Housing squeeze makes RVs a default

The development struggle that’s been going on in Maggie Valley, North Carolina, for much of the past year is symptomatic of a growing problem around the country, as developers rush in to capitalize on the renewed interest in RVs and RV campgrounds. As with any boom investment, the financial shock waves thrown off by big money frequently buffet little people who have no skin in the game and are simply trying to get by–and when it’s their housing that’s at stake, the end result is immiseration.

In Maggie Valley, the conflict began when a Myrtle Beach-based developer unveiled a $200 million (!) plan to revive a defunct theme park, which many locals remember fondly from the latter half of the last century. But bringing Ghost Town in the Sky back to life requires a lot more juice than it once did, the developer explained; it requires a whole lot of ancillary development, from new restaurants to a hotel to a health clinic. It also will require finding at least 200 new workers in an area that doesn’t currently have them, and new housing for all those workers, because the area doesn’t have enough of that, either. That’s why reviving the theme park also means building additional RV campgrounds, he told the town, because that’s the cheapest and most flexible housing solution–even though the town has precious little flat land and at least a dozen existing campgrounds already serving the tourist trade.

The campground “solution” raises several issues, not least among them the suitability of RVs for long-term housing. But here’s an even more fundamental question: why isn’t there enough housing in Maggie Valley for the people who work there? And the answer, as just about all resort towns already know, is that real estate prices have gone through the roof. In Maggie Valley, located in Haywood County, home prices have jumped 33.7% in just the past year and 73.3% over the past five years, to an average of $338,316. Meanwhile, the average monthly income in Haywood County was just $2,454 in 2020, putting affordable housing out of reach of the people working in the tourist industry that is supposed to inject the town with economic vitality.

Ironically, while some of that upward pressure on prices is due to inadequate new construction, a significant part of it is the result of the pandemic-fueled return to the outdoors that developers are now trying to exploit. As local observers have noted, new visitors arrive, they fall in love with the mountain scenery and they decide to stay–sort of–by buying a vacation home. Sometimes two. That’s nice for them, providing a refuge from whatever claustrophobic cities they call home, but while their surplus homes sit empty most of the time, local workers more rooted to the area can’t find an affordable place to live.

This is not a problem peculiar to Maggie Valley, of course, although it may be more pronounced in mountain communities because of their additional topographic constraints on new home construction. Local news reported last summer that many workers in Jackson Hole, Wyoming, were living out of their cars in Bridger-Teton National Forest because there was no housing to be had. In the Idaho panhandle this past week, the Shoshone Board of County Commissioners heard numerous objections to a proposed RV park, including the fear that it would essentially become a magnet for “trailer trash.” As one local resident pointed out, a plummeting availability of rental properties is forcing area workers to turn to short-term rentals and RVs for their housing needs, with RV campgrounds at risk of becoming the next generation of trailer courts.

Indeed, short-term rentals are the other main driver of housing scarcity: real estate investors have concluded that the higher rates they can charge for short stays more than compensate for their higher risk compared to long-term rentals, and so have been snapping up houses and apartments that would otherwise be rented by working people. The short-term rental sector is so lucrative that newcomers like reAlpha–trolling for new investors with as little as $1,000 to buy in–dangle an irresistible set of numbers: Zillow’s estimate that long-term rentals are currently pulling in an average of $1,495 a month, vs. Airbnb estimates of $3,256 a month for short-term stays. “There’s a reason billionaires invest 20-40% of their wealth in real estate,” reAlpha croons.

Given those pressures, it’s little wonder that many RV campgrounds increasingly are headed in the direction of being dumping grounds for people with nowhere else to go. RVs are hardly designed for year-round living, and unlike regular housing they depreciate over time, so their owners never build up the equity that would allow them to escape their trap. But they are a step above living out of a car in a national forest–and they do enable developers with deep pockets and large ambitions to keep on getting bigger.

Author: Andy Zipser

A former newspaper reporter who worked at a variety of newspapers, from small community weeklies to The Wall Street Journal, I finished my "normal" work life as the editor of The Guild Reporter, official publication of the union representing newspaper workers. On retiring, I and my wife bought a campground in the Shenandoah Valley and--with the help of our two daughters and their husbands--operated it for eight years, first as a KOA franchisee and then as an independent family-owned RV park. We sold the campground in May, 2021, and live in Staunton, Virginia, a short walk from our grandsons' home.

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