“We have to be the change we want to see.”

So said Housing Assistance chief executive officer Alisa Magnotta in her closing remarks at the Housing to Protect Cape Cod Summit earlier this month.

The event, which drew a crowd of more than 300, included some of what keynote speaker economist Tim Cornwell called “doom and gloom,” but it also highlighted avenues for fighting Cape Cod’s housing crisis. Speakers included local business leaders and workers along with Cornwell, whose analysis of how the housing shortage impacts Cape Cod’s economic outlook paints a stark picture.

The event at the Cape Codder Resort in Hyannis was the official launch of the Housing to Protect Cape Cod (HPCC), a partnership of Housing Assistance, the Cape Cod & Islands Association of REALTORS®, the Cape Cod Chamber of Commerce, CapeBuilt Companies, and the Homebuilders & Remodelers of Cape Cod.

The summit also marked the official release of a new report that analyzes the economic effect of the current housing crisis on Cape Cod’s workforce and local businesses. The report, “Housing Market Overview and Economic and Fiscal Benefits of Housing Development,” was produced by The Concord Group, a company led by Cornwell.

The report utilized data to demonstrate that tight workforce housing inventory coupled with high real estate prices and rent has caused a severe labor shortage on the Cape in the retail, service, and elderly care sectors. The report states that without our towns prioritizing affordable and attainable housing, Cape Cod is at risk of losing a tremendous portion of local workers and businesses.

“The displacement the Cape is experiencing is unsustainable for its economy,” said Cornwell.

According to his study, the Cape is losing more than 800 households a year of those making $100,000 or less a year. And nearly 50 percent of people who work on Cape Cod commute from another county.

Magnotta said Housing Assistance commissioned the report after staff noticed an increase in “nontraditional clients” in need of housing help.

“The people coming into our office were fully employed, they had lived in their rental for 10-15 years, and they were now being displaced and looking for a place to live,” she said. “This seemed bigger than just the context of the situation that was happening because of COVID.”

Among the speakers was Anne McManus, CEO of Latham Centers, which works with children and adults who have developmental disabilities. “Every month, I hear stories from my staff about their inability to afford to live on Cape Cod,” she said. “I’ve had staff members move to North Carolina because it’s cheaper to live there. The problem is huge for us and we see it every day,” McManus said.

State Rep. Sarah Peake and State Rep. Kip Diggs were among the summit attendees and State Sen. Julian Cyr spoke to the crowd, saying that housing was his number-one priority. Cyr, who got his start as a political organizer when he was a junior at Nauset High School, said that showing up at town meetings and planning board meetings makes a big difference.

“We’ve got a tremendous amount of say in what happens at the local level in our communities,” he said. “Part of the problem is not just who is showing up but who’s not showing up – and a lot of us aren’t showing up. I see the elected municipal officials nodding their heads. We’ve got to figure out a way to show up.”

Magnotta urged the attendees to commit to group efforts working for change. “We’ve heard about the zoning that needs to change, and it has to happen at the local level,” she said. “We’ve heard about the funding resources that we need, that need to come from the state and from the federal government and also our towns. It’s not a one trick pony. It’s not one solution. We’ve got to pull multiple levers and we have to engage at multiple levels throughout our community.

“I’m hoping that from this point forward, we will all commit to getting involved. Today is day one of action.”

Magnotta said the next steps include creating sub-regional groups and town-specific working groups to educate and engage local residents about changes necessary to protect year-round communities. Those groups are scheduled to convene during the first quarter of 2023.

The Concord Group Report “Housing Market Overview and Economic and Fiscal Benefits of Housing Development,” can be found at housingtoprotectcapecod.org or haconcapecod.org.

Just a few of the speakers at the Housing to Protect Cape Cod Summit (pictured from left to right): Tim Cornwell of The Concord Group, Lisa Oliver of The Cooperative Bank of Cape Cod, Paul Niedzwiecki of the Cape Cod Chamber, and Anne McManus of the Latham Centers.

KEY TAKEAWAYS | from the Concord Group Report

We are seeing a huge displacement of households making $100,000 or less. Through 2026, ESRI Demographics is projecting a loss of 829 households per year that earn within that income segment due to an inability to find housing.

Out of the 87,856 employed labor within Barnstable County, more than 42,000 people live outside the county boundaries. That is almost 48% of the work force. Some popular home destinations off Cape include New Bedford, Boston, Fall River, Brockton, and Plymouth. It is putting enormous strain on our infrastructure, and working people are spending too much time commuting to their jobs as a result.

From 2010-2020, GDP in the County has grown by ~2% cumulatively, much less than the national growth rate of ~11% during that period. Over the same period, GDP and employment growth has been significantly positively correlated, as each metric typically follows the other. As employment losses continue to mount, GDP is likely to also experience losses until many businesses are unable to capture enough revenue to warrant remaining open.

Cape Cod’s dependence on single-family home zoning (82% of all residences are single-family homes) has been detrimental to our wastewater problem. Such zoning was thought to slow development, but it actually has made sewering harder to execute.

We have not built enough of year-round or multi-family housing year-to-year in the last decade. The number of permits issued for single-family units has greatly exceeded the number of permits issued for multi-family units. The 10-year average (2012-2021) for multi-family building structure permits is 137, while the average for single-family building permits is 453. The shift to more seasonal housing is a problem, too. Between 2010 and 2019, total housing units in Barnstable County increased by over 4,700 units. However, the number of year-round occupied housing units declined by over 3,800.

 

RECOMMENDATIONS | from the Concord Group Report

Towns must look beyond the arbitrary target of 10% “capital A” Affordable inventory. Only focusing on building affordable units catered to extremely low income and low- income residents will not remediate the issue. The costliness of these projects both for developers and municipalities makes it impossible to scale and build enough units.

Towns should be monitoring the number of seasonal rentals, year-round rentals, second home ownership (part-time residents), and year-round ownership so that the balance does not continue to shift towards second home ownership. The only way to achieve or preserve such an appropriate ratio is by building meaningful new supply, including dense multi-family product catered to the workers in each town that keep the local economy running.

As of 2020, there were 28,789 households on the Cape earning $50K or less and only 1,789 “capital A” Affordable units. To decrease this gap, the Cape must commit to getting closer to the 1/3 year-round rental ratio each year. As seen in the analysis, adding 250 multi-family housing units will contribute significantly to providing more opportunities for households in addition to bolstering the local and regional economy.

Every locality across the Cape must be committed to closing the gap by supporting the reformation of zoning laws and provide development incentives to multi-family builders so that the market can respond effectively. Typically, this proportion of wholly affordable units will be anywhere from 15%-25%, depending on the needs of a community.

Localities should work with development partners to create other avenues of affordability including smaller units, higher bedroom count per unit, creative units including macro-units, multi-generational housing, densification scenarios, and other toolkit items in order to maximize housing production and its effectiveness in meeting the full-time residents’ demand.

In addition to building more units, municipalities must unite around legislation that pools funds for financial assistance, rental housing preservation, housing trust funds, and homeowner education programs that seek to make relatively localized improvements, over time, to existing housing conditions.