Impact of vacation rentals on housing stock pales in comparison to that of second homes
Nearly three-quarters of all the properties in Cook County are second homes that are not used as vacation rentals and, in fact, sit unoccupied for most of the year.
According to information shared with WTIP from the county assessor’s office, Cook County has 10,487 total housing units. The total number of vacation rentals is approximately 420, which equates to just over 4 percent of the overall housing units. Meanwhile, the total number of second homes and seasonal cabins in Cook County is 7,616, which equates to nearly 73 percent of the housing stock.
Local officials say this is a critical aspect that needs to be considered when it comes to fully understanding the local housing crunch.
“Cook County has always kind of been that second home cabin property destination,” Cook County Assessor Bob Thompson said during a Sept. 2 interview on WTIP. “So when you look at the bigger picture, certainly that has an impact on the housing and the available stock.”
Thompson said when reviewing the local housing stock, the prices of homes in Cook County “are on par with the median home prices” of the Twin Cities region.
“And that’s kind of unique throughout the state,” Thompson said. “There’s not a lot of these smaller rural counties that have such a high median home price.”
The median value of a home in Cook County is just over $310,000, according to a nationwide database. This value only includes the middle price tier of homes, the report says, noting that Grand Marais home values have gone up 8.7 percent over the past year.
Some community members have been quick to lay the blame of rising property values and the local housing crunch overall at the feet of the vacation-rental industry in Cook County. However, the total number of vacation rentals operating in Cook County at this time is a small percentage of the housing stock overall, particularly when compared to the number of second homes and seasonal cabins in the community, Thompson said.
In other news about vacation rentals, there are approximately 70 unlicensed vacation rentals operating in Cook County at this time. An unlicensed vacation rental property means that someone is not following a county ordinance that has now been in place for several years, including a permit that costs $200 annually. According to the county, “the requirements to obtain a vacation rental license from Cook County are fairly minimal and includes the basic property and contact information for the owner and property manager, and also includes a self‐certification of liability insurance for the property, and the rental must be in compliance with the Minnesota Department of Health License requirements.”
In addition to operating in violation of a county ordinance, it’s possible that unlicensed vacation rentals are also not paying lodging taxes, according to county officials. Vacation rentals operated or managed by local companies in the vacation rental industry are offering unlicensed properties to rent at this time, according to Thompson.
To hear the full interview with WTIP’s Joe Friedrichs and the county assessor, listen to the audio below.