Panel: Pandemic Has Deepened Cape’s Existing Social Problems

By: Alan Pollock

Topics: Education , Housing and homelessness , Economic development , COVID-19

The summer of 2020 might appear fairly normal, but some changes from COVID-19 will likely be permanent, experts predict.   FILE PHOTO

When it comes to housing, child care, hunger and the wealth gap, COVID-19 has exposed and worsened existing problems on Cape Cod. That was the conclusion of a panel of experts who met in a virtual “State of Cape Cod” session last week.

From an economic standpoint, things may not seem too different this summer, but looks can be deceiving, Cape Cod Chamber of Commerce Executive Director Wendy Northcross said. The running average of hotel occupancy is down about 31 percent, she noted. “With that said, we are leading the state in occupancy for hotel stays.” But tourism is just one part of the region’s diverse economy, which are also led by health care and construction. A Cape Cod Commission survey of businesses in April showed “a pretty devastating impact from the pandemic,” Northcross said.

Before May 15, there were massive declines in real estate activity, with sales essentially halting, said Ryan Castle of the Cape and Islands Association of Realtors. But after that date, the region saw “an explosion in the real estate market. When I say this, it’s unprecedented what we’re seeing on Cape Cod.” More people are buying more expensive homes, and “buyers are much more willing to buy in this environment than sellers are willing to sell.” The shrinking inventory and increased demand has driven up prices considerably, and some properties are selling now that have been on the market for four or five years, Castle said.

The pandemic has underscored the existing shortage of affordable housing, said Alisa Magnotta of the Housing Assistance Corporation. “We quickly saw that the ability to shelter in place is a privilege, and many of us aren’t able to do that,” she said. In a survey of renters, 45 percent indicated that they essentially have no savings to fall back on. “They don’t have the wherewithal to ride this storm out,” she said. HAC has seen a 400 percent increase in the number of calls for rental assistance, and expects that number to surge once the state-imposed moratorium on evictions expires on Oct. 17.
Reopening the economy will ease that financial stress, but concerns about a resurgence of COVID-19 have a chilling effect on local businesses. An even more pressing problem is a lack of child care, Northcross said.

“The employers have said, ‘My staff can’t come back because they don’t have adequate child care,’” she said. The Cape Cod Reopening Task Force has a group working on the problem, but the challenges are many. It’s not just lower-income workers who are struggling with child care, Castle said.

“There are people of means who can’t even find child care providers,” he said.

It is clear that many of the new home buyers on Cape Cod are people between the ages of 35 and 50 who have children, and converting them to year-round residents will help support more year-round businesses, Castle said. But because many of these people are coming to the Cape from urban centers and working from home, earning relatively high wages, it has the potential to widen the wealth gap, “since our incomes are so much lower than other places,” he said.

There are various pieces of legislation designed to ease the housing shortage, “but the affordability gap is still very present and very real,” Magnotta said. Not often mentioned is the plight of landlords, small businesspeople who can’t pay their mortgages if they aren’t collecting rent. This could bring about a foreclosure crisis, or might just prompt landlords to “get out and just sell it into a hot market,” she said. “It could actually displace somebody who’s currently living and working on Cape Cod.” A survey of landlords shows that 40 percent say their tenants are behind on rent, though 75 percent are willing to work out a payment plan for them.

“Landlords don’t want to evict,” Castle said. The moratorium on evictions is a short-term fix, but rental assistance programs like the one recently approved in Chatham will be invaluable. “That’s the long-germ goal,” he said.

Forum moderator Matt Pitta asked the panelists to predict how the Cape will be different in a post-COVID-19 world.

Kara Galvin of the Cape and Islands Workforce Board said local high schools and vocational schools are working hard to ensure that graduates are ready for careers that will allow them to be self-sufficient. She predicted growth in the healthcare and information technology sectors. “It’s going to be very exciting over the next couple of years,” she said.

Eventually, the real estate market will cool as demand levels off, Castle predicted. But the new residents will have more discretionary income, creating new opportunities for local businesses. Already, retailers and restaurant owners have shown ingenuity in adapting to the pandemic, and they’ll find unique ways to adapt to the future economy, he said. “We could see some really great things on the Cape,” Castle said.

“We’ve just taken a 10-year leap into the future” toward a more year-round economy, Northcross said. More people will be working remotely, “with more people making money in much more diverse ways.” The Cape still offers a high quality of life, and Cape Codders will find ways to adapt to the new economy. “Will there be pain? Of course. Will there be businesses that don’t survive? Of course. But maybe some of that creates new opportunity.”