It’s no secret that Vermont has a significant shortage of homes available for sale right now. Aside from homes available to purchase, Vermont has the lowest vacancy rate in the county for rental properties which sits at .5%. So what action is being taken to counter the housing issue that hampers so many buyers in today’s market? It starts with reform to Act 250 which is Vermont’s landmark land-use law. Permitting and zoning are two huge factors that have played a role in creating obstacles for new housing to take place here in the state. As a native Vermonter, I believe in the importance of preserving Vermont’s natual beauty. It’s what makes our state unique to so many others in this country. However, there has to be a balance. As of late February 2023, a housing bill seeking to provide more construction and updates to existing housing by revising state and local building regulations is moving forward.
According to an article posted by VT Digger, the bill would set aside over $90 million in one-time funding, primarily to build and rehab housing. The proposals include
- $20 million to VHFA for a Missing Middle-Income Homeownership Development Program, which would provide subsidies for new construction or rehabilitation of affordable owner-occupied housing for purchase by income-eligible homebuyers.
- $20 million to VHFA for a Middle-Income Rental Housing Revolving Loan Program, which would provide subsidized loans for rental housing that serves middle-income households.
- $20 million to the Vermont Rental Housing Improvement Program, which would fund grants for up to $50,000 per unit to private landlords for the rehabilitation of eligible rental housing units.
- $25 million to the Vermont Housing and Conservation Board to fund affordable mixed-income rental housing and homeownership units, make improvements to manufactured homes and communities, recovery residences, and farmworker housing.
- $2.5 million to help tenants pay for rental arrears and prevent eviction for nonpayment of rent.
This is of utmost importance because the Vermont Housing Finance Agency estimates that the state needs to make 40,000 new housing units available by 2030 if it wants to return to a healthy market. That is a significant number when looking at the historical numbers behind building in Vermont.
So what does this all mean? The simple dynamic of supply & demand will continue to support home appreciation in years to come. As remote work remains an options for workers in today’s world, many are able to work in jobs that they couldn’t find here in Vermont, all while still being able to live here. Coupled with new construction not keeping up with that rate of demand, and you find yourself right where we are today.
Let me know your thoughts and/or questions regarding the state of the Vermont housing market. The link to the article I reference by VT Digger is below.