Wednesday, June 02, 2010

Tales of 40b

The Campaign to Protect our Affordable Housing Law, has, as several of their members, people who live in 40b affordable housing units across the state, showing which housing developments they live in.

I thought I'd take a look at the housing developments.

One of the members lives at Elmwood Village in North Reading. There were 35 townhouse units built there, with 7 of them being "affordable." Those 2-bedroom units all go for $184,000 and are available to first-time home buyers who earn 80% of the median income in North Reading, or less, according to the town's website.

I checked out's listings in North Reading for homes that cost less than $184,000 and found 13 listings (some of them quite cute!), out of 73 total listings in North Reading -- and not a single one of them, as far as I'm aware, would be considered "affordable housing" in North Reading. So, to be accurate, approximately 18% of all the listed homes for sale in North Reading cost less than the seven "affordable" units at Elmwood Village. Furthermore, while North Reading is technically under the 10% state threshold for affordable housing, 18% of their properties currently for sale cost less than the "affordable" units. Wouldn't that mean that almost 20% of North Reading's property on the market is actually affordable, at least compared to whatever metric the state uses for its 40b policy?

Lest anyone think this phenomenon is unique to North Reading, let's check out some of the other "affordable" housing units out of people on the 'coalition for affordable housing.' Take a look at The Ridge Luxury Apartments in Waltham (note how the coalition to protect affordable housing left off the fact that these are luxury apartments). It has 264 units, with a state-required minimum of 25% 'affordable' units... which cost $1,500 a month for rent for a 1 bedroom. It's "affordable" only compared to the other units at the complex. Finding prices for apartments for rent is a bit tougher than homes, but there's literally 73 in the area of Waltham for $1,500 or less, and I found at least 11 at that price or less for rent in Waltham at this site. Few, if any, of those would be considered "affordable" under 40b, as it applies to the 10% threshold.

That's just a small slice of the picture. If people want to look into the other towns and communities, they'll probably see a similar picture. The only town which didn't have a number of homes below the sale price was Marblehead's The Reserve at Oliver's Pond development, which is including 5 affordable units amongst its 15 homes other condos on the market for over $600,000. The affordable units were going for $156,000 and there were only three homes more affordable than that in the town. A town like Marblehead really needs a whole lot more affordable housing -- the town's 500 units away from the state's goal of 10% -- but this 40b approach shows just how frustrating the law is for cities and towns under the threshold. Yes, it created 5 new units toward the 10% goal, but it also created 15 new units against it. For all intents and purposes, this doesn't really get the town any closer to the promised land.

People should be opposed to NIMBY zoning laws that try to prevent ordinary citizens from being able to afford living in the communities of their choice -- and there's a place for a policy like 40b, but it needs to be severely tweaked before election day, or voters should vote to repeal. In fact, as the Wicked Local article I just linked to says, the state has another, friendlier and smarter affordable housing law -- Chapter 40R, which establishes "Smart Growth" zones. However, that's not where developers make their bread and butter -- and, at the end of the day, that's what this is really about.


James said...


There are a few key points you overlooked in your analysis.

First, North Reading is above the 10% threshold

Second, there is a large difference between the newly built townhomes and the homes. One set is new construction, and the other is not. That makes a difference in many substantive ways including the cost of providing the home, the value to the seller, and the speed at which it can be produced. We can't build old homes, right? More importantly, things that are "affordable" on are only affordable as long as the market says so. The homes that are affordable under chapter 40B have long term restrictions that will keep them affordable even if the market drastically changes. This is an issue here in Somerville because many of our once affordable homes are now way out of reach to the ordinary person.

There absolutely are issues with this law. But, the question we are facing in November is not whether this affordable housing law is perfect or what can be fixed. It is only about whether to keep the law that has produced 80% of the affordable housing outside the major cities and added to the market rate stock in a way that helps our state remain competitive. Or, to drop it all together.

Ryan said...

James -- I just don't think this can be fixed until it's axed. Too many special interests. If it could be fixed, it would have been a long time ago.

I fully support having a strong set of policies for affordable housing, much stronger than 40b even (at least insofar as it would have to require many more affordable units than 25%), but 40b isn't going to ever be that. The people behind the attempts to get rid of 40b on the ballot are absolutely right in the fact that this is really the only way to change it at all.

As for the differences between the affordable townhouses and condos, compared with other homes available in communities that cost less than those units, I do think it's a perfectly fair point to make. First off, as far as I'm aware (and by all means, correct me if I'm wrong), the prices of the "affordable" units at these developments are fixed at predefined 40b affordable rates, in large part defined by median community income -- the fact that they are a part of these luxury developments is really immaterial.

Whether the other units in these developments that weren't marked as affordable units were selling for $350k or $650k, the affordable units would have the same, fixed price. Given that, if there are homes in communities with the same number of bedrooms and similar square footage that cost less than what would be the 'affordable' rate, those homes should count toward a community's 10% threshold, because that means those homes are 'affordable,' too.

Thanks for the correction, though. Good for North Reading. It takes a real, long-term commitment from suburbs like North Reading to meet that kind of threshold. It's my hope that more towns like North Reading will make it easier to get affordable units built in their communities, and that the state will take this ballot initiative as the impetus to go ahead and change 40b to make it both better and more fair.

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