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Affordable housing — how did we get here?

Truro Motor Inn problem highlights issue, exacerbated by Airbnb-type rentals

By Katie Landeck

Provincetown Banner

The affordable housing problem on the Cape is, at its core, a math problem.

The average rental rate for a two-bedroom Airbnb unit in Provincetown area is $254 a night, meaning if a property owner can fill their unit every night of the 20-week season from May through September, they’re looking at a payout of more than $34,000.

If they rent that same property out for $1,300 a month, they make less than half that amount, or $15,600 a year.

That’s what the University of Massachusetts Dartmouth Public Policy Center found in a November 2018 report detailing the acceleration of Provincetown’s affordable housing problems over the last decade, using data through last year.

“It’s the elephant in the room,” said Carl Brotman, the vice-chairman of the Truro Housing Authority, who has been working on the issue for years. “In a month, you can earn almost a year of rent money.

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Not many people are going to opt for (year-round rentals) unless they are feeling philanthropic.”

The report, and others that have come out within the past year, have defined a problem that many are already aware of, giving housing officials a document to point to as they look for solutions, such as cooperative efforts between local government, the state, and the developer to add housing. New construction is the biggest push right now to chip away at the problem, a problem many describe as a crisis.

While the problem is Cape-wide, nowhere is the problem so stark as on the Outer Cape, where shortterm rentals far exceed the stock of year-round housing. In Truro, for example, state data shows that 72% of the housing stock is either short-term rentals or second homes.

The result — everyone struggles to find a place to live.

Service workers are the first to be priced out, but it’s not just them. Fire chiefs have reported difficulty hiring, citing housing as a primary reason. Brotman said he’s heard even the hospital is having trouble recruiting doctors because of the high cost in the housing market, for buyers and renters.

“The need has gotten greater as the availability of housing has decreased,” said Laura Shufelt, a community assistance expert with the Massachusetts Housing Partnership.

Shufelt grew up on the Cape. Since she was a child, she’s watched as more and more family homes and rental units were converted into second homes and short-term rentals. Then, during the recession, a tipping point happened, she said.

“That’s when the percentage of second homes shot up. They were all secondhome buyers,” Schufelt said.

During this time, the cost of a house on the Cape was dropping, she said, and these people, who had disposable income, were able to swoop in and buy the retirement house on the Cape they always dreamed of, or have their own investment properties.

Meanwhile, “the percentage of year-round homebuyers was in the negatives. It was below the breakeven line because people were losing their homes.”

An availability issue was created, with one study estimating Cape Cod is short 4,500 to 5,000 rentals units compared to the need.

The lack of affordable living places has been on full display during the ongoing conflict between the town of Truro and Truro Motor Inn, where year-round renters are pleading with the town to be lenient with ownership, despite ongoing safety violations the town says have put them at risk.

As one Inn resident, Amy Paine, told the Truro Board of Health at its Oct. 3 meeting, “I’m just saying that if you people pull this license, there will be a lot of homeless people. …There is no place for us to go. There just isn’t.”

Because when there is an availability issue, per the rules of supply and demand, there is an affordability issue.

As it stands today, 43 percent of renters in Provincetown are considered “severely cost-burdened,” according to the Center for Housing Data, meaning more than 50 percent of their household income goes toward rent. Another 20 percent is considered “cost-burdened” meaning more than 30 percent of their household income goes toward rent. The picture is similar in Wellfleet, and other Cape communities.

And those numbers don’t take into account the people who couldn’t find a place to live. More than a quarter of the Cape’s year-round workforce don’t actually live on the Cape, according to Housing Assistance Corporation, primarily because of availability and affordability. Because of that, Brotman sees the long-term future of the Cape in jeopardy.

“We lose our feeling of community,” he said. “It gets harder and harder to hold people together.”

The future of the schools, with fewer students to fill the classrooms, is becoming less and less certain, he said. With fewer people between the ages of 20 and 45, a demographic he described as “gutted,” there are fewer entrepreneurs to push the economy forward. Businesses, in general, will have a harder time staying staffed.

“The federal reserve did a huge study across the country on what happens when a town becomes unaffordable when the rise in housing cost doesn’t coordinate with the rise in local income. What they found is when unaffordability goes up, the economy in broad strokes goes down,” Brotman said. “The thought that the Cape will always be the Cape (a tourist destination) is untrue.”

Schufelt said she sees more and more business leaders calling this out as a problem, and more political will to get something done. Her job is to help make it happen, helping to connect the state and the town on housing projects, which are then turned over to private developers. Brotman works on it from the town end.

The focus tends to be on adding more housing, rather than convincing landlords to switch to the less lucrative year-round rentals, though there are tax abatement programs for those who are willing.

Brotman has seen some success with building. The Sally Way’s project in Truro — a 10-year project — brought 16 units online. There was also a Habitat for Humanity project in Truro. But he’s also seen how hard it can be to work a system — even a system that’s trying to help — and win over skeptical neighbors. There was another Habitat for Humanity project, for example, that got caught up in litigation.

There’s currently another effort for a 40-unit project built on land in Truro that has been donated by the state, Brotman said. It’s years away, but he’s hopeful.

“We just keep chipping away at the number,” he said.

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