Affordable housing construction under the state’s anti-snob zoning law was cited as a reason for the rise in the number of permits issued during the first half of the year. This is a home in Woodland Green, a Norton development that is being built with a comprehensive permit issued under the Chapter 40B statute. Canton-based CAN-FOUR is the developer.
It may be an encouraging sign that the number of housing permits issued during the first half of the year are up, but Bay State homebuilders are far from celebrating.
Some 7,707 building permits were issued for single-family homes from January through July of this year, a 3.5 percent increase from the 7,444 permits issued during the same months last year. The number of permits issued for multi-unit properties during the same period was up even more. Multi-unit permits jumped 9.3 percent, from 2,430 to 2,657.
The slight increase in single-family permits is being viewed as a mere “blip” by some homebuilders who say that unseasonably warm weather early in the year and more affordable housing construction under the state’s anti-snob zoning law, Chapter 40B, may have led to the small climb. But according to builders, the increase was insignificant considering there has been a 20 percent drop in the number of permits issued in the last three years.
“The increase was negligible as far as I can tell,” said Gary H. Ruping, president of Ruping Builders Inc. in Billerica.
“Even with the slight increase, we’re still down 18 percent from where we were in 1998, which is proof positive that communities have been significantly cutting back on permitting,” said Mark H. Leff, a senior vice president in charge of construction lending at Salem Five Cents Savings Bank.
Leff and real estate developers like Ruping have been trying to spread the message during the last several years that communities’ efforts to restrict housing development through building caps and strict regulations have led to an affordable housing crisis. The barriers to housing development are also challenging the state’s businesses, which have trouble recruiting and retaining employees because of the region’s high housing costs.
Homebuilders interviewed by Banker & Tradesman last week said that message seems to have been heard by the state’s political leaders. But they maintain that it hasn’t filtered down to local officials, who worry that housing development is taxing their community services, especially schools.
“I don’t think it’s hit home yet,” said Medfield builder Scott Colwell.
Ruping said some communities he’s worked in, including Burlington, Woburn and Bedford, have made substantial efforts to produce more housing, particularly affordable units.
“But there are still other towns that prefer to stick their heads in the sand,” said Ruping.
The number of single-family housing permits that Bay State communities have issued has continually gone down since 1998, according to statistics posted on the U.S. Census Bureau Web site. Last year, 13,030 single-family permits were issued statewide, a 20 percent decrease from the 16,303 permits issued in 1998. On the other hand, permits issued for multi-unit properties during the same timeframe climbed nearly 6 percent from 3,923 in 1998 to 4,156 in 2001.
The rise in the number of permits issued the first half of the year might have to do more with the weather than anything else, according to builders. Builders who didn’t expect to have projects completed until spring could have started pulling permits earlier because of the mild weather last fall and early this winter.
The jump in multi-unit permits was also attributed to the increased development of age-restricted housing and affordable housing under the state’s anti-snob zoning law. Many of those projects feature attached townhouses or garden-style units that require multi-unit permitting.
‘Worse Than Ever’
Homebuilders in Massachusetts have complained that communities are taking excessive measures to restrict housing construction. More than 60 communities have passed some type of building caps within the last several years, and other towns and cities have adopted higher permitting fees and stricter building regulations.
In addition, developers whose original housing proposals have been rejected often find themselves spending thousands of dollars in legal fees to file appeals and fight for their rights to develop land they own. Builders contend that the lengthy and expensive permitting process forces them to pass on the costs to homebuyers in the form of higher home prices.
“The fact of the matter is we’re having trouble finding land that is appropriate to develop and we’re having difficulty putting the land through the permitting process,” said Ruping.
Leff said that the number of conventional subdivision projects is “down significantly.” “Some of that is being made up with special permits for age-restricted projects,” he said.
Communities have become more receptive to housing geared for people 55 and older because those type of projects typically don’t add more children to school systems, according to some real estate experts.
In addition to age-restricted housing, builders who are having a tough time getting their proposals approved are seeking comprehensive permits under the state’s Chapter 40B law. Chapter 40B, the state’s anti-snob zoning law, allows developers to practically bypass local zoning rules to build housing in communities where less than 10 percent of the housing stock is deemed affordable. Under the law, however, builders must sell 25 percent of the housing units they propose to build at lower prices.
“I think that absent 40B the local restrictions and regulations on housing development are worse than ever,” said Leff, who is legislative chairman of the Home Builders Association of Massachusetts.
“It’s just about impossible to develop under conventional zoning,” said Colwell, a trustee with Hoover Realty Trust.
Colwell is currently building the second phase of a 40-home subdivision in Medfield. Prices for the homes range from $1.1 million to $1.4 million. He is also finishing a 40-home development in Norfolk and starting construction on 25 homes with prices from $750,000 to $1 million.
However, Colwell said Medfield and Norfolk are no different from other bedroom communities outside of the Route 128 belt that are focusing on land and open space preservation and rejecting housing.
“I certainly don’t see a big increase or influx in building in this area,” he said.
Colwell predicts that the number of permits being issued will continue to drop. If anything keeps the permit numbers up, according to Colwell, it will be the comprehensive permits that many developers are seeking under Chapter 40B in communities that don’t meet the 10 percent threshold for affordable housing.
But the comprehensive permitting process has come under attack. Last year, suburban communities tried to convince state leaders to drastically change Chapter 40B. Town leaders argue that developers abuse the law to build large housing development that ruin the “character” of their communities and overburdening their local services.
“Once they [state leaders] change it [Chapter 40B], there won’t be any building in this state,” said Colwell.
Some builders believe that the homebuilding industry needs to do a better job of educating communities about affordable housing development under Chapter 40B. Judy Jenkins, vice president of CAN-FOUR in Canton, said towns often have misconceptions about affordable housing and how new housing will affect their school systems.
CAN-FOUR received a comprehensive permit to build Woodland Green, 44 homes in Norton. Twelve of the homes will be sold at below-market rate prices. Of the thirty-two market rate homes, 22 are under agreement, said Jenkins. Buyers include single women and men, a family that is downsizing and some young families.
Contrary to what Norton officials would have predicted earlier on, only four children will actually live in all of the 22 homes under agreement, according to Jenkins.
“Most people in Norton would have predicted that every house would have two children, and the impact would have been felt at the schools,” said Jenkins. “It’s not going to have a big impact with four children.”
“We have to do a better job as an industry of getting a true picture of what these affordable communities look like and a true picture of the impact they will have,” said Jenkins.
