Worcester Tries to Keep and Grow Affordable Housing
Eric Batista, the City Manager for Worcester, wants the city to create a Housing Production Plan (HPP) and Affordable Housing Preservation Program (AHPP), according to a story on MassLive.While not a requirement, a Housing Projection Plan is something most Mass cities have. The HPP sets forth the community’s goals for housing in general and affordable housing in particular. If the state’s Housing and Community Development Department (DHCD) approves a municipality’s HPP, then any decision by that municipality’s Zoning Board of Appeals to deny a comprehensive permit application will be upheld under chapter 40B. Without this, developers can override zoning regs to put in 40B housing.Worcester is well above the requirement of 10% housing stock affordability, but a HPP is still a useful tool to create a plan for development and it helps city officials make development decisions. In 2022, Worcester passed an inclusionary zoning policy that requires all developments with 12 or more units to reserve 10-15% of their housing as “affordable.” Affordable housing means a variety of things, and most broadly means that people earning up to 80% of the AMI can live in those units. As median incomes grow, those “affordable” rents also increase.Some in Worcester are pushing for 60% of the AMI to be the cutoff for housing deemed affordable, rather than 80%.Batista’s Affordable Housing Preservation Program would use $1 million to help preserve currently affordable units that don’t have deed restrictions requiring them to be affordable. The program would give landlords a one-time payment of $15,000 per unit in exchange for a 15 year deed restriction to maintain affordability.
1,000 New Apartments Planned for Downtown Worcester
A MassLive article from April 18, 2023 (full article here) details several upcoming residential and mixed-use development projects that, if completed, will add 1,000 residential units to the city.The projects are:35 Portland St (currently a parking lot behind the Hanover Theater) to create 108 studio and 1BR units. Planning permission granted April 2023.274 Franklin St (several blighted parcels totalling 3.75 acres) 364 units from studios to 2BRs, 21 of which will be ADA accessible. Construction to begin Spring 2023.5 Salem Square (former site of Notre Dame des Canadiens church, demolished in 2018). 163 units, 14 of which ADA accessible. A 20,000 SF grocery store and ground floor parking garage. Preliminary planning permission granted March 2023.3 Eaton Place (currently vacant land) 145 units, 12 accessible. Preliminary planning permission granted in 2023.484 Main St (former Denholm Department Store, owned by the city). The Worcester Redevelopment Authority issued an RFP in 2022 and is reviewing submissions for redevelopment to include housing.
Daly Appraisal Post - North Shore - Beverly thinks about limiting growth
NORTH SHORE HOUSING. A regional approach to housing needs to be advocated to quell NIMBYism. Beverly has added 1,400 housing units since 2014, when new Mayor Michael Cahill made housing a priority. But the growth has led to complaints from residents about poorly maintained streets and an aging & shut down bridge connecting the west side to the downtown. City Councilor Matt St. Hilaire says downtown story heights of apartment buildings should be reduced from five to three. Saugus and Peabody have already adopted similar anti-housing measures.Read full article here:
Daly Appraisal Post - Online Boston Atlas
The Boston Public Library has a new mapping program to discover the presentation of a property in an old city atlas. For instance, you can type in a Marine Road address in South Boston and discover it used to be called Ninth Street. Or type in the address for the Boston Garden (a/k/a TD Garden) at 135 Causeway Street and find out that North Station was once called Union Station. Or find proof that 4 Yawkey Way (Fenway Park) used to be called and unfortunately is now again called 4 Jersey Street. Here's link to mapping program: https://www.atlascope.org/Read full article here:
Daly Appraisal Post - Cape Cod bridges
Bourne Bridge and Sagamore Bridge will not be replaced anytime soon, likely a negative impact for Cape Cod.Read full article here:
Daly Appraisal Newsletter - Demand for Medium-Size Housing Swings Back
Appraisal Insights
Illustrating the power of real estate appraisals to provide valuable property and market insightsSometimes we discover a surprise gem when appraising commercial property, such as this organ now located in a Waltham retail store. It bears the inscription, "New England's Premier Organist John Kiley played this organ for the Boston Red Sox at Fenway Park for over twenty years." Mr. Kiley was organist from 1953-1989. He passed away in 1993.
Here's a sampling of some of our recent appraisals:
Retail and office building in Waltham Center
An industrial and automotive building in Waltham
A 1,200-SF parcel in South Boston approved for a 3-unit condo complex
An undeveloped vacant lot in Dorchester
A condominium complex being developed in Westfield
A used car lot in Springfield
A 20,000 SF Class A office building in West Springfield
An ice cream parlor & diner in Hampden
A hair salon & upstairs apartment in Medford
Featured Article
Demand for Medium-Size Housing Swings Back
By Linda Sakelaris
Staff Writer
Housing developers have spent the past decade building ever-larger homes just as the average U.S. household unit was shrinking.
This demographic upset has negatively affected existing home sales in the Northeast, where sales of existing homes fell 2.9% in July although existing home sales were up 2.5% nationwide.
Problems in New England have been blamed on an inadequate inventory of medium-size homes. The shortage has driven up prices, resulting in higher mortgages and greater obstacles for middle-income buyers.
Builders, however, appear to be shifting focus. Last year, the average size of new homes fell to 2,320 median square feet (SF) from 2,500 SF in 2015. This indicates that developers may address the “missing middle housing,” a term coined by California architect Daniel Parolek. Middle housing is affordable to middle-income buyers and includes duplexes, courtyard apartments, bungalow units and multiplexes as well as starter homes.
Since the 2008 economic downturn, the percentage of newly constructed homes larger than 3,000 SF has increased from 19% to 30% of new homes, according to Disruption Demographics, a recent report by real estate advisory company RCLCO.
Since mega-size homes go against the trend of shrinking household size, new home production appears to be moving in the opposite direction of U.S. demographics, according to the RCLCO report.
Increase in Non-Traditional Households
Demand for medium-priced homes is currently coming from two major classes: baby boomers and millennials. Married households without children and single households are expected to account for 69% of household growth in the next 10 years.
Baby boomers, with assets and established purchasing power, are beginning to downsize, and now seek smaller solutions that are flexible and modern. This group is an important customer for the home market since they will likely use their current home value to purchase another home.
Millennials, while still building their earning power, are capable of entering the home market but developers will need to properly align home products with prices to meet this demand, the RCLCO report states. Compared with prior generations, millennials are having fewer children, driving average household size down.
If the needs of these two buyers are not addressed, the size of the new housing market could decline, experts say
What Do These Buyers Want?
Consumer preferences have changed in the past decade. While the detached, single-family home remains the most desirable product, at least 15% of buyers would now consider an attached townhouse or plex product.
Both boomers and millennials want to be close to activity and mixed-use development, such as shopping, services, jobs, shared open space and a walkable neighborhood.
Older buyers in particular are attracted to master-planned communities for the sense of community, safety and maintenance services.
Also, in demand are open floor plans that meld multiple rooms. While entertaining, guests in the kitchen can see guests in the living room, a system that requires design continuity that interconnects the spaces.
The dining room, which has been less pronounced in recent construction, is coming back but without the formality. Today’s dining rooms are comfortable and friendly, with perhaps a comfortable, well-lit adjoining living space.
Wall-free interiors first became popular in the 1970s, representing freedom from the succession of small rooms often found in older New England homes.
While it remains a popular concept, there is some indication that buyers wouldn’t mind a few privacy walls here and there. “Buyers are moving away from uninterrupted views,” Boston real estate agent Loren Larsen told the Boston Globe in March. Some spaces, some items, deserve a little privacy.
Daly Appraisal Newsletter - Vol 6
Appraisal Insights
Boston's Changing Face: The picture above, taken circa 1968, is the marquee for South Boston's Broadway Theater. The long vacant building is being developed into 42 condominiums or apartments. Plans include a shared roof deck and 42 underground parking spaces. The back portion of the building along Athens Street has been demolished and is being replaced with a six-story, 44,000-square-foot addition. The old theater's lobby will reportedly become a lobby for the complex.
Featured Article
Micro-Housing:
Changing the Way Cities are Organized
The Village Concept
Micro Units
Developer & Investor Point of View
Daly Appraisal Newsletter - Vol 5
Appraisal Insights
Welcome to the fifth issue of Appraisal Insights! We've launched this newsletter to share customer stories and illustrate the power of real estate appraisals to provide valuable property and market insights.Recent appraisals that we’ve written or are working on include:
- A racquetball club in Worcester County converted to an office building.
- A refurbished Brimfield farmhouse on 77 acres used as a single family dwelling and working animal farm with horses, pigs, chickens, and goats.
- A six house subdivision in Worcester.
- A dilapidated retail strip in Dorchester that will be redeveloped for retail and apartments, or just apartments.
- An industrial complex in Boston's Hyde Park neighborhood.
- The old Jordan Marsh building in downtown Lowell.
The picture above is of the old Jordan Marsh department store in downtown Lowell. The property is known as the Bon Marche' (translated as “bargain price”) building because that was the name of the department store that occupied the property from 1887 until the Jordan Marsh company took it over in the 1970s. Jordan Marsh went out of business in the mid 1990s. The property was refashioned into office and retail space and now houses, among other tenants, the Lowell Public School administrative offices.
Featured Article
Greater Boston's Housing Crisis:A 21st Century Village ApproachPart IIBy Jim Daly
Two recent stories in the news show how the housing crisis affects the old and young. The first is about how cruel the effects of gentrification can be, the second about how landlord mismanagement continues to plague students seeking livable dormitories and off-campus housing.Story 1: A Princeton University study estimates that 43 tenants per day are evicted in Massachusetts. It's almost double what the rate was in 2005. Boston Globe Magazine profiled one tenant facing eviction. Jerome Stanley, 64, a Boston school bus driver, was evicted from his Roxbury apartment after living there for 27 years. New landlords were seeking to raise his rent by 70%. He couldn't afford it and became one of an estimated 20,000 people in the state who are homeless. "Close your eyes and imagine the joy you have with your work, look at your home and imagine the time you have with your children," he wrote the Globe, ". . . then tomorrow suddenly after 30 years it's gone." A link to the story detailing how he represented himself in housing court is below.The second story is about the calamities that befell students occupying the first-ever dorms at UMass Boston. The two new dorms, which opened in Fall 2018, have 1,077 beds. In the first weeks of school, elevators with students inside abruptly fell several floors. According to the Boston Globe, "water shot out of one toilet when you flushed another . . . the rooms are often stifling hot, but the showers are frigid . . . and the hamburgers in the dining hall are sometimes raw." A link to the story, in which the development company tries to explain what happened, is below.These two stories are linked because they illustrate the need for a coordinated approach to dramatically increase not just housing, but housing that fits the needs of the region's changing population.Suffolk County's population has increased by 9% since 2010. Boston's population of 675,000 is expected to increase to 725,000 by 2030. Mayor Marty Walsh has pledged to increase housing by 53,000 units during the interim. His initiatives have gained momentum, according to the Greater Boston Housing Report Card 2017 from Northeastern University.One sign of progress is that there were 12,900 permits issued for new structures in Greater Boston in 2017. Two-thirds of those were for multi-families. Also in Boston, the wait time for new building permits has decreased from 425 to 120 days.There are few other signs of progress. Home prices continue to soar. Rents, the fourth highest in the country, show some signs of the leveling off and decreased slightly (<3%) in 2017 after increasing 6.9% per year from 2009-2016. Inventory of both single family houses and apartments are at record lows.Barry Bluestone and James Huessy, the authors of the Greater Boston Housing Report Card 2017 study, are calling for a more coordinated approach. Their 21st Century Village concept calls for housing that fits the needs of Boston, which increasingly is becoming younger ~ students and Millennials ~ and an aging population ~ people like Jerome Stanley, many of whom live by themselves.Bluestone and Huessy think the units need to be built quickly but worry that cities and towns will fail to take a coordinated approach. I have seen little in the news that suggests that leaders, with the exception of Mayor Walsh, are endorsing the plan. The study's main points are that:
- A consortium approach is needed from political and business leaders such as the governor, regional mayors, hospital CEOs, and local university presidents.
- The authors propose villages comprised of multi-story buildings that range in height from five to 35 stories.
- Each "village" could contain a range of units from "micro" apartments to studios and multi-bedroom units.
- Each village would have a community space with lounges, laundry facilities, seminar rooms, study areas, gyms, and roof gardens.
- Construction would incorporate modular design and panelized construction using new materials and high productivity building techniques.
- Leaders should investigate the feasibility of opening a state-of-the-art manufacturing facility in Greater Boston, where modular units and panels could be fabricated.
Further reading suggestions:1) Greater Boston Housing Report Card 2017.2) “As rents soar in Boston, low income tenants try to stave off eviction," by Jenifer McKim and Alejandro Serrano. Globe Magazine, February 19, 2019. 3) “Falling elevators, raw hamburger, lax security at UMass Boston dorms," by Laura Krantz. Boston Globe, November 11, 2018.
Daly Appraisal Newsletter - Vol 4
Appraisal Insights
Welcome to the fourth issue of Appraisal Insights! We've launched this newsletter to share customer stories and illustrate the power of real estate appraisals to provide valuable property and market insights.Recent appraisals that we’ve written or are working on include:
A office building in Hopkinton on a parcel that could be converted to a parking lot
A commercial building in Dorchester's Adams Village that once housed multiple retail and office tenants
Vacant land in Burlington that belongs to a church and is slated to be redeveloped for single family use
A former farm property in Uxbridge converted to retail, restaurant, and industrial use
The picture above is of William Callahan, the man responsible for the construction of the 123 mile Massachusetts Turnpike. Before the elevated roadway opened in May 1957, Boston was suffering from economic malaise due to deteriorating railroads and a decaying seaport in a state where it was difficult to transport goods and services. Many credit the toll road for reviving the region's economy so that Boston could become a world class city. Here Commissioner Callahan points to Worcester, the city that was bypassed by the turnpike to much consternation. Because he hired 33 contracting companies to work simultaneously, it took only two years for the roadway from Exit 1 in the Berkshires to Exit 14 at Route 128 to be built. It wasn't until February 1965 that the 12 mile Boston extension from Exit 14 to the downtown was completed.
Featured Article
The Housing Crisis:A 21st Century Village ApproachBy Jim Daly
In our dramatically appreciating housing market, we often fixate on the increases. It fascinates us that the median sale price of a 4BR home in Canton is $675,000 and the average monthly rent of an apartment in Greater Boston is $2,874. The numbers alone seem like signs of progress. After all, why shouldn’t someone who took care of a home for 25 years benefit handsomely and enrich their retirement? But as a whole, such numbers are signs of an unrelenting housing crisis.Those are the conclusions of the Greater Boston Housing Report Card 2017, a Northeastern University undertaking that Barry Bluestone, the founding dean of the School of Public Policy and Urban Affairs there, arrived at after careful study. (The other author of the study is James Huessy). The good news is that Greater Boston has reached nearly full employment, with 284,000 jobs added since 2009. About 350,000 jobs were added during that time period to the state as whole. But with housing costs increasing by 5% per year and family income going up by only 1%, the percentage of income spent on housing has become astronomically high. The report estimates that the average annual rent in Greater Boston is now $35,000 and the average household income is $62,000.The report explains that the housing being obtained for such high rent wasn’t built to fit the needs of its tenants. Bluestone focuses on the triple decker, the miracle structure that saved Boston from the housing crisis of 1870 to 1920. With immigration, the population had tripled from 250,000 to 750,000. The three families were cheap to build and had the attraction of additional income. They allowed the working class to establish a foothold here.In Boston, Somerville, and Cambridge, 40% of the combined housing stock are triple deckers. What Bluestone calls Boston’s Inner Core (those three cities) has almost 74,000 students who live off campus, more than half of them graduate students. “Millennials are doubling, tripling, and quadrupling up triple deckers, outbidding working families for what was traditionally working family housing,” the report states. But for how long do people in the 25-34 age range want to live with multiple roommates? Prices have been driven up so high that there’s nowhere for them to go. Housing inventory is so low that the market sometimes seems to be standing still.Across the country, home ownership has decreased. According to the U.S. Census Bureau, in 2000, 40.7% of those in the 25-34 age range owned homes. In 2015, that number decreased to 30%. In the 35-44 age category, home ownership in 2000 was 67.2%. In 2015, it decreased to 58%. Some of that decline is due to student loan debt and the fact that many couples are getting married later. But a lot is due to the housing crisis.Only new construction can help moderate housing costs and provide a better fit for the 725,000 who are expected to inhabit Boston in 2030. The city has about 675,000 inhabitants now. Bluestone and Huessey suggest a long-term collaboration between leaders in the political, banking, construction, medical, and academic fields. Their idea - 21st Century Villages that include micro apartments, common shared spaces, and ground floor retail – are detailed in a YouTube clip entitled Greater Boston Housing Report Card 2017. Stay tuned for Part II of this article in an upcoming issue, in which I'll focus on Mayor Walsh's ambitious housing plans for the city and how Bluestone and Huessey hope leaders in surrounding communities will emulate him.Further reading suggestions:1) Greater Boston Housing Report Card 2017.2) “How Did Renting in Boston Become Such a Nightmare?” by Thomas Stackpole. Boston Magazine, May 30, 2018. 3) “Anwar Faisal: Lord of the Sties." by David Bates. Boston Magazine, December 31, 2013. The Keystone Mill in Easthampton in Hampshire County houses INSA, one of the first stores in the state to sell recreational marijuana legally. This brick building was repurposed from an old factory and now has multiple tenants. Next door, a similar building, The Brickyard, houses a brewery tenant that recently expanded its bar and function room space. The upper stories of both buildings may one day include apartments.