City may need to build as few as 3,100 more apartments for affordability goal
The city may need to build fewer housing units than many have been thinking.
On paper, anyway, Cambridge needs to put up between 3,100 and 6,200 more units of housing during the years that started in 2010 and end in 2030, according to Holly St. Clair, director of data services for the Metropolitan Area Planning Council.
The figure was produced Wednesday in a blog post by city councillor Dennis Carlone, who said he saw that “many residents are asking the question: How much housing does Cambridge need by the year 2030?”
In explaining the figures he was passing on, Carlone continued:
While the MAPC analysis calls for up to 6,200 new units in Cambridge by 2030, it’s also worth pointing out that in just the past year, some 2,450 units of new housing were either completed or in construction across the city, according to the Community Development Department’s 2014 Year In Review. Taken together, these numbers indicate that Cambridge is making real progress toward MAPC’s 2030 goal.
A Better Cambridge figures
In late February, the “smart growth” group A Better Cambridge said projections by the council showed a need for 400,000-plus more housing units to meet demand for housing in Greater Boston, with Cambridge’s contribution being 8,500 units.
The figure drew immediate questioning from growth skeptics who wanted to know its source. “ABC provides no link, either here or on their website’s version of this letter, to the MAPC report with those Cambridge numbers it refers to. Several people have looked for it with no success,” resident Mark Jaquith wrote in reply.
After Carlone’s post, the Cambridge group’s Jesse Kanson-Benanav sent a correction acknowledging the lower figures as accurate and explaining that “our number was derived by subtracting the existing number of occupied units in Cambridge according to the 2012 American Community Survey from MAPC’s projection for the number of units Cambridge needs under a ‘strong region.’”
Still room for debate
Under that scenario, the council has sketched out goals that “will not only help ensure that every household in the region can afford a home, but will also help the region maintain a robust and growing workforce that forms the backbone of a competitive economy. “
There is still room for debate as the city heads into creating a master plan that could reshape Cambridge for decades, with a key issue being how the city can guarantee affordable rents and sales that stop squeezing out middle-class earners and families.
After a Planning Board and City Council housing roundtable asked in December how many more units would accomplish that, Northeastern economics professor and Cambridge resident Barry Bluestone said it could take as few as 600 vacant rental units – although substantially more would have be built to get to the point where at any given time the city had 600 vacant units. Bluestone generally targets a rental vacancy rate of about 5 percent “to keep rents from rising faster than inflation,” and said Cambridge’s rate, according to the U.S. Census Bureau, is about 3 percent (or a five-year estimate of 2.2 percent for 2008-12). Bluestone said that below 3 percent vacancy, rents rise very rapidly.
In 2012, Stuart Dash, director of community planning with the city’s Community Development Department, acknowledged the city had already been in a growth spurt, without seeing much effect.
“Recently it’s been relatively inelastic in term of the economics,” Dash said. “Usually the elasticity of supply and demand is that if supply goes up, then price comes down. In recent years it’s not seemed to be that way. It doesn’t mean it will stay that way forever or that increasing supply at a certain point won’t push down prices. If you look at it over a long number of years you’ll see dips and ups and downs based on supply and demand.”
Saul Tannenbaum, a Cambridgeport resident and CCTV blogger who is on A Better Cambridge’s leadership committee, felt Bluestone would have more-informed insights. In 2013, Bluestone was asked to weigh in on Dash’s analysis.
A good test
Bluestone was asked at what point supply started affecting demand and stabilizing or even lowering prices, and how much housing stock must be added in Cambridge to achieve better, practical results for less-rich renters and buyers. A concern expressed to Bluestone was that with only a little more than six square miles in which to build, Cambridge might be altered so dramatically by denser, towering housing that what residents loved about the city would be lost.
Bluestone replied in August 2013:
I think we are going to have a good test of rental prices in Cambridge in the next year or two. Finally, there has been an substantial increase in housing permits and we will see if new construction begins to moderate rents relative to past years and possibly relative to other communities. The problem is that the demand for Cambridge housing keeps rising because of Harvard and MIT and the explosion in the bioscience firms. What I hope we will see is that younger folks move into some of this new housing and vacate some of the older stock in the city. If that happens, landlords will have less leeway to raise rents. I do not expect rents to fall, but I would hope to see rent increases moderate.
The test period identified informally by Bluestone ends in August.
John Hawkinson contributed to this report.