enough option for them to afford.
The RV park is only the latest addition to a growing number of properties that Wilderotter has bought, or helped his employees buy over the years, to maintain a stable and high-quality team to run his business.
"For guys like Andrew (Laughlin) and me, we don't have a choice, we have to go buy it," he said.
Wilderotter said he never wanted to be a landlord, but over the years he has found it to be the only option for hiring and keeping employees.
"Its tough because I'm not in the business of being a landlord and sometimes I get taken advantage of," he said. "But I keep reminding myself, 'What's the alternative?' The alternative is I don't have any employees."
His business has been around a long time and has grown over the years. Wilderotter said that housing has always been a problem, but it's escalated at a phenomenal rate in more recent years.
"This has come on so fast — the combination of the Airbnbs of the world, coming out of the recession, and how much money there is in the world," he said. "There's no incentive for people to build small homes."
Wilderotter said that some of the efforts being made by local governments, especially the town of Truckee, are a good start. But, he also said that governments are limited because they can't move as quickly as people in the private sector.
"In the private sector, we can move quickly. We can just decide to buy a property, and then buy it," he said.
Wilderotter also recently hired a housing coordinator to help his staff find stable places to live.
"It's frustrating but at the same time, as a business owner, it's just another expense to your business. That's the nature of how it's going now," he said. "You've just got to work it into your numbers."
Wilderotter, who is currently traveling, said that he's heading to Colorado soon to visit several tiny home communities, with the hope of getting some ideas for how to implement similar housing in the Tahoe-Truckee region.
He said that decision-makers must find a way to make building small more affordable, because it isn't currently feasible for developers unless they specialize in it and can get grants to help make up for the cost. He hopes to clear the way for a tiny home village one day soon.
"The thing about mini homes is they're on wheels, and trailer parks have a bad name, but that's going away," he said.
Wilderotter said it's important to be flexible and to adjust the to community's changing needs.
"Airbnb? It's not bad; we've got to accept what's there and decide if you're part of the solution or part of the problem," he said. "We don't want those visitors to go away."