Nome’s housing crisis worsened
By Julia Lerner
Simon Kinneen, a Nome landlord who owns and manages eight apartment units with his wife Maggie, recently listed a two-bedroom, one bathroom apartment for rent on Facebook: $1,800 per month, in-unit washer and dryer, no pets.
“I posted the ad and immediately went to sleep,” Kinneen told the Nugget. When he woke up, he had more than a dozen messages expressing interest in renting the available space. “I had 10 or 15 responses in the first 5 to 10 minutes.”
Since he posted the apartment on June 28, Kinneen has received more than 35 applications to rent the apartment.
“I’ve gotten requests from all sorts of people interested in it,” he said. “Some are just here short-term looking for housing, some people have been living here for quite a while, and some have been living in a hotel waiting for housing or on waiting lists, or people recruiting on behalf of new teachers coming in and looking for space.”
Kinneen’s apartments are not the exception, but the rule here in Nome, where housing availability is limited, construction costs are skyrocketing and demand is constantly growing.
“Because the cost of new construction is so expensive, we are not seeing very much new construction happening,” explained realtor Melissa Ford, owner and broker at Nome Sweet Homes. “There’s just not a very big inventory for either purchasing or for renting. It is really devastating for people who are trying to find first-time homes and people who are renters, just because we’re not seeing any increase in our inventory housing stock.”
Nome Sweet Homes sells both residential and commercial tracts in Nome and Kotzebue. Their website currently lists ten residential properties in Nome for sale or rent, and zero in Kotzebue. Of the ten in Nome, four have already sold, and another three are pending sale. One of the three remaining properties is a two-bedroom, one bathroom fully furnished rental listed for $1,500 per week, or $6,000 per month.
Nome renters have to prepare to pay “premium prices” for the few open spaces, Ford explained. Premium price could mean as high as $4,000 per month, she said, with average prices around $1,000 per bedroom.
For decades, the U.S. Department of Housing and Urban Development (HUD) has encouraged renters to spend around 30 percent of their monthly income on rent, but Nomeites often pay significantly more. In Nome, the median household income is $61,048, meaning the median renter should aim to pay around $1,526 per month.
In Nome, HUD-established fair market rent is set at almost $1,200 for an efficiency, $1,259 for a one-bedroom, $1,534 for a two-bedroom, $1,970 for a three-bedroom and over $2,000 for a four-bedroom for the 2021 fiscal year. The Nome fair market rent area is one of the most expensive in the United States, and more expensive than 97 percent of other fair market rent areas established by HUD.
Support services, like the Bering Strait Regional Housing Authority, are struggling to meet the demand in the region’s rural villages.
“The regional housing authority works through the U.S. treasury and HUD to provide housing in Nome for low-income people and seniors at market rent, which is just what the market will allow,” explained BSRHA Housing Manager Colleen Deighton. BSRHA provides rental assistance and support for homebuyers, in addition to home construction each summer.
“We have a wait list in every single village for open houses,” Deighton said. “We do not have open houses in every village.”
BSRHA was allocated more than $8 million for the emergency rental assistance program, ERA for short, a financial assistance program providing up to one year of financial support for low-income renters in the Bering Strait.
“The purpose of the emergency rental assistance program is to help low-income families who have been affected by COVID so they can avoid eviction,” said BSRHA ERA program coordinator Asaaluk Irelan. “This is helping with their housing security, as well as with their utilities, electricity, fuel, water and sewer.”
So far, more than 100 regional residents have applied for ERA support, though the application period will go until September 1 this year. Though the ERA fund was initially limited to tribally enrolled residents, the BSRHA board of directors voted in late June to open the funds to all regional residents. “It’s better for the region when everyone can pay their bills,” Deighton said.
Increasing property costs have driven city leadership to seek alternative options for housing staff.
“The price of housing can vary wildly,” said Nome City Manager Glenn Steckman. “This is not like a normal community where you go online, and very quickly find housing, whether it’s apartment buildings or anything like that.”
Steckman said that the housing crunch in Nome varies with the season, with tourists and construction crews filling rentals and hotel rooms during the warm months.
“We have a lot of summer workers coming up here and working on road projects, making it a challenge to find housing,” Steckman said. “That’ll be the same challenge that we face when we expand the port, and that’s why one of the requirements in any expansion of the port is that there is going to have to be housing here to accommodate those coming up to work.”
The City joined the Nome Public School District in a construction project to develop new housing opportunities for teachers and police officers traveling to Nome for work, though construction has stalled significantly as a result of the COVID-19 pandemic and resulting cost increases in lumber and building materials.
“We’re impacted just like everybody else who wants to build something,” Steckman said. “The price of construction materials has skyrocketed because of COVID-19, and we’re waiting for the market to readjust.”
Superintendent Jamie Burgess explained the project challenges during a June schoolboard meeting. “The estimate for completion of the building is fairly high, simply because the cost of wood right now is almost 300 percent where it was pre-COVID,” she said. “Part of the discussion is trying to figure out the best way moving forward to get it done at a reasonable price.”
The COVID-19 pandemic also highlighted additional housing needs in the region.
“We do have a lot of families that are living with two or three bedrooms and a lot of people in them,” Ford explained. “It’s hard to quarantine when you’ve got 10 bodies in a two-bedroom house. I’ve seen people try to live four people in an efficiency apartment, and you can’t really quarantine someone effectively when you’re doing that.”
As Nome continues to develop and construction projects increase demand on the already-strained stock, the city will have to figure out how to develop additional housing, Ford says.
“One of the things that I have suggested for the city is that they waive the taxes for property improvements for a set time, a couple of years,” she said. “Right now, they do have lots that they’re letting go of, but my suggestion would be to let loose a lot more land and do it at a discounted price so that there are people who have an incentive to develop.”
The planning commission is currently reviewing results of a public survey. One question asked if “Nome has enough housing” and 94.76 percent of the 229 respondents disagreed.
For now, landlords like Kinneen are dealing with the crunch.
“I wish I had more rentals to rent out, or just that there were more rentals in general,” Kinneen said. “There’s just so many people looking for housing. It’s really quite incredible.”