Homes like this $14.5 million property at 97 Tilipi Run St. in Chatham would be subject to a transfer tax under a new proposal to fund workforce housing on the Cape and Islands. Photo courtesy of Robert Paul Properties.

In the midst of vacation rental season, housing officials from Nantucket made the trek to Beacon Hill to join their state senator in a call for new tools, including a real estate transfer tax, help create attainable housing for year-round Cape and islands residents.

“On Cape Cod, Martha’s Vineyard and Nantucket, we face a unique challenge with a seasonal economy and a large second- and third-home owner market,” Sen. Julian Cyr told the Housing Committee Tuesday. “There is extremely limited year-round housing. We are geographically isolated and we’re geographically contained. You can’t build housing on the ocean, particularly with climate disruption.”

Cyr, a Truro Democrat, pitched the committee on a bill he filed to address the housing needs of seasonal communities. The bill (S.789) includes provisions that would allow cities and towns to establish a transfer tax on property sales valued over $2 million, allow accessory dwelling units without a special permit, and allow cities and towns to implement a property tax exemption for low- or moderate-income households.

The bill would also require that tiny homes of no more than 600 square feet be permitted in communities that permit accessory dwelling units, and create a local option that would allow a property tax exemption for units that are occupied year-round and rented on a yearly basis for no more than 150 percent of the fair market rent.

Cyr said the market in his district incentivizes building for and selling to second-home buyers with higher disposable incomes over producing “attainable housing” for year-round residents like teachers, police officers, firefighters and restaurant workers.

The median single-family home sale price in Barnstable County in 2018 was $399,900, according to The Warren Group. As of June 30, that number is $405,000. For Dukes County, those figures are $736,250 and $712,500, respectively, while for Nantucket County, the figures are $1.49 million for both periods.

“All the people who make Cape Cod work and the islands work, particularly this time of year, we don’t have housing for them,” Cyr said.

Nantucket housing specialist Tucker Holland said the state’s housing crisis may be at its most severe on the small island.

“More than one family sharing a basement, separated only by sheets, people sleeping on concrete floors, unrelated folks shift-sleeping, parents and children not all living under one roof are, sadly, commonplace,” he said.

The bill would also direct the Department of Housing and Community Development to give “special consideration” to counting certain otherwise unqualified projects as part of a municipality’s subsidized housing inventory. Those projects include one-bedroom units in communities that can demonstrate a need for low-income housing that size; projects in municipalities where the average home price is 100 percent greater than the statewide median; and Nantucket covenant housing.

Under Housing Nantucket’s Covenant Program, a property owner is able to subdivide their lot, as long as they put a permanent affordability restriction on the deed and sell to an income-qualified, year-round resident. The maximum sale price under the program for 2019 is $775,973, and buyers must earn below $172,350 per year, according to the Housing Nantucket website.

Housing Nantucket executive director Anne Kuszpa said Cyr’s bill contains “a lot of great tools” for communities like hers. She said two-thirds of the island’s housing is occupied seasonally, and that a location 30 miles out to sea makes it impractical for many people who work on Nantucket to commute from elsewhere.

“There’s an urgent demand for affordable housing at all income levels,” Kuszpa said.

Separately on Tuesday, Lt. Gov. Karyn Polito joined state housing officials to tour affordable housing developments in Yarmouth and Falmouth.

“We need more workforce housing like these 69 new units in South Yarmouth especially on Cape Cod where housing costs are high & out of reach for many working individuals & families,” Polito wrote on Twitter.

In addition to meetings at the Pentagon on yesterday, Gov. Charlie Baker was scheduled too sit down with officials from the U.S. Department of Transportation and the U.S. Army Corps of Engineers to discuss the two bridges that carry tens of thousands of tourists and residents onto Cape Cod every day.

The Massachusetts Department of Transportation released its Cape Cod Canal transportation study earlier this year that recommended replacing the Bourne and Sagamore Bridges, both of which are 84 years old and have outlived their lifespan. That project would cost an estimated $1 billion, and requires federal support. MassDOT is also exploring the possibility of a reconfiguration of ramps and rotaries leading to the bridges to ease traffic congestion.

Cape Officials Plead for Real Estate Tax to Help Build Housing

by State House News Service time to read: 3 min