How college football is clobbering housing markets across the country

RASHE Malcolm loves her son Wayne and his girlfriend, but she’d also love it if they could move out of the three-bedroom home in Athens that she shares with the couple, both 23, as well as her husband and two of her three other children.

But the rent is too high for anyone to go anywhere, at least locally.

“If you go to these newer units, I mean, if you can get one for US$1,800, that’s considered cheap,” said Malcolm, 48. “For a one-bedroom – a one-bedroom. It’s like US$2,100 on average.”

Life in Athens, a city of about 127,000 residents, is centred around its largest employer: the flagship campus of the University of Georgia, which enrols more than 40,000 students and employs about 10,000 people. Like many US cities, it has seen rents rise over the past few years, even as developers have added new units to the market. Much of the construction is luxury off-campus housing for the growing student population.

But Malcolm believes that the rent issue in Athens has more to do with football.

The Georgia Bulldogs – the two-time defending national champions – draw some 90,000 spectators to Sanford Stadium for six or seven home games every fall, essentially creating an alternate market for short-term rentals that lasts about three months. Real estate investors are buying and building homes for fans who will pay hundreds or even thousands of dollars on a weekend of housing for a home game, and the effects are impacting local residents all year long. According to AirDNA, which tracks the performance data of Airbnb and VRBO vacation rentals, there are currently 1,135 short-term rentals available in Athens – up from 865 in November 2022 – with 88 per cent of them comprising an entire private home.

Malcolm, who lives on the west side of Athens, runs a non-profit called Farm to Neighbourhood and a food truck and catering company, Rashe’s Cuisine, on the city’s east side, not far from Sanford Stadium. “It is a historically Black area,” she said, “so when football games happen, you do start to see more non-Black people coming through the neighbourhood and walking over to the liquor store to get beer to go back to their rental.”

Athens is no outlier. Around the United States, in small cities reliant on college sports to keep their economies humming, short-term rentals are destabilising housing markets, fuelled by wealthy fans and investors who transform single-family homes into de facto hotels for a few weeks out of the year, and often leave them sitting empty the rest of the time.

“College athletics, in particular college football, have become so enormous in this country, particularly in the Southeast, that it has caused this phenomenon of short-term rentals,” said Adrien Bouchet, director of the DeVos Sport Business Management Program at the University of Central Florida. “On one hand it creates value, but on the other hand, it definitely hurts people that have lived in and around the university for a long time.”

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Bouchet pointed to similar market trends in Southern college towns such as Auburn, Alabama; Tuscaloosa, Alabama; Gainesville, Florida; and Oxford, Mississippi, where football rules the economy during the fall. Over the past year, the supply of short-term rentals has grown 34 per cent in Tuscaloosa (home to the University of Alabama), 33 per cent in Columbia, Missouri (University of Missouri), and 11 per cent in South Bend, Indiana (University of Notre Dame), according to data from AirDNA. Bookings typically peak in November.

But it’s not just the rental markets that are affected – investors are overpaying for the houses they rent out, pulling sale prices out of reach for many locals.

“They have very wealthy alumni that have no problems buying second houses, whether that’s for their kids to go there or whether that’s just for them to have a good time seven or eight weekends a year,” Bouchet said. “And that’s caused the price of these houses to go through the roof and push people out of these neighborhoods.”

Affordable-housing advocates say that without limits on where and how these rentals may operate, college football towns are helpless to prevent excessive increases in rents and home prices.

In September, Athens-Clarke County imposed a temporary moratorium on future short-term rentals in single-family zoned districts, spurred not just by economics but by the increase in complaints involving noise and traffic congestion. The move was opposed by some local homeowners who rely on short-term rental income and do it responsibly. But critics say that regulations haven’t gone far enough in a county with hundreds of homeless residents and an affordable-housing shortage.

“Right now, the housing market favours the investor over just the average human being, and we prioritise our freedom to speculate and invest and profit off of housing,” said Joe Lavine, 28, a social worker who does outreach with homeless residents. He questioned why the moratorium doesn’t include neighbourhoods zoned for multifamily housing, which tend to be in poorer districts and have more people of colour.

“If you put a moratorium on short-term rentals in single-family neighbourhoods, then if an investor truly wants to buy and invest in short-term rentals in Athens, they’re going to go to multifamily zoned neighbourhoods,” he said.

In South Bend, Constance Peterson-Miller and her husband, Christopher Miller, bought their Cape Cod-style house in 1993 for about US$45,000 in the residential Harter Heights neighbourhood, blocks from Notre Dame Stadium. Now they’re nearly surrounded by short-term rentals – two across the street, one next door, and one bordering their backyard. With so many investors scooping up homes, Harter Heights has been irrevocably changed.

“What we have are a lot of empty houses rented out occasionally, with all its attendant issues that are unaffordable or just not available to the new folks coming in,” said Peterson-Miller, 64. “Houses are being purchased, flipped, and then they stand empty for sometimes weeks upon weeks. It appears they are let out for the space of a few weekends during the football season.”

In Harter Heights, rents for one-bedroom apartments have risen 89 per cent since 2013, according to data compiled by the federal Housing and Urban Development agency, dramatically outpacing the national average.

Officials in South Bend can do little to stop the surge. In 2018, Indiana’s Legislature enacted a law prohibiting local governments, cities and counties from passing ordinances regarding short-term rentals, said Troy Warner, a City Council member. Warner understands the power of market forces, but if he could improve that law, he said, he’d restrict the percentage of a neighbourhood that can be used for short-term rentals. He’d also like the law to require property owners who rent their homes to give their contact information to local officials.

“Every time I’ve got an issue, I have to go through property records, and it’s very hard to find out who owns these,” said Warner, a South Bend native whose district includes Harter Heights.

Kip Tyner, the City Council president in Tuscaloosa, has no problem with homeowners renting out rooms or even vacating their homes on football weekends for fans of the Crimson Tide. But investor-owned homes have no place in a residentially zoned neighbourhood, he said.

“It’s so hypocritical of us as a city because we don’t allow a hair salon, we don’t allow a tax preparer or whatever to be in a neighbourhood because that’s a business,” Tyner said. “So you’re going to allow short-term rental, which is definitely a business. People are making huge amounts of money in our neighbourhoods, but they don’t even live here.” NYTIMES