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Downtown housing proposed for people who don't work in finance and aren't Saudi princelings
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This looks very promising.
This looks very promising. Kudos to Related Beal. Mr. Beal has always been a gentleman and motivated by not just bottom-line profits so not surprised this is coming from him. Hope it works out.
Good start....
I read the article and I think it's a good start. It will have a mix of apartment sizes, including 1-bedrooms, 2-bedrooms and also 3-bedrooms for families. This particular building might not be a perfect fit for some families, but it's a start, and good to see. I hope it attracts a lot of people and creates a good mini-community within the building. Hopefully the building's design provides some common space and good connections to the rest of the neighborhood so it feels like a community and not an isolated high rise.
In terms of community -- I think that the grossly inflated rents found around Boston ($5600 for a 3 bedroom in some neighborhoods!!?) not only price people out, but also bring in people who behave badly toward the neighborhood -- a sense of "entitlement" and a lack of caring for neighbors or community. The city desperately needs more "normally priced" housing.
Yes...
So surprising you can't house and raise a family of 3 in the heart of a major city....can you do that in NYC? Chicago? San Francisco? DC?
Downtown or Neighborhoods
That would be a valid point -- downtown areas in major cities are often naturally super-expensive -- but in Boston so many of the neighborhoods that would be accessible to families are so over-priced that looking at downtown housing is one of many potential solutions.
Wasted tax dollars though?
I think we'd still be better off building more buildings for Saudi princelings in the area which can best support it (downtown, urban core) and then try make family accessible housing by continuing to build out places like Roslidane, Hyde Park, Dorchester, Roxbury, etc... where there just isn't the density.
We'll probably never see a $1m condo in Roslindale, but you can build a building with 10+ units where the units are more affordable. So by putting in the cheaper housing where more expensive housing could be supported, we're throwing away money in a way. It's an opportunity cost problem. The City has long term financial pressures in the form of retirement benefits to the unions and we should plan accordingly as those will not be reduced in any way I think.
Define your terms...
People keep using the term "over-priced." I don't think it means what they think it means.
Over Priced = 3x
In this country ALL real estate, regardless of location, has been inflated to approximately 3 times it's value [based on natural price progression and inflation]. This was the cause of the 2001 [c.] housing bubble. And it occurred, for the most part, to all of the country, to all forms of housing, and to all economic levels. It doesn't matter if you are looking at a luxury condo in Manhattan, a three decker in Roslindale, a ranch house outside of Milwaukee, or a burned out shell in south Philadelphia. It costs about three times too much.
Not quite
First, you are taking widely varying housing markets and conflating them. I would imagine that house prices in suburban Milwaukee has not grown at the same pace as Midtown Manhattan or San Francisco, and at that, how can you say that housing is three times more expensive than it should be? Where are your figures from, and specifically I want to know about Milwaukee?
Several factors can drive up housing costs. Demand can be higher than supply, which is the case in the Boston metro area, or wages can skyrocket, allowing homebuyers to bid on properties without much thought of the cost, which is the case in Silicon Valley and was the case in Ireland. On the other hand is the situation in Miami, Las Vegas, and Ireland where speculators come in seeing the rise in real estate values and decide to build, build, build, causing a glut in supply, which pops the bubble. That didn't happen in Milwaukee. It's not happening in Roslindale.
In the end, there is only so much real estate, like there is only so much gold and so much oil. Prices go up, prices go down. It's what happens.
While I agree with letting
While I agree with letting the free market decide the prices for most things, its just not sustainable with the luxury condo boom. The main issue is many of these units are not primary residences, and with Boston they are probably 3rd or 4th residences. This results in these buildings being rented/owned but vacant. This keeps out people who would actually reside in downtown and support local businesses in the area more than the 4-5 times a year they visit their vacation condo.
I'm all for letting the value be determined by what people are willing to pay, but I wish there was someway to ensure these are primary residences. Otherwise it just seems like a waste of space to me.
Money for nothing?
On the other hand, we get to charge these people taxes in excess of the services they use in terms of police, infrastructure, fire, schools, etc... I think they are probably an economic winner if not great from an 'urban fabric' perspective.
Money for nothing
... and your chicks for free.
Dire Straits, 1985.
The kind of speculation you
The kind of speculation you're talking about here (where rich people buy million dollar condos but don't actually live in them) is actually a direct result of the housing shortage, not the cause. When cities refuse to build enough housing to meet demand, that causes a shortage, and people will bid against each other for access to the few new homes that do go on the market. This bidding process causes property values to increase so quickly that real estate starts to look like a pretty good investment. Over the last 10 years, if you had invested equal money in stocks and a Boston property, the property would now be worth more than the stocks. It's simple math.
If we want people to stop hoarding housing, we need to make enough of it that it stops being such a great investment.
The Market
Is this public development where they will actively block buyers who make above a set limit?
I don't understand below market rates unless there is a government entity disqualifying people. All someone would need to do is buy an apartment and sell it shortly thereafter to the highest bidder which is the definition of market rate.
The BRA typically handles
The BRA typically handles this in Boston for these kind of developments, and there are rules and restrictions. Obviously it's not ideal and there are winners and losers. And typically current City of Boston residents get first priority. I've never been a fan of that system given how fractured our region is, but it makes some degree of sense.
Here's more info about the BRA process: http://www.bostonredevelopmentauthority.org/housing/currently-marketed-u...
The affordable convenant
The affordable convenant system creates "winners" who are the individuals who win the lottery and buy the affordable units, but everyone else loses.
One of the biggest obscenities of the system is that if an affordable unit has a restricted value of $250,000 while the adjacent market rate units sell for $1,000,000, then the income limit for buyers could be $75,000. If you currently earn $74,999 then good for you, you can win the lottery. If you earn $75,001 then you're totally out of luck. Too rich for the lottery, but not rich enough for market rate. And if you buy the unit and win powerball (or more likely, finish your residency in neurosurgery) the day of closing, then the unit is still yours to keep.
Another obscenity is that the tax assessment for the affordable unit is at the $250,000 rate. So your tax bill is $1000 a year not $10,000 a year. The city loses two thousand bucks on the unit every quarter for 50+ years.
Unless the housing market is monopolized by a few big owners (like the airline industry or telecom) then there's no logic to fighting the free market. If market rate is too high, then the appropriate response is to build denser and taller, not run a social engineering experiment that gives a huge benefit to so few.
It's not quite as evil as that....
I believe the covenants prevent the buyer from reaping a windfall -- isn't there some sort of sliding scheme whereby any profit realized on the sale of the unit has to be returned?
Im not sure if all deeds are
Im not sure if all deeds are the same, but typically the unit must stay 'affordable' for 50 years. When the owner sells, the value is calculated on the purchase price plus 5% increase annually, plus the value of any documented capital improvements, until it reaches market value (The BRA will provide the exact max asking price).
There is no payback of profit to the city, etc. Any profit realized is what should help an affordable buyer have enough of a downpayment available to jump into the mainstream market.
And despite how horrible Refugee makes the affordable tax rate seem, the model makes sense. Everything is based on the artificially deflated price of the unit. So there is the benefit of a lower tax bill (Important when owner doesnt hit a windfall of money immediately after purchase) and lower condo fees (yes, those are based on the value) -- but that also means the owner has a lower voting percentage in the condo than they would for a market rate unit at that price. The savings on taxes and condo fees allows for the owners to not be house poor and (hopefully) save (I like to think that those who subject themselves to -- and can successfully navigate -- the mountains of paperwork and requirements are a little more financially responsible than your average joe.
Of course since that 5%
Of course since that 5% annual increase is higher than the rate of inflation (especially right now) and improvements are added to the purchase price, it really only takes a few years before the unit itself starts to become financially inaccessible to people in the original income bracket.
A functional housing market, where supply is actually meeting demand, should have values that roughly track with inflation, not 5% per year.
Sub-let
These are apartments, not condos, so you can't sell them. And the developer says it's putting strict limits on income for residents.
But, what keeps someone from renting it at the below market rate then turning around and subletting it for twice as much? Or putting it on AirBnB? I'm sure the lease will forbid that, but is the developer going to be knocking on 239 doors to make sure the lessee isn't subletting?
Catching Culprits
In many condo complexes the management and owner occupants are not thrilled by the idea of sublets. Bylaws prevent short term sublets but they can be hard to catch in person, except when blatantly obvious like strange people coming and going with luggage. As such those managers will often scan through listings on sites like AirBnB looking for culprits in their building or complex as a way to find them.
Also the "Cambridge Rent Control" probem
That's where somebody got a rent-controlled apartment as a lower income student, and then stayed there even after making partner at a big law firm.
In other words, not low income, but permanently installed at low rent.
I assume there will be a yearly tax return inspection to stay, but hard to know.
Or a low level mafia hood threatens you
As did with the previous manager of Lincoln Wharf, a mixed income development in the North End, before I used to run it. The manager tried to stop the subletting of apartments to those from the North End who won the lottery for subsidized units and had decamped to houses off of Route 1 North using the rental income from subletting what was technically public housing to subsidize their mortgage.
In the 90's the BRA did not care about the abuse of the system and then Sal DiMasi tried to get those who ran this scam legitimized. Ha ha Sal. How is prison life?
This type of housing is great for honest people, but as if you let people get away with a scam, it will only fester and ruin it for all.
There are services that will
There are services that will notify you if a unit in your building shows up on airbnb. They're even free. So, that route is generally out.
reading is fun.
To quote, you know, the linked article:
but
Those numbers don't match up with what's on the BRA website.
http://www.bostonredevelopmentauthority.org/housing/affordable-housing-i...
It looks like it should be more like $94K for two people.
According to the website
the median income of 2 people is $78,800, which is what the sentence is referring to. 120%-165% of that number, which is 94K+.
Smooth sailing?
This is a great project. Hopefully the BRA and MassDOT can encourage this kind of thing by ensuring that the approval process is smooth. More likely we will endure months of North End residents complaining about how much harder it will be for their visitors to park their SUVs downtown if this gets built.
It's a little disheartening that this project is cheaper because of a number of cross subsidies (including Lovejoy Wharf) rather than, say, reducing parking constructed or controlling construction costs. But more housing is more housing and helps reduce the pressure on fully market-rate units around the city.
What?!
This is an outrage! No, No, No!!!! Fair market value and nothing less! Can't afford it? Go be a poor somewhere else...like Lowell, or something. Sheesh...poor middle classers cluttering up the city. What has this world come to?
Walking distance
This would be walking distance for Coasties, right?
Did you not detect my sarcasm?
There's obviously something behind your question, so why don't you just get to it.
but of course
mwhahhhhhhaaaaahahahahahaha!
Ok...
You won't actually openly say whatever anti-military (and thus, anti-American) comment that you were certainly thinking, so we'll all just move on since this is par for the course for you.
Anti-military (and police) wrongdoing is not...
... anti-American.
Oh, ok...
Where did I say that? Swirl has a history of making snide remarks about the men and women who serve. Fact.
Ha
You might try using that rich imagination of yours in more positive ways. Constant fear is a killer.
Once again...
...you're ranting incoherently.
I am totally happy to see all
I am totally happy to see all these new towers fill up with rich people at fair market value.
Assuming there is some finite number of wealthy people who want to move to Boston, any additional luxury construction will keep these people out of existing housing and hopefully keep rents in the existing buildings from rising as fast.
Simply because new luxury residential construction is not explicitly dedicated for middle-class or low-income housing, doesn't mean that the middle-class or low-income apartment-seekers fail to benefit.
Huh?
Isn't this part of the Greenway. Lovely concept - terrible location. Take one of, if not the best, view corridors in the city and plunk a building there? This is one of those situations where 20 years from now they say - what were they thinking and the only correct answer is "They weren't".
Huh?
It's a vacant lot next to a street and a parking lot...usually full of weeds and trash. Best view in the city?
Not hard to clean it up
And it sits across the street from the Zakim Bridge. Block it and the only street level view is on the sidewalk next to the TD Garden.
Exactly how long
Does one really stare at a bridge?
Don't know
Depends on the bridge. The GW in NY - not long. The Brooklyn Bridge has best selling books written about it and it's a destination in and of itself. The Zakim is essentially a modern symbol of Boston - and I think losing a view perspective from downtown other than being almost on top of the bridge would be a loss.
As I've said before - this whole affordable housing thing is mostly an Oxymoron. It just displaces people who would live downtown and drives up the costs of downtown development. Then those who would otherwise live downtown move to JP, Mission Hill, Charlestown etc. and drive up the rents there. This isn't a solution. It's rearranging the deck chairs and then raising the rent on all of them. But there's money in it for the developers (this isn't a charity) and power for the politicians because it makes them look "progressive".
You use the T to commute?
So reliable, yes?
If you want people to take service jobs downtown, they have to be able to get to them (often both of them). Getting into and out of Boston is increasingly difficult given the transit system woes.
And the solution...
Is building a hundred odd affordable units - you probably couldn't staff the hotel they want with that.
Hey - nice idea - in principal. All that aside - I think the city/state is moronic to allow a building to be built here.
This was never planned to be part of the Greenway
Maybe it should have been, given the view corridor, but it never was. It has always been designated for devleopment, along with the rest of the Bulfinch Triangle parcels that formerly contained the elevated I-93 and Green Line tracks.
There are still plenty of other places you can go to look at the Zakim Bridge, such as the newly reopened Lovejoy Wharf Harborwalk.
See my post below
Response to John Keith - might be a good idea to swap this for something on the other end of the Greenway.
This parcel was designed to support a mid-rise building
Other Greenway parcels (even those intended for the Garden Under Glass) may not be.
Just some clarification / information on Parcel 1B
This parcel (1B on map) has always been planned for *development, at least as far back as 2006. It was never intended to be open space. There's open space nearby, I think it's called the Rose Kennelly Greenway or something.
http://i147.photobucket.com/albums/r289/trixecol/BT-parcels.jpg
It's taken forever for it to get developed due to the economy (and, probably due to laziness on the part of Boston Development Group & MassDOT). The project went through several iterations, changing from hotels to hotels and housing. Now that all the other parcels are either built-on (Avenir, Victor), or being built on (One Canal, nearby), it makes sense to start construction here.
It's a great idea and I hope it all works out. Maybe I'll get divorced so I can qualify to move in! (LOL, joking, Terry, joking.)
It's great that Related Beal is doing this, but it's good business, too.
Overall, a great idea.
PS. Here are earlier renderings of what it was going to look like, back when BDG was on board.
http://i21.photobucket.com/albums/b291/Joe_Schmoe/merano/106merano01.jpg
http://i21.photobucket.com/albums/b291/Joe_Schmoe/merano/106parcel1b03.jpg
And, after it changed to hotel & housing.
http://imageshack.us/a/img689/1038/meranoapprovedfromgreen.jpg
And, what it looked like in 2014.
https://c2.staticflickr.com/6/5192/13731190664_7a681a42e7_b.jpg
Still a mistake
I would have no problem if they swapped this for another lot on the other end of the greenway and did a similar project - more power to them. I just think that destroying that view corridor is akin to re-erecting the elevated.
Thanks!
This is the kind of post I come to the uhub comments for--interesting insights, especially from professionals and locals.
Compare and contrast to the Globe comments on the linked article...