Boston wants to turn more market-priced apartments into affordable housing

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The city of Boston plans to expand a program that helps investors convert existing apartments into low-income housing as part of a $ 26 million housing investment announced by Mayor Marty Walsh last week.

The acquisition opportunities program, which was piloted in 2016, aims to “protect the city’s rental housing stock from market forces,” according to program documents, by helping non-profit groups. lucrative and other buyers to buy apartments at market prices when they agree to rent the units at affordable rates. City grants of up to $ 75,000 per unit help affordable housing providers compete with private investors for properties. To participate in the program, buyers must agree to honor existing rentals, reserve at least 40 percent of units for low and moderate income families, and maintain affordability levels for at least 50 years.

So far, the Acquisition Opportunities program has primarily been used by neighborhood nonprofits that purchase small apartment buildings, according to Sheila Dillon, chief housing officer and director of neighborhood development.

“It absolutely worked,” says Dillon. “What we need to do now is scale it up. “

The current focus of the acquisition opportunities program is to turn 1,000 apartments into low-income units, Dillon says. With an additional $ 5 million in funding for the expansion, the city plans to meet with larger nonprofit developers to discuss new acquisitions.

“There are a whole bunch of gains when you take an existing, privately owned apartment building and convert it to a long-term affordable building,” says Joe Kriesberg, president of the Massachusetts Association of Community Development Corporations. .

But, he warned, it’s hard to get by. Nonprofits and the like can only tackle properties that are for sale and reasonably priced, to begin with. On top of that, they have to compete with cash buyers who may not care about affordability, and properties may have tenants who are not eligible for income. Still, efforts like the Acquisition Opportunities Program are crucial in slowing the rate of displacement in cities with housing markets as expensive as Boston, Kriesberg says. He suggests that the program could be more successful if the city increased the grant per unit to $ 125,000.

Boston Tenant Coalition lead organizer Kadineyse Paz also praised the acquisition opportunities program.

“This plays a key role in ensuring that units are withdrawn from the private market and made affordable at all times, preserving housing that could potentially be converted into luxury housing or condominiums, or whatever the circumstances,” said said Paz.

According to a report released last fall, Boston currently has more than 54,000 low-income housing units across the city, two-thirds of which are affordable to renters earning less than half of the area’s median income. As part of Boston’s Housing a Changing City plan, the city has set a goal of adding 16,000 new low-income units by 2030, bringing the total to 70,000. The city defines a “new unit. Affordable housing such as new construction or acquisition and conversion at market rate, explains Dillon.

Much of the Housing a Changing City plan’s new home production targets (69,000 new units in total) are aimed at middle-income residents.

Paz says housing at this level is important, but the need is greatest in low-income communities. As in most cities, the median income in the Boston area incorporates the wealthiest communities outside the city limits, notes Paz, which inflates rates of “affordability” beyond what many. Boston families, especially families of color, can actually afford it.

“Having truly affordable housing is what the city of Boston really needs right now,” Paz says. “The idea of ​​financing housing for middle-income people is interesting, but it doesn’t really target the people who need it most. “

According to Dillon, the city’s Inclusive Development Policy, which was updated in 2015, has produced around 2,500 middle-income homes to date. The policy requires builders of large multi-family projects to reserve 13% of units for middle-income residents if units are built on-site, or 18% of units if built off-site. In some cases, the city accepts payment instead of the developers who actually build the limited income units. The program has worked well in Boston because it’s mandatory and because the housing market is so strong, says Dillon.

Along with the expansion of the Acquisition Opportunities Program, the city announced funding for ten affordable housing projects in seven neighborhoods that will create or preserve 515 housing units. Community development corporations and other groups applied for funding in a request for proposals released last fall. Funding for the projects comes from a variety of sources, including bonding fees paid by developers of large commercial projects and a 1% land surcharge collected through the Community Preservation Act.

Funding announced last week will be split between mixed-income projects with some low-income units serving seniors and homeless people. One project, in Roxbury, will consist of nearly 200 units, including 48 units reserved for people earning up to 50% of the MAI.

“What we’re trying to do is take our different sources of money, put them in our development and preservation budget, and then go out and tender so the developers don’t have to run. from source to source, ”explains Dillon.

Jared Brey is the Housing Correspondent for Next City, based in Philadelphia. He is a former editor of Philadelphia Magazine and PlanPhilly, and his work has appeared in Columbia Journalism Review, Landscape Architecture Magazine, US News & World Report, Philadelphia Weekly, and other publications.

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