Housing crisis buffets RVing public

The ongoing and deepening U.S. housing crisis continues to ripple through the RV and camping industry, as more people are squeezed out of conventional housing and traditional notions of what it means to have “conventional housing” get upended.

With housing prices at historic highs, asking rents are likewise soaring–23% higher in the second quarter compared to the same period in 2019, according to an Axios report last week, a gain of more than 8% a year. That’s a nationwide average, by the way, including small towns and rural areas; major metropolitan areas are a different story altogether. The average monthly rent in Manhattan, for example, just crossed the $5,000 level for the first time, but asking rents (the rent for new leases, not lease renewals) in lesser cities are growing by double-digit percentages. The year-on-year increase in December, for example, was 23% in Austin, 26% in Phoenix and 29% in West Palm Beach, Florida.

But rental properties aren’t getting more expensive simply because real estate overall is getting pricier: in many places the supply is shrinking as well, especially in the kinds of places that attract tourists and people with money and a hankering for a second home. Investment-property owners who once might have signed year-long leases now find it’s more lucrative to cater to the vacation crowd, converting to Airbnb listings. Owners of second homes, on the other hand, either leave the properties vacant for much of the year or also resort to short-term rentals, resulting in Airbnb listings outside of major metro areas soaring nearly 50% between the second quarters of 2019 and 2022. Either way, the inventory of conventional, affordable rental housing has been diminishing at a steady clip.

What’s a person to do? The default, for those who suddenly can’t afford to rent a house or an apartment, is to move into an RV, a van or even a tent. Some end up in campgrounds, some on public lands, some on city streets. That migration creates a host of social problems, from health and safety issues having to do with inadequate sanitation and increased fire hazards, to societal instability and environmental degradation. But it also amounts to an invasion of a public sphere that most people still regard as essentially recreational rather than residential. Increasingly, RVers report they can’t find a camping site, or the sites that they can find have been trashed or are in close proximity to “campers” who make them uncomfortable.

Some communities are attempting to deal with the problem at its root by limiting short-term rentals. Stinson Beach, a California ocean-side community just north of San Francisco, recently banned new Airbnbs, following the example of San Diego–which has approved a cap that is expected to cut vacation rentals in half–and San Bernardino County, which has temporarily stopped issuing permits for new Airbnbs and other vacation rentals. In Colorado, meanwhile, the Steamboat Springs city council has not only banned new short-term rentals but is seeking to impose a 9% tax on existing rentals with which to fund affordable housing.

Such efforts, however, inevitably generate opposition from property owners and civil libertarians, like the lawsuit filed against Lincoln County, Oregon, after voters last fall readily approved a ban on new short-term rentals. Earlier this month the Oregon Land Use Board of AppealsĀ overturned the measure, ruling the decision goes against state laws, but ban supporters have vowed to continue the fight to “reclaim” their neighborhoods. Similar confrontations are bubbling up elsewhere.

As RVs increasingly become homes of last resort, legislative attempts to recognize and regulate this expanding use frequently run into opposition from trade groups eager to maintain the legal distinction between vehicles and homes. The RV Industry Association, for example, reported last week on its success earlier this year in modifying proposed legislation in New Hampshire that sought to define a “tiny house.” As initially written, the measure would have required a “tiny house on wheels” to “have a seal from a third-party inspection company authorized to provide such certification for tiny homes or recreational vehicles,” which RVIA contended would have resulted in RV standards being “confused with building codes meant for structures used as housing intended for year-round occupancy.”

Thanks to the trade group’s intervention, the reference to RVs was removed–although that did nothing to change the fact that RVs and park models are being used for year-round occupancy. The bill itself, meanwhile, died in committee.

Similarly, a bill in Colorado that RVIA dogged earlier this year would have established a definition of “RV residence,” a mash-up that made the trade group bristle. In addition to applying to any type of RV or park model used as “permanent or semi-permanent living quarters,” the legislation would have created regulations for properly registering an “RV residence” and hooking up an “RV residence” to utilities. The bill overall was meant to regulate tiny homes and was signed into law in May–but only after the “RV residence” references were all stripped out.

While it is indeed incorrect to refer to tiny homes and RVs in the same breath, as the two are built to entirely different standards and codes, the practical effect of actions like those just mentioned is to leave full-time RV residency in a legal and regulatory limbo. While RVIA and others insist that RVs are not intended for year-round occupancy, the reality is that’s how they’re being used, and increasingly so, for the reasons outlined above. Moreover, that’s also how they’re increasingly viewed by the public–which is why they were so readily lumped in with tiny homes by two widely separate state legislatures.

By maintaining the fiction that RVs are just hard-sided tents on wheels, we’re simply tolerating the development of a new generation of slum dwellings.

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How do tiny homes make any sense?

Let me state at the outset that I love the idea of tiny homes. In a society still besotted with outsized everything, there is something satisfyingly modest and efficient about these little houses on wheels. They’re cute. They’re snuggly. The pictures of new ones marketed by the Tumbleweed Tiny House Co. look remarkably well finished and appointed, with clean lines and good lighting. They’re adorable–and way too expensive and in oh-so-many ways completely impractical.

What got me going on this line of thought was the email I received a couple of days ago from Tumbleweed, promoting its sale of a 2020 Elm model that apparently (“bank-owned,” the pitch asserts) was repossessed, which is never a good sign. This 26-foot version can be had for $15,000 off its list price, which translates to $770 a month after an $11,000 down-payment–or $983 a month if you can’t come up with a down-payment of more than $1,000. This latter option, it should be pointed out, may be why this particular little house is back on the market.

Before you start day-dreaming about having your every own home for as little as $770 a month, consider some other numbers. The first is that the loan you’d be buying is for 25 years at 7.75% interest. That interest rate is at least 250 basis points higher than a regular mortgage because tiny homes have questionable appreciation value: they’re more like cars, in that respect, than actual real estate. Moreover, it’s questionable whether a tiny home will even last 25 years, which means that when the loan is all paid off you may be left with nothing more than an immoveable shack.

Here are some more numbers: the 26-foot Elm has 204 square feet on the main level, plus an additional 73 square feet in the sleeping loft–which, as the name denotes, is not tall enough for a short person to stand upright. With an after-discount price tag of $99,879, that works out to $489.60 per square foot if you disregard the loft, $360.57 per square foot if you throw in the munchkin footage. Either way, that’s easily twice the cost of building a, you know, real house.

But, you may reply, a tiny home is so much more than a house–it’s portable, a modern version of a nomad’s tent or a gypsy (sorry, Roma) caravan. Which is true enough, provided that you also have a 1-ton truck to pull the thing, since it weighs 12,200 pounds. Add the cost of such a tow vehicle and now you’re looking at a total price tag that would cover virtually any Class C on the market and quite a few Class As–and those come with holding tanks, which tiny homes don’t have, further limiting their functional portability.

The other thing that most Class As and Class Cs have that you won’t find in tiny homes is slideouts, not to mention a helluva lot more storage space. In fact, for all their good looks and typically fawning press, tiny homes are, well, tiny. At eight feet from port to starboard they’re only two feet wider than a standard prison cell, and without the ability to push those walls out you may feel just as confined. Do a virtual tour of one of these units and think about where you could put tools, books, sports equipment or crafts supplies, and you’ll quickly realize that anything that can’t be digitized wouldn’t remain a significant part of your life.

For all that, look for more of these Lilliputian dwellings to pop up at more and more RV parks and trailer courts. Tumbleweed, for one, is also promoting “tiny house hotels” to campground owners, offering bulk discounts of up to $6,000 per unit when ordering five or more. Could be fun to visit, if not so much to live in long-term.

Just lookin’ for a home . . .

While most people, I suspect, still view RVs as–well, as recreational vehicles–the truth is that a growing proportion of all that rolling stock is being used for permanent housing. Sometimes that’s because RVs are mobile and their owners are seeking a gypsy lifestyle. More and more often, however, it’s because they’re relatively cheap and therefore available as default housing for people one step from homelessness.

One set of clues about this development comes from U.S. census data, another from manufacturing statistics from both the RV and manufactured housing industry associations. What the latter show is that for decades after World War II, low-cost housing in the form of mobile homes was cranked out by the tens of thousands, eventually peaking at nearly 580,000 built in 1973 alone. The average cost for a new house trailer that year was under $9,000–compared with an average $32,500 for a site-built home. No wonder, then, that by 2001 slightly more than 7 million house trailers dotted the American landscape, with roughly one-third of them concentrated in mobile home parks.

But by then, the leading role of house trailers as the cheapest form of housing was already being eclipsed by the RV sector: in 2,000, for the first time in U.S. history, RV production exceeded that of mobile homes, 300,100 to 250,400. And while RVs come in various shapes and sizes and even today are bought more often for recreational purposes than for residential ones, the production gap grew wider every year thereafter. By 2020, only 94,400 house trailers rolled off the production line, compared to 430,400 RVs. This year, more than 600,000 RVs will be produced, and even more are projected for 2022.

With RVs priced, on average, slightly more than half of what it costs to buy an average mobile home–$42,617 vs. $78,500 in 2020–and only a fraction of the median U.S. home price of $374,000, it’s easy to see why people with little money might start looking to RVs as housing alternatives. Indeed, the U.S. Census Bureau, observing a slow but steady decline in mobile homes in its biennial housing surveys, in 2015 made up much of the difference by adding a new housing category labeled simply “other,” defined as “boat, RV, van, etc.” “Other” clocked in at 69,000 in 2015, 75,000 in 2017 and 96,000 in 2019. The 2021 numbers should be out soon, and undoubtedly will notch another increase.

None of this is definitive–yet–but does strongly suggest that more people are turning to RVs for affordable housing. That, in turn, means more demand for RV spaces in campgrounds, as well as on the streets for people who can’t afford campground fees.

There’s one more data point that’s relevant: the growing number of “tiny homes,” which unlike RVs are intended as full-time residences but which usually don’t meet zoning and other requirements for conventional year-round housing. Half beast, half fowl, they often cruise the countryside on their wheeled chassis in a frustrating search for a roosting place. This week the Tumbleweed Tiny House Co. came to their rescue, issuing a nationwide list of “over 250 places to park your tiny house”–the great majority of them, it turns out, being RV campgrounds.

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