The state of housing on the Outer Banks: Part Three

Published 5:14 pm Monday, July 31, 2023

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Brian Sanders works on the ferry in Hatteras. He was drawn to the Outer Banks from Raleigh because of the surfing, but he likes living on the coast and he enjoys the small community. “I’m starting to make friends here. This job is a good opportunity,” he said.

He’s been seeking long-term housing since May. He’s applied for a couple of places and been put on a waitlist, and also responded to ads on Facebook, but without success.

He works seven days on, seven days off, and though he said his job offers him housing while he’s working, on the other days, he said he’s camped outside or visited friends out of town.

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“Seems like it’s really strange out here. The ferry is constantly understaffed. Everything’s understaffed. There’s not enough housing to house the people that are needed to make these islands run economically. I don’t know what the future holds here,” he said.

“I’m a stable worker, I show up every day,” Sanders said. “I thought maybe someone might read the article and say, ‘I might have a place where he can stay.’”

Sanders’s story is not unique. He’s just one of countless others who have been affected by the housing shortage on the Outer Banks.

In the final installment of our series exploring the state of housing, we will look at the effect on individuals and businesses, as well as offer some possible solutions to the problem. (Read Part One here and Part Two here.)

John Harris, founder and president of Kitty Hawk Kites, has taken an innovative approach to the housing crisis. Realizing years ago that a lack of housing made it difficult to recruit employees, Harris began slowly investing in real estate to house J-1 international students and additional summer help.

Today, he has 15 units from Ocracoke in Corolla that are all full, but he said it still isn’t sufficient.

“We’ve been at it for a long time, evaluating each year what we needed and gradually adding housing. Now we get to where we are in 2023 and we still don’t have enough. With all that housing, we still can’t support all the employees and managers we need to run our business,” Harris said.

He said Kitty Hawk Kites is still lacking between 20 and 25 employees for the Outer Banks locations. “And of course, every business is facing it,” he added.

“We hear it every day in our store from people that are visiting. They are having to wait an hour, an hour and a half to get into a restaurant. You go by on a Tuesday, most of them are closed. If you go at dinnertime, it’s a long wait to get in,” Harris said.

One popular medium-large Outer Banks restaurant that offers online reservations had a two week wait to get a table for two at 6 p.m. Walk-ins are invited, but guests will likely wait 90 minutes or more for a table, and up to a three hour wait for larger parties.

“If somebody told me 20 years ago that restaurants would be open only five days a week in the summer, I would say, ‘In what world are you talking about?’ This is the world and that’s only going to get dramatically worse,” said Kill Devil Hills Mayor Ben Sproul, who got his start in the Outer Banks in the restaurant industry in 1987 as a waiter, went on to co-found The Pit Surf Shop and Boardriders’ Grill, and later served as president of the Outer Banks Restaurant Association for 10 years.

This certainly isn’t the fault of restaurant owners. Restaurant work is long and tiring, and our local establishments simply can’t hire enough people to meet the demand. Or, the restaurant is small, and the squeeze from other places that are closed one or two days a week adds pressure, equaling long wait times and unhappy guests.

And of course the issue is not just about restaurant wait times – that’s just a symptom. It’s also about access to medical care and availability to other service providers like electricians or plumbers or pool cleaners. It’s about enough housekeepers to thoroughly clean the thousands of rentals every week. It’s about rising prices across all industries, and service-oriented businesses that remain understaffed.

“That’s not the way it should be serving our guests. Because we want them to go back and tell all their friends the Outer Banks is the most fabulous place they’ve ever been with the beaches, recreation, best service level they’ve ever received,” Harris said.

“The big challenge for us is the service level.” If nothing changes, Harris said, his business “cannot provide the service that we want to provide to our customers if we don’t have the staffing to do it.”

“We are so blessed to have tourism as our industry here, the major industry because it allows all of us a really good quality of life for a low cost,” Harris noted.

Over a quarter million people visit the Outer Banks each week in peak season, from Corolla to Ocracoke. Some recent estimates put that number up at 300,000 people weekly. These tourists spend upwards of $1.8 billion annually and provide over 12,000 jobs throughout Outer Banks-area counties.

These tourism dollars help keep property taxes low. Dare County has the fifth lowest tax rate in the state.

It’s estimated that tourism reduces the tax burden for every resident by $3,930 according to 2022 statistics.

However, local municipalities do add additional taxes for services and some add beach nourishment district taxes. Nags Head raised taxes this year to pay for the almost $20 million public services complex and water metering system.

This infrastructure is critical to care for not only Dare County residents, but for the millions of visitors that come through each year, and everyone agrees it’s a priority.

But what if we included workforce housing as part of the infrastructure of our community?

“As a community we need to plan for workforce housing. We need to plan for the infrastructure for it like we plan for water, sewage, electricity – all the infrastructure it takes to grow our community and our tourism economy, which has been a tremendous blessing to the community. It takes planning for the infrastructure to plan for our workforce,” Harris said.

Some people simply have no appetite for growth or providing for growth. They see not only the tourists but the seasonal workers and the recently relocated as an intrusion in the way of life they used to enjoy.

These people will deal with the wait for a restaurant or an electrician or a doctor if it means no more people. They will resist development and elect people who feel the same way.

“The people who would love to roll back to 1972 when all the cottages were small – I understand. They’re nostalgic. I’m nostalgic, too. All you can do is have a conversation about it and go, ‘I agree.’ I empathize with the people who liked it the way it was,” Mayor Sproul said.

Though empathetic, Sproul has worked hard in Kill Devil Hills to increase affordable housing.

Sproul recognizes that the trend toward coastal living is only getting stronger, and if the Outer Banks community doesn’t take an active role in finding solutions to the housing problem, our area will go the way of Jersey Shore or Ocean City, Maryland, where the smallest, cheapest homes often go for $1.5 million.

Even if you already have a home here, rising costs are still a factor. Long-term residents, especially the elderly on fixed incomes, can struggle to keep their homes because they can’t afford the taxes or the cost of living in the area they grew up in.

“We have just as much demand and we’re actually a nicer environment,” he said of the Outer Banks.

What does the housing shortage mean for commerce in the Outer Banks?

It will be increasingly difficult for entrepreneurs and new business start-ups. The “entrance fee” to own a business in the Outer Banks will be so high that only the very wealthy will have access.

“It’s stifling our creativity and our ability to grow in the future because a guy like me that came in with credit card and $5,000 – that’s what I started my business with – can’t enter because you basically have to own [employee] housing as well as your business to get started,” said Sproul.

Ferry worker Sanders said he’s “trying to start a landscaping service to work in my off time. I’d like it to promote edible and pollinator installations on the island. It’s been challenging to start the business without having a permanent place to stay.”

The North Carolina Aquarium on Roanoke Island has experienced staffing shortages because of the housing issue. Because of the specialized scientific nature of aquarium positions, many staff members are recruited from outside the area.

Though the aquarium has sublet some housing space to support seasonal staff, the lack of available housing in the Outer Banks has resulted in staff shortages. Currently there are eight or nine full-time vacancies and several seasonal vacancies.

“Due to staffing shortages, we have had to reduce the number of summer camp offerings and other paid and public programs,” said aquarium director Larry Warner.

There are hundreds of other stories that could be told from mom-and-pop shops to major retail chains.

So where do we go from here? Is there a way forward?

To quote The Cat in the Hat by Dr. Suess, “This mess is so big and so deep and so tall. We cannot pick it up. There is no way at all.”

But then, of course, the Cat returns with “another good game that I know” and a multi-armed machine that tidies and sweeps and cleans in a matter of minutes.

While there may not be a single answer that will solve the housing crisis, there may be a “multi-armed” approach that can begin to make a difference.

Nags Head business owner and community leader Joseph “Jody” Crosswhite has served on various town committees over the years, and believes that a critical part of the solution involves the collaboration of the county and the six municipalities.

“Start something. Start a process. Work towards putting together a housing authority,” he said.

Crosswhite believes that there are properties that could be suitable for affordable housing, but may involve thinking outside the box.

The Outer Banks is not the only tourist community to have grappled with these issues. There are other towns and regions that have found solutions to similar challenges.

Vail, Colorado, which is similar to the Outer Banks in that it is a booming tourist community that has struggled to keep their workforce in affordable housing, has been nationally recognized for their innovative solutions.

The Vail InDEED program looks at the housing problem from a fresh perspective – the idea is that the town acquires perpetual deed restrictions from private property owners. The goal is to acquire 1,000 new deed-restrictions on homes in Vail by the year 2027, and they’re currently on track to meet that goal.

The deed restricts the occupancy of homes to people who live and work in the county, and in return homeowners get paid a sizeable amount (on average $91,000 per unit) to place a restriction on their home.

On the Outer Banks, perhaps Dare County could offer something smaller in scale, or offer financial or tax incentives for people who convert their weekly rentals back to long term housing.

Members of churches or community groups could work together with a goal of renting out rooms in their homes for the purpose of offering housing to seasonal or workforce employees.

Commissioners’ boards can work to increase density in their respective towns through zoning changes.

Beyond empty lots, the county could look at purchasing, then remodeling or repurposing homes or business complexes for long-term housing. The key here is density – to solve the housing crisis, there needs to be more density in the habitable living areas of the Outer Banks. As we talked about in Part Two of our series, 85% of the land in the Outer Banks is government owned for the purposes of parks, recreation, wildlife refuges and preservation, so the land that is remaining must be considered carefully to meet the needs of the community.

The Outer Banks has deep history of perseverance and problem solving. From the first colony of settlers to the Wright Brothers to the boatbuilders in Wanchese, it’s in the DNA of this community to solve problems, and I stand in agreement with aquarium director Werner’s statement: “I believe many people are working tirelessly in our community to try and address the housing issues … I believe that acceptance of the need by everyone in Dare County is critical to successfully fixing our current housing issue. Together, we can solve this.”