As more and more people have moved to Durango since 2000, housing demand and prices have continued to rise.
But while rents and the price of homes have gotten more expensive, annual wages have not kept pace.
Durango is not alone. In Bayfield and Ignacio, salaries have not kept pace with rising home prices.
“More and more people are priced out of the regular market because wages aren’t keeping up,” said Elizabeth Salkind, the executive director of Housing Solutions for the Southwest.
The Community Development Department of the city of Durango presented an extensive analysis of housing and income statistics from various sources during a council meeting last week.
The planners reported that finding a place to rent in Durango is much harder compared to the rest of the state. In recent history, there have been far fewer rental vacancies in Durango compared to the state average.
In addition, rents in Durango are comparable to those in Summit County, home to Breckenridge, while the average income of Durango residents is far lower than in the northern Colorado county. This imbalance can be a deterrent to long-term residency, and that tends to impact the stability of the community over time, said Phillip Supino, one of several city planners.
The same trend is true for the local housing market.
The median income in Durango, of about $53,000 is approximately $30,000 less than required to buy a median price home, which is about $358,000. The area’s population steadily has been growing by about 2 to 4 percent annually since 2000, placing even more pressure on the housing market.
That growth rate is projected to continue. By 2023, the city’s population is expected to be more than 19,000, according to the city analysis.
“If we have increased population, but not increased housing, the strain is going to be even greater,” Salkind said.
The city planners project that 900 more housing units are needed over the next eight years to keep pace with growth.
Durango City Council directed the city planners to analyze the housing market further during 2015 to come up with strategies to help encourage more housing development. The strategies may include changes to the new land-use development code and financing incentives for developers, Supino said. The city officials plan to work with the Regional Housing Alliance of La Plata County to analyze housing and development policy changes.
The city is interested in encouraging more development in hopes that it will allow more people who work in Durango to live in the city and buy homes here. This helps create a sustainable community and encourage wealth accumulation, Durango City Councilor Christina Rinderle said.
The city planners will look at what type of housing is in highest demand and what areas of town might be prime for development.
Three Springs, where houses are priced around $275,000 to $300,000, is suited to meet part of the demand, said Max Hutcheson, a real estate agent at the Wells Group.
There have been 175 units built in Three Springs so far, but 2,200 homes total could be constructed in the subdivision.
Housing Solutions of the Southwest and RHA are also chipping away at the problem by working to build more subsidized housing, Salkind said.
But there are many other factors that complicate the issue, including geography, Fort Lewis College and the state’s condominium defects laws, among others.
Fort Lewis only houses about a third of its students on campus, one of the lowest percentages in the state, according to the city analysis. That puts a greater demand on the city’s rental market, lowering the number of available rentals and raising rents.
Condo development also has ground to a halt because of a state law that has opened up builders to more lawsuits. Under the current law, only two unit owners need to agree to sue a builder over construction defects. The state legislature may change the law in the new year, but lawmakers failed to take action last year.
The city planners hope to make policy suggestions to encourage housing in 2016 based on their research.
“Everything we do is going to be rooted pretty heavily in data,” Supino said.