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Cape Cod Businesses Expected To Suffer Due To Housing Shortage

The lack of affordable housing on Cape Cod, Martha's Vineyard and Nantucket exacerbated an already-dire year during the pandemic, forces island fire departments to rely on firefighters who commute by ferry, and will lead to scaled-back business services in the upcoming tourist season, local officials and experts said Thursday.

Massachusetts for years has been grappling with a strained housing market featuring limited supply, sluggish production of new units, and skyrocketing prices. The COVID-19 crisis deepened the problems, prompting elected officials and experts from the area to call for additional action at the state and local level to get more development approved and generate more revenue for housing subsidies.

Wendy Northcross, CEO of the Cape Cod Chamber of Commerce, cautioned that the effects are spilling out onto employers. While there are many reasons behind current workforce shortages, Northcross said the lack of housing — rather than the boosts from pandemic-era unemployment and stimulus checks or challenges finding child care — is "crushing our small businesses."

"All of us on Cape Cod, whether we are visiting or living here, are going to see the impacts of our housing crisis," Northcross told reporters during a conference call focused on housing availability. "You are going to find your favorite bakery no longer serves a meal. They can only serve what they baked. You're going to find that the veterinarian can no longer take a last-minute appointment. You're going to have to wait to get in the queue to take care of your doctor's appointments."

"You're going to find that the services are just not at the level that you've come to know and appreciate on Cape Cod because there aren't enough people to work," she added.

The housing crisis has been fermenting for years, but it became more potent in the past year-plus as the COVID-19 pandemic thrust economic and health disparities into the spotlight and as buyers flocked to the market.

For two straight months, the median single-family home sale price in Massachusetts has surpassed half a million dollars, according to the Warren Group. The mean single-family home sale price is up 23.5 percent year-over-year, while the median condo sale price increased 20.8 percent year-over-year.

In Barnstable County, the median individual property sale in May increased 30 percent compared to May 2020, according to figures presented during Thursday's housing-focused call.

Tucker Holland, Nantucket's municipal housing director, said only eight of the 117 single-family homes up for sale on the island as of Thursday morning were listed at a price of $1 million or less.

"I don't think I need to convince anyone that we have a severe challenge here," Holland said. "We have five of our full-time firefighters who do not reside on Nantucket and commute. Our fire chief is nervous that he's going to lose three of those in the near term, and it's fairly obvious that, 30 miles out to sea, mutual aid is not an option."

Amid the pandemic's upheaval, the Cape's Homeless Prevention Council has seen a flurry of inquiries in the services it offers, according to Hadley Luddy, the organization's CEO. On the lower and outer Cape, she said, housing has gone from "virtually unaffordable" in recent years to "basically impossible" to find.

"The clients we see at HPC are at a level never seen before and include seniors on fixed incomes, working parents making decent living, and locally employed professionals," Luddy said. "We'll get calls from people on a daily basis saying, 'My rental's been sold and I have to be out in 30 days. Where can I go, and how can you help me?'"

Sen. Julian Cyr said that even on the salary and committee stipends he earns from the Senate — which totaled $142,081 in 2020, according to public state payroll records — he and his peers fear that they "will be pushed out when our existing landlord decides to sell or passes away or there's a change of ownership."

"We need to ratchet up what we're willing to do on Cape Cod, on Martha's Vineyard and on Nantucket," Cyr said. "That means additional and aggressive development of affordable housing to meet the demand."

Gov. Charlie Baker on Thursday unveiled a massive new proposal to direct about $1 billion in American Rescue Plan Act funding toward housing as part of his push to work with the Legislature to allocate roughly $2.8 billion in funds now and leave the remainder in the roughly $5.2 billion pot to be appropriated later.

Under Baker's plan, the state would spend $300 million on helping first-time homebuyers in disproportionately impacted municipalities and $200 million to support production of housing through the CommonWealth Builder Program that promotes home ownership in communities of color. He also suggested spending $300 million to produce more senior and veteran housing and $200 million for additional rental housing production focused in particular on communities hit hard during the pandemic.

Baker pushed for years to lower the level of local support needed for zoning changes, arguing that it would help much-needed housing construction projects advance and kickstart development of new units. In January, Baker signed an economic development bill that included his so-called "housing choice" provision reducing the local voting threshold required for a zoning change from a two-thirds majority to a simple majority, a change that administration officials hope will substantially boost housing production.

So far, the Executive Office of Housing and Economic Development (EOHED) has tracked just one housing-related zoning vote that was successful under the updated margins.

The Salem City Council in April approved an ordinance allowing accessory dwelling units in several zoning districts by a 7-4 vote, a margin that would have failed before implementation of the new law, according to EOHED. The Baker administration also pointed to zoning changes approved in recent months in three other communities — Arlington, Needham and Stoneham — as important steps, but each of those passed with a two-thirds majority or greater.

Asked Thursday about the provision's impact on the Cape and islands, Cyr replied, "I'm not immediately aware of something. There may be one or two projects."

A Cyr aide later said that Nantucket Town Meeting approved two citizen's zoning articles this spring aimed at rezoning to allow increased density with a simple majority, but not two-thirds majority, though "those are being investigated as to whether they should fall under the (housing choice) provisions."

The Truro Democrat said he supports the zoning reforms but stressed that those steps are not enough to address the lack of available housing that poses "a near-existential crisis" for the Cape and islands.

"Housing choice makes a difference, but I think we need to be honest that land use policy in Massachusetts is determined by and large by our municipalities," Cyr said. "Because of zoning, because of the ability for redress and appeal, it means that every single one of these projects is a fight."

Referencing an editorial he wrote last year, Cyr said some housing projects end up sunk or slowed by "a persistent nimbyism where you see a small minority of the community who are hiding behind environmentalism and conservationism."

"Even if you change the zoning, even if you get the project approved at Town Meeting, they're still going to get jammed up and litigated by people who, quite frankly, have a very narrow perspective that they have theirs and they don't want anyone else to have a piece of it," Cyr said.

Cyr said Beacon Hill can play a role in solutions. Nantucket, for example, has on several occasions approved a home-rule petition to impose a fee on real estate transfers and use the revenue for affordable housing, but it never cleared the Legislature.

He stressed, though, that he believes the housing crisis "will be solved or will not be solved based on action taken at the municipal level."

"I'm really pushing the 20 communities that I represent in the Cape and Islands district to commit to a fundamental reimagining of what we are willing to do in order to solve this crisis," Cyr said. "If we don't fundamentally reimagine what we are willing to do on housing, we will not have sustainable year-round communities. This will not be a place that people from all walks of life are able to make their lives."

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