— from Norm Zimlich —
Orcas multiple listings today show four homes under $300,000: two Eastsound condos and two livable houses. Could a salaried worker on Orcas buy one of these? Let’s work the numbers.
First huge hurdle: banks require a down payment of at least 20% – e.g., $60,000.
Next, banks will usually approve a home loan only if the mortgage, insurance, and tax payments will not exceed about one-third of the buyer’s gross income. Zillow Mortgage Calculator says that monthly mortgage payments on a $240,000 loan at today’s 5% x 30 year rate, plus average taxes and insurance, would be about $1,550 per month. Thus, gross income of the person or the couple buying would have to be at least $4,650 per month to qualify. A person or a couple working 40 hours a week year-round would need steady combined income of about $27 per hour to get this loan. Really!
Facing these formidable challenges, a salaried worker might try to RENT a place to live on Orcas. While looking up the multiple listings, I also looked up the Vacation Rentals by Owner (VRBO) listings for Orcas Island. There were 447 VRBOs advertised in October, ranging on average from $200 – $300 rent PER DAY! I have to ask: if you owned an unoccupied Orcas house, why in the world would you rent or lease it year-round, even at $1,600/month, when you can VRBO it for three months of the year and make the same amount, with one quarter as much wear on the house? There go 447 possible rentals for Orcas year-round salaried workers.
Folks, let’s get REAL. If we need a workforce of year-round salaried workers on Orcas – which we most certainly do – then we also need year-round homes which those workers can buy or rent. Join me in voting YES for the Affordable Homes initiative.
**If you are reading theOrcasonian for free, thank your fellow islanders. If you would like to support theOrcasonian CLICK HERE to set your modestly-priced, voluntary subscription. Otherwise, no worries; we’re happy to share with you.**
Thanks for your contribution, Norm. The numbers you have provided make it clear how badly we need the Affordable Homes initiative. Vote YES on Proposition One.
There is an idea to limit the percentage of vacation rentals in geographically-delineated areas of our islands. If the limit were reached, no new vacation rentals could be permitted unless an existing one came out of service. The opening would be filled via lottery.
There are sevveral issues I wish we would hurry up and address, and codify into law, concerning how we will inform the building of more desperately-needed affordable homes and housing projects; and development in general.
1) only build in non -wetland areas and put in a clause that puts a moratorium on any more madrona forest clearing in and around UGAs and on shorelines – For ALL future developments. Leave wetland forests intact and reinstate Army Corps “big dumb buffers.” In a wind tunnel like Eastsound, this is particularly important. Protect our endangered madronas.
2) Moratorium on all new vacation rental builds for at least two years, to be reassessed after we have firm carrying capacity numbers and reliable, realistic buildout numbers that consider impacts to the environment. No new vacation rental or “luxury condo” builds in the UGAs – period! UGAs are supposed to be for year-round residents to be “clustered.” You can’t have it both ways and keep building VRBOs in UGAs.. It’s why the GMA specifies that people LIVE in UGAs.
3) Increase the time requirements to be considered a “long term resident” – presently it’s 31+ days!