Worcester is booming amid Boston’s housing affordability crisis. Now its home prices are soaring, too.
Proposals before Worcester’s City Council would aim to require affordable housing and legalize accessory units.
For decades, Worcester has craved new development.
Now, thanks to Greater Boston’s exorbitant housing prices, the city is seeing its first real building boom in recent history. But the growth hasn’t come without pain.
As new residents flow in, housing prices are shooting up, pinching Worcester’s large population of working-class residents and prompting city officials to look for solutions. Right now, they’re hoping a pair of proposed zoning ordinances will help alleviate some of the pressure.
The measures — one would require developers to set aside units in new buildings at affordable rents, the other would legalize accessory dwelling units — have received broad support from councilors and advocates. But questions remain about their specifics, whether the city should act more dramatically to address the cost of housing, and how to handle the development boom in a way that will keep rents in reach for people who call Worcester home.
“There is a need to provide some governance for the people who have lived in this city for a long time and who are now feeling the consequences of housing being seen as an attractive investment to make some money,” said Steve Teasdale, executive director of the Main South Community Development Corporation. “We have low-income tenants and elders being shipped out of apartments they’ve lived in for 20 years. That’s the human consequence of a real estate boom like this.”
Worcester, the state’s second-largest city, has long been overshadowed by Boston and its closer neighbors, but as home prices in Eastern Massachusetts have soared over the past decade, the city has become an increasingly popular destination for residents who want urban living at more affordable prices. Worcester has consistently ranked as one of the hottest moving destinations in the Northeast, and it was one of the fastest-growing cities in Massachusetts during the 2010s.
The city has added about 25,000 people over the past 10 years, according to Census data, pushing the population over 200,000. Over the same period, the city has only built some 10,000 housing units, falling far short of demand and driving home prices higher.
New housing is not necessarily bad news for renters, said Etel Haxhiaj, a city councilor who has advocated for the proposed ordinances. But when development skews upscale and is almost entirely market rate — as is the case around the new Polar Park baseball stadium — rents may climb.
“We’ve had thousands of units come online, or that were slated to come online, over the last year and a half or so,” said Haxhiaj, who is also the director of education and public advocacy at the Central Massachusetts Housing Alliance. “We’ve only gotten something like 100 income-restricted units from that development. With the number of people we have coming into Worcester, we need to be getting more affordable housing.”
She said the problem is particularly thorny because roughly 60 percent of Worcester residents are renters, and about half pay more than 30 percent of their income for housing, leaving them little cushion when rents go up. By some estimates, the median rent on a two-bedroom apartment in the city has increased by more than $600 over the past decade to about $1,800 a month.
That’s why Haxhiaj supports inclusionary zoning, which is on the books in roughly 140 other communities in Massachusetts, according to the Metropolitan Area Planning Council, and has generated thousands of units of affordable housing in Boston and other communities in recent years.
“We can still take advantage of the development boom and get some guaranteed affordable units out of all of this construction,” she said.
Last September, City Manager Eric Batista submitted an inclusionary zoning proposal to the City Council that would require midsize and larger new buildings to set aside 15 percent of units for people making 80 percent of the area median income — $88,400 for a family of four — or 10 percent for people making 60 percent of AMI — $66,300 for the same-sized family.
Those requirements are in line with other inclusionary zoning policies in Massachusetts: Boston requires 13 percent, though Mayor Michelle Wu recently announced plans to hike it to 17 percent, at 60 percent AMI. But some in Worcester have urged more units for lower-income residents. They also want the affordability requirements to be in place permanently, instead of the 30-year period Batista proposed.
It’s a similar debate to the one that has played out lately in communities closer to Boston — like Malden and Lynn — that have also seen surging rents pressure their longtime working-class populations.
But it’s a delicate balance, Batista argued in a letter to the City Council. Requiring too many units, or deeper affordability, risks scaring off the developers who would build the units the city needs to climb out of its supply crisis, he said, because affordable units don’t retrieve the same return on investment as market-rate housing.
“Inclusionary zoning will not alone be a solution for all of our affordable housing needs,” Batista wrote. “It is one new tool in the toolbox.”
That’s where accessory dwelling units, sometimes known as “in-law apartments,” come in, said George Russell, the city councilor proposing a broad legalization of those units. Doing so, he said, could help relieve some of the city’s general supply pressure even as inclusionary zoning generates more affordable units.
“We’ve got lots of folks who have properties that could have extra units sitting on them, but we’re not taking advantage,” said Russell, a longtime real estate agent in Worcester. “To me, this is just common sense.”
Still, most towns in Massachusetts that have legalized ADUs — small structures on the same property as a larger home that act as a separate housing unit — struggle to generate more than a handful each year, especially in places where they’re only allowed by special permit, as would be the case with Russell’s proposal. Similarly, inclusionary zoning is not a panacea for the housing crisis, said Teasdale, of the Main South CDC. But, he said, it’s a step in the right direction.
“Housing is an issue of critical importance for Worcester,” he said. “We’ve got to start taking this seriously, or we could find ourselves losing residents at a similar rate to Boston.”
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