2023 Year End

The lack of inventory and scarcity of available land in Jackson Hole can be summed up in three words: Conservation versus expansion.

The region’s early history saw development constrained by the natural topography, which influenced where homesteaders could settle. By 1950, the consolidation of the 1929 Park and the 1943 National Monument, which included Rockefeller’s acreage, resulted in a staggering 97% of the valley being designated as public land and the expansion of the Greater Yellowstone Ecosystem.

Of the federal land, the National Park Service owns 45%, the National Elk Refuge 1%, and the National Forest Service nearly 51%. Various state and local entities own the remaining 2.8% within the Town of Jackson and the unincorporated county, amounting to 74,640 acres in private ownership.

The 2.8% of privately owned land in Teton County has seen significant development, conservation, submersion, or zoning for rural densities. Most of the private land, approximately 60,000 acres, is in Jackson Valley, with 1,182 acres within the Town of Jackson. Outlying communities like Alta and Buffalo Valley hold 6,890 acres and 4,030 acres, respectively.

Following the establishment of Teton County’s planning/building department in 1975, the Comprehensive (Comp) Plan with Land Development Regulations (LDRs) were introduced in 1978 which accelerated the development of private land. Prior to 1978, most platted subdivisions had parcels of three to six acres with no dedicated open space for migratory or view corridors. Resort subdivisions—like the JH Ski Corp., JH Racquet Club (Aspens), and JH Golf & Tennis—had already begun development prior to 1978.

The 1978 Comp Plan provided density bonuses for subdivisions that provided 50% or more dedicated open space. The goal was to create smaller, more affordable lots for locals to build their homes, and at the same time dedicate open space for migratory and view corridors. During the next 17 years, subdivisions like Rafter J Ranch (354 lots), Cottonwood Park I & II (186 lots), Melody Ranch (244 lots), Teton Pines (125 lots), and Bar B Bar (69 lots) sprung to life. Other subdivisions chose to develop 3-acre or larger parcels like John Dodge/Homestead (112 lots), Solitude (105 lots), Owl Creek (57 lots), Dairy Ranches (26 lots), and Teal Trace/Pine Meadow (40 lots), which did not require dedicated open space.

The 1994 Comp Plan replaced the 1978 plan and updated the LDRs. A major stimulus for the 1994 Plan was a series of traffic projections and the resultant roadway improvements they foretold. The community realized that a significant amount of growth was occurring and feared that the character of the town and county were about to change.

As a result, the town and county launched a joint planning effort designed to produce a single comprehensive plan and LDR for both jurisdictions. Central to the effort was the objective to direct growth away from a blanket of three- and six-acre lots that the county’s plan and LDRs at the time allowed. The town and county hired a consulting firm to prepare a community-wide, character-based Comprehensive Plan and LDRs. The consultants completed their work, and the town and county planning commissions further developed the plan to its completion.

The 1994 Jackson/Teton County Comprehensive Plan (1994 Plan) provided density bonuses if 70% of the subdivision was dedicated to open space. Unfortunately, only one single-family subdivision, Wilson Meadows, used the density bonus after 1994. Constraints imposed by the plan led to a substantial increase in average housing prices over the next 30 years, stopping development with any significant density for locals to build their homes. NOTE: In 1994, the average sale price for a single-family home was $478,000. At the end of 2023, it was $5.03 million.

Chapter 5 (1994 Plan), Affordable Housing: The analysis of affordable housing was performed in 1994, and the county and town adopted Chapter 5, Affordable Housing in early 1995. The first attainable subdivision of its kind was Mountain View Meadows Townhomes, whose plat was recorded in February 1994.

The 1994 Plan established goals to provide a variety of affordable housing for Teton County’s socially and economically diverse population and establish a balanced program of incentives, requirements, and public and private actions. The 1994 Plan established that 25% of future population increases needed affordable housing. However, the 2007 Housing Needs Assessment suggested that at least 40% of new residential development needed to be affordable.

While the community had made headway in providing affordable housing, by 2007 most local workers were already priced out of free-market homes and had to turn to townhome/condos. NOTE: In 2007, the average condo sale price was $811,860 versus $2.09 million today.

Current single-family home inventory, broken down by decade built (see below), reveals a critical shortage. Limited spec building in the last 15 years coupled with a decline in homes for sale and rising prices presents challenges for both single-family home and townhome/condo Buyers.

Unfortunately, with the spike in interest rates many homeowners choosing not to sell. Economists dub the phenomenon the “rate lock-in effect.” They say rate lock-in happens when homeowners tie themselves to their low mortgage rates from when they bought or refinanced their homes. As a result, they end up staying in their current home even when they long to move up, downsize, or relocate.

Rate lock-in is not victimless (and is not the same thing as “locking” an interest rate before closing on a mortgage). It keeps properties off the market at a time when demand for homes exceeds the paltry supply, causing prices to skyrocket and promoting ruthless competition. First-time home buyers are especially disadvantaged because they don’t have equity to convert to down payments.

Fannie Mae conducted a recent study, and the results showed around 29% of homeowners reported hanging onto their homes for longer than they intended, but their motivations were driven by other factors unrelated to mortgage rates: 19% said they liked their home and location, and 13% said that home prices were too high to buy elsewhere. An additional 13% said they planned to stay because of the location of their job and/or family.

Older generations’ preference to continue to live in their homes as they age may also play a role in constraining supply, Fannie Mae said. The authors noted that nearly a third of homeowners are Baby Boomers, and over 80% said they would like to “age in place.” Unfortunately, our increasing real estate taxes are pushing JH retirees to sell.

As of December 31, 2023 there were a total of 58 single-family homes for sale (down 25% from 2022) at an average list price of $8.625 million (up 13%). Of the 58 homes, only two are listed for under $2 million, and 29 (down 24%) are listed for over $5 million.

Based on homes built between 2020-2024, we are on track to have 764 new homes built this decade. Also note: of the homes built since 2020, 157 were built on less than one acre, 81 were in the Town of Jackson, and 46 scrapped an older home. [If the last stat contains a number with percentage, you may consider including a percentage for the other two stat numbers for consistency]

Homes (6,130) & Townhome/Condos (3,267) Current Inventory

Current Deeded Townhome/Condo Inventory: There are currently a total of 3,267 free-market townhome/condos throughout the valley. Above we’ve broken out this inventory by decade built. NOTE: Of the townhome/condos built and sold on the open market valley-wide since 2020, the average sale price was $3.46 million. Of those 147 units, 118 were built in the Town of Jackson with an average sale price of $2.94 million.

As of December 31, 2023, there were a total of 56 Townhome/condos for sale at an average list price of $2.67 million. Of the 56 Townhome/condos, 9 are listed for under $1 million, and 28 are listed for over $2 million.

Where will Additional Housing Inventory come from? 
Anticipating future housing needs, reliance on existing vacant lots and scrappers is evident. Currently, there are 1,292 single-family vacant lots left valley-wide. They break down as follows: (Put in a box) 103 in the Town of Jackson, 405 on the Westbank (61 in Teton Village, 30 in Teton Pines, 144 N. of Wilson, and 170 S. of Wilson), 429 North of Hwy. 22 to Moran, 224 South of Hwy. 22 to Swinging Bridge, and 131 from Swinging Bridge to the southern county line.

Based on the current absorption rate, the 1,292 lots should provide about 17 years of future inventory. While 14% of the homes built since 2020 scrapped an existing home, we cannot rely on this percentage to continue. With only two homes currently on the market for under $2 million, many Buyers are choosing to “not” scrap and instead remodel and/or add on to the existing structure. This decision is being driven by the high cost of new construction versus remodeling.

There are several state-owned sections still in Teton County, but only two have potential for development. One is on Moose-Wilson Road and the other is near Kelly. Both are 640 acres, but traffic and infrastructure are not conducive for dense development in either.

The evolving demographic landscape—characterized by affluent, Baby Boomer, second homeowners and remote workers—intensifies the demand for housing in Jackson Hole. The self-sustainability of bedroom communities poses challenges, emphasizing the need to explore expansion options such as the proposed Northern South Park development.

Collaboration for Expansion: In 2020, the Town and County sponsored a community-wide planning process to create a preferred neighborhood plan for Northern South Park (NSP). In July 2022, the Town and County unanimously approved a neighborhood plan that set a vision for NSP.

With this plan approved for NSP, the Gill family announced their intention for a once-in-a-lifetime gift of 45 acres of land for affordable and workforce housing to the Community Housing Trust and Teton Habitat. By eliminating land costs for the development of deed-restricted homes, the Gill family is innovating new ways to respond to the community’s intense housing shortage that lessen the burden on taxpayers.

NSP will provide 420 deed-restricted homes, of which 240 will be Affordable and 180 Workforce. If you’d like to know more about the NSP development, as currently being proposed, check out our Podcast . We visited with the Community Housing Trust and Teton Habitat, as well as representatives of the Gill family, and discussed different components of the development, cost and pricing, the expected buildout timeframe, as well as concerns about traffic, schools, etc.

Let’s face it, our local workers have been priced out of this market for 20+ years. The only way to keep our workforce in the valley is through affordable housing efforts.

Self-sustaining bedroom communities: Those of you who lived in JH back in 2007 may remember when Driggs/Victor had four newly approved golf course communities, and over 1,800 platted undeveloped single-family lots. Star Valley was also booming with the new Alpine Meadows (166 lots), a new Airpark, and smaller subdivisions sprouting up everywhere. At the time, concern grew over whether our bedroom communities were becoming self-sustaining, meaning workers no longer needed to commute over the pass or down the canyon—which can be very dangerous at times!

While the Great Recession of 2008-09 slowed the growth of our bedroom communities, they are once again becoming self-sustaining. This time, though, growth has been driven even more by rising home prices. Many of the Baby Boomers, who had planned to retire in JH prior to COVID, had to redirect their searches as prices doubled in Jackson Hole, giving these bedroom communities another boost in demand while their inventory has also been historically low.

We recently reached out to several general contractors in the area to determine the cost of building the American Dream. We found the cost to build a quality, single-family home with above average finishes in Victor/Driggs was $500 per sq. ft., $450 per sq. ft. in Star Valley, and in Jackson Hole costs start at $1,000 and can quickly reach $2,500 per sq. ft. NOTE: If the Northern South Park development moves forward, even with free land, it will still cost $600 per sq. ft. to build Affordable and Workforce housing. Are we at the breaking point for future Affordable housing?

Conclusion: The delicate balance between conservation and expansion defines Jackson Hole’s journey. As the community grapples with the housing crisis, addressing the challenges posed by limited inventory, rising prices, and changing demographics becomes imperative for ensuring a sustainable future. Explore more about the ongoing narrative in our Podcast.