Town Losing Housing Affordability Race

by William F. Galvin

HARWICH – While annual incomes in town have been increasing, the cost of owning a home or renting has far out-distanced the ability of young families and working people to afford housing. That was the clear message in the draft housing production plan presented to the select board this week.

Karen Sunnarborg Consulting is updating the plan in conjunction with town efforts to update its local comprehensive plan. The housing production plan, last updated in 2016, is considered an important component in the local comprehensive plan.

“The town of Harwich, like much of Cape Cod, continues to have a pressing need for more attainable housing, particularly in the context of rising housing values for home ownership and rentals,” the draft plan concludes.

According to Sunnarborg, the median single-family home price was $650,000 in 2023, up from $352,200 in 2010. That represents an 84 percent increase, more than twice the 41 percent rate of inflation during that period. To afford this median price, a household would have to earn an estimated $191,200 based on 95 percent financing. That income is more than twice Harwich’s median household income of $79,641, according to 2021 census estimates.

“The median income earning household could likely afford a single-family home of about $286,500 based on 95 percent finance. The affordability gap is then about $363,500, the difference between the price of the median-priced single-family home ($650,000) and what a median income household can afford,” according to the plan.

Sunnarborg said market rents of about $2,400 for a two-bedroom unit in Harwich require an income of about $106,000. About one-third of renting households face burdens when paying more than 30 percent of their income for housing, and 14 percent experience severe cost burdens. Of the 2,249 houses with incomes at or below 80 percent area median income, 63 percent had cost burdens and 32 percent had severe cost burdens.

“While seasonal and occasional (use) units increased over prior decades, COVID-19 reversed this trend when off-Cape residents moved to Harwich and other Cape communities in search of a safer place to ride-out the pandemic. This surge in housing demand in tandem with limited housing production drained local housing inventories and drove up prices,” the plan reads.

What is further aggravating local and regional housing and economic challenges is the mismatch between what jobs are available and available housing. According to the report, it is not feasible to strictly continue to deliver “capital A” affordable housing, which has income restrictions, as the costs of doing so does not allow for the scalability of the need.

“This will never significantly reduce the imbalance of supply and demand,” the plan concludes. “The development of more market-rate rental units is a necessity to give current and future community members a chance at residency on the Cape.”

Harwich currently has 328 affordable housing units on the state-approved subsidized housing inventory, which represent 4.98 percent of the total year-round housing stock. The town needs to produce 330 more affordable units to reach the state’s 10 percent goal. The town’s goal is 33 units a year.

The plan cites demographic shifts that will have a bearing on housing needs. Trends indicate that increases in the number of older residents and declines in younger people are likely to continue. According to the plan, housing for younger people is critically needed.

“To attract a more stable labor force, it is important to work toward providing more affordable and appropriately-sized housing opportunities,” according to the document.

“Consequently, the town will largely target its affordable housing efforts on the development of affordable rental options for younger households and the increasing number of older, long-term residents with fixed incomes. The town recognizes, however, that homeownership opportunities for the first-time purchasers and low- to moderate-income empty nesters should also be part of its housing agenda.”

There are significant development challenges for Harwich, according to the plan. The town’s resources for absorbing growth are limited given significant physical constraints, including the considerable extent of the town’s preserved open and recreational spaces as well as sensitive environment. The town lacks sewer services in most areas at this point, and a few areas are still without municipal water, making denser development more costly and difficult.

“The town needs to continue to promote more affordable development by effectively managing the town’s limited assets as a whole and directing growth for the overall environmental and local health of the community,” the plan reads.

Among the strategies provided to meet the housing needs of the community are continuing to engage the community in discussion on affordable housing. Issues such as myths, and negative stereotypes need to be addressed, and political and financial support are necessary to increase housing units.

Greater flexibility will also be needed in the town’s zoning bylaws, and new tools will be required to capture more affordable units and better guide development. Recommendations include considering density bonuses, allowing more multi-family dwelling types, adopting inclusionary zoning, promoting affordable housing mixed-use developments, modifying the accessory apartment bylaw and adding a motel conversion bylaw.

“We need to get more creative with affordable housing,” said Select Board Chair Julie Kavanagh.

Sunnarborg said public forums were conducted during the development of the draft and one more such gathering would be held for the presentation of the final plan. Select Board member Donald Howell said before that public forum, he would like to have a stakeholders session, bringing the affordable housing trust, housing committee, planning board, local planning committee and other town groups together to shape an orderly process.

“That would be terrific,” Sunnarborg said, adding that she expects to have the draft completed in about a month and would like to have the final forum in late spring or early summer.