▪ Tax incentives for affordable development
The city could offer a 10-year real estate tax rebate for middle-class housing development, as New York has done for decades with its 421a new housing program. The units would have to be within a certain affordability range in relation to the median income of the area and could have a significant impact on stimulating new construction in areas that previously focused exclusively on higher-priced development.
▪ Conversion of cellar units
Boston could almost immediately create 8,000 apartments in older, cheaper buildings across the city if basement extensions were easier from a zoning perspective. The city has lifted the restrictions on the construction of basement rooms, but must also relax the zoning and deviation barriers that make the conversion of basement rooms a time-consuming and complicated process. There are few policy changes that could generate more units faster and more cheaply than this.
▪ Trade union cooperation
Some unions, such as the Carpenters, offer reduced housing prices for timber frame projects outside the city center. If there could be a collaborative arrangement whereby all unions could provide cheap wages to medium-sized projects, it could increase workers’ housing production at a time when building materials are escalating and production costs are deterring a new supply.
▪ Re-evaluate affordable housing needs in luxury buildings
When a luxury home developer is asked to offer up to 18 percent of their units as affordable, there is an economic cost that could be better spread across mid-market home production. The same goes for affordable luxury condominium requirements, with a select few actually participating in the housing lottery. If developers have the ability to make sizeable cash payments rather than giving home profits to a limited number of people, they could fund new projects that will benefit more people.
▪ Optimize the approval process
The current permitting process in Boston is so cumbersome that it gives housing developers an incentive to focus their efforts elsewhere. Building in Watertown, for example, is dramatically easier than building in Brighton, but the two are geographically linked. The city needs to reassess how buildings are approved to encourage, not discourage, the creation of a new, affordable proposition.
▪ Create a master plan for each neighborhood
Cities and towns in the Boston area have master plans that add predictability to the development process. In Boston, any development is a negotiation that poses a significant hurdle for developers to purchase land for development. If the city created a comprehensive master plan zoning each individual parcel, it could better determine what our city will look like in the future, better choreograph the mix between different property types, streamline the development process and stimulate the production of affordable housing.
▪ Accelerate the sale of surplus city properties
The city of Boston has approximately 1,000 surplus homes, much of which is in areas that have not yet been developed. The city should be running an aggressive disposition plan to sell vacant lots for a small fee in exchange for creating medium-sized / affordable housing.
▪ Redirecting payments to limit the community community
For some large new builds, there is a process in place that requires developers to make abatement payments to the neighborhood to compensate for the presumed effects of increased traffic, more competition for street parking, and more density. If these payments were used specifically for a fund to create affordable housing in these neighborhoods, the money could be better used on solving bigger problems rather than on less effective ways.
▪ Expand the Additional Housing Units program
The city has launched a program that is intended to enable owner-occupiers to build additional residential units, so-called in-laws, in order to increase the supply of housing. These units can be inexpensively manufactured within underutilized lots and existing structures, but require complex zoning and construction skills. The city should expand the ADU program beyond owner-occupied housing so that investors who are better positioned for major construction projects can also participate.
Teachers, firefighters, nurses, and other key workers make Boston work, but many find it financially impossible to live here. The lack of adequate housing for the people who make up the backbone of the city is a problem that affects us all. City guides and the development community should work together and get creative to find ways to encourage the production of affordable housing. The good news is that there are solutions, but they require everyone involved to think outside the box.
Bruce A. Percelay is the chairman of the Mount Vernon Company, a Boston-based housing construction company.