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runawayjim Metropolis

runawayjim

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I'm no economist or anything, so this is all pretty baffling to me. If houses are priced at what the market can support, but almost no people in the region can afford these prices, who is driving the market? Is it the tiny proportion of people who make tons of money? Is it the property developers and real estate investors?

I am really honestly completely baffled and more than a little bit exasperated (as you can probably see from my previous posts.) Many of my friends are beginning to leave for less expensive cities like philly, baltimore and pittsburgh.

Someone mentioned AS220 in a previous post -- I was talking to three AS220 employees two nights ago and they were all saying that they're looking to move to other towns where they can afford to buy. They, like myself, have been moving apartments every couple of years as houses get sold, rents get hiked, and for whatever reason, our wages stay the same.

Oh well. I'm pretty much over it at this point. I had a good run here and I learned an important lesson -- buy when you can otherwise you'll get kicked out. So I'm going someplace where I can buy.

i still don't understand the sentiment that there are no affordable houses in RI... i think garris pointed out a bunch of them. i've looked it up to dispute this same though on CL and there's a bunch in the providence area.

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Jerry2 Hamlet

Jerry2

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I'm no economist or anything, so this is all pretty baffling to me. If houses are priced at what the market can support, but almost no people in the region can afford these prices, who is driving the market? Is it the tiny proportion of people who make tons of money? Is it the property developers and real estate investors?

I am really honestly completely baffled and more than a little bit exasperated (as you can probably see from my previous posts.) Many of my friends are beginning to leave for less expensive cities like philly, baltimore and pittsburgh.

Someone mentioned AS220 in a previous post -- I was talking to three AS220 employees two nights ago and they were all saying that they're looking to move to other towns where they can afford to buy. They, like myself, have been moving apartments every couple of years as houses get sold, rents get hiked, and for whatever reason, our wages stay the same.

Oh well. I'm pretty much over it at this point. I had a good run here and I learned an important lesson -- buy when you can otherwise you'll get kicked out. So I'm going someplace where I can buy.

I don't plan on staying here for more than a year either. There are a lot of people on this forum who have moved here because Providence was cheaper than where they came from. ( mostly Boston and NY ) For those who have already purchased a home, they are lucky enough. I'm 30 and came very close to buying my 1st home, but backed out at the last minute. I didn't feel comfortable with my monthly housing payments coupled w/ the property taxes. I'm recently single. The condo was 200K and for half the money, I can enter the housing market somewhere else with equal pay. My company operates out of Mt. Laurel NJ ( Philly is over the bridge) I've seriously contemplated packing my bags this summer. My pay would be exactly the same and put me in a more comfortable position.

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eltron Hamlet

eltron

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I don't plan on staying here for more than a year either. There are a lot of people on this forum who have moved here because Providence was cheaper than where they came from. ( mostly Boston and NY ) For those who have already purchased a home, they are lucky enough. I'm 30 and came very close to buying my 1st home, but backed out at the last minute. I didn't feel comfortable with my monthly housing payments coupled w/ the property taxes. I'm recently single. The condo was 200K and for half the money, I can enter the housing market somewhere else with equal pay. My company operates out of Mt. Laurel NJ ( Philly is over the bridge) I've seriously contemplated packing my bags this summer. My pay would be exactly the same and put me in a more comfortable position.

Is Philly that much cheaper now?

I know its cheap, but its getting up there too...

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eltron Hamlet

eltron

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I'm sort of mergering two or three or ten issues in my head when I talk about the corporate presense. I agree, there are lots of creative people with various degrees of their own funding who can get things done. One thing we need though is more corporations to donate more money to programs that these small groups can benefit from.

The other issue is the even smaller groups with little or no money, things like New Urban Arts as an example. There's a small pool of corporate funds for these little groups to beg from (or a small pool of corporations that are willing to divert funds from excutive payraises to this and other types of programs).

Then there's quality of life things like parks. We need not put a backlit CVS sign under the Roger Williams statue at Prospect Park to get corporate money for parks. My wish for a non-profit parks corporation to take over places like Waterplace and Burnside can't happen if we don't have big corporate money to underwrite these programs.

This is all fine. I totally agree. But I think I am talking more from the small business, entrepreneurial side and less the arts and culture side.

I think this is where we are really going to suffer in the coming years, and its not a gap that is really filled by corporate giving. It needs to be made up through some innovative government driven tools - mainly inclusionary ordinances that couple some give back from big developers to the little guys, be it through affordable housing units or a trust fund for seed money to help people acquire smaller buildings to do things on a smaller scale.

It takes a lot of creative thinking on the little guy's part too...cooporatives and partnerships to pool resources are really where its at in this game...

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Garris Town

Garris

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First:

Again, there's lot affordable housing in the metro Providence area, and definitely in the larger RI area. My professional peer group is making between $36,000 and $55,000 per year, and they're not having any difficulty at all finding housing almost anywhere they want. Go to a random "How much can I afford" housing calculator at online at http://www.google.com/url?sa=t&ct=res&cd=2...EYU4kraDOrLC5TQ and then go to http://www.riliving.com and put in your price range. You might be surprised.

Second:

People who can affording housing in the Providence area are not a "tiny proportion" who have "tons of money." This area is awash in professionals; doctors, lawyers, professors, researchers, nurses, school teachers, administrators, businesspeople, successful artists, pilots, architects, programmers, designers, developers, chefs, entrepreuers, craftspeople, etc, etc, etc who are paid well for what they do.

Does the nurse, her sales manager husband, and their two children (a real family I know) wish the $410,000 house they just purchased in Coventry was $250,000 like it was 5 years ago? Sure! Can that family still easily afford it? Absolutely. They wished they got something more grand for that money (and would have in, say, a suburb of Cleveland or Phoenix), but they did easily get something they're still happy with and, in the end, they wanted to stay in RI and knew they'd have to settle for less than in the exurbs of the Southwest (where his family is from).

Third:

For the East Coast, Providence on the aggregate is quite affordable. Here, from the National Association of Realtors and CNN/Money online are median home costs for the following East Coast Cities from most to least expensive (national medial home costs are 180,000 to 210,000 depending upon which article you read:

New York/N. New Jersey/Long Island NY/NJ/CT $435,200

Boston MA 398,300

Newark NJ 379,700

Washington DC/MD/VA 369,000

Providence RI 271,200

New Haven/Meriden 255,600

Philadelphia PA/S. NJ 164,800

Now, I think these numbers look a little low and don't tell the whole story. Philly, for example, has enormous swaths of depressed areas of poverty that themselves are as large as 5 Providences and change those numbers... I can promise you that from my search, looking at equivalent neighborhoods (Main Line=East Side, Center City=Downtown Prov, South Philly=Pawtucket, etc) Philly is significantly more expensive.

A more subjective, "real life," "middle class" analysis from the CNN/Money site was performed by Coldwell Banker, who asked, "Specifically, Coldwell Banker looked at a 2,200-square-foot house with 4 bedrooms, 2 1/2 bathrooms, a family room and a two-car garage. The neighborhood - a more subjective measure - is one "typical for corporate middle-management transferees."

MA Boston $1,260,000.00

MA Wellesley $1,193,750.00

NY Rye $869,125.00 (NYC's closest urban-ish, densest suburb)

NJ Montclair $658,450.00 (Newark's "East Side" equivalent)

PA Philadelphia $574,567.00

RI Providence $520,000.00

NH Hanover $498,125.00

This comment about East Coast housing was in a Boston Globe article: "There is no incentive for the home-building industry to do anything at the starter-home level," Perry said. ''Land is so expensive, you can't really afford to put an inexpensive house on it."

Fourth:

Affordabilty varies hugely between regions, as I pointed out above. As I said, a household income of 80,000 in SE Minnesota has you in a grand colonial with 3 car garage, a boat, and a cabin "up North." That same $80,000 (and regional salaries are quite equivalent in many cases) does a lot, lot less here. But even in Rochester, New Ulm, or Mankato Minnesota, that $80,000 doesn't buy you housing downtown or in those area's "East Side" equivalents. The most desirable is still the most expensive no matter where you go.

No less an authoritative a source than BusinessWeek Magazine says that the best way for someone stretching a budget in a given region to help their finances is to either:

1 - Move to a cheaper region, or

2 - Take on additional work, at the possible expensive of time and lifestyle, or

3 - Change professions to a higher paying one to allow yourself stay in your region

We all have to make choices.

Some of my college friends and people I trained with are working in some quite dirt-cheap parts of the nation and living like kings. But I know I don't want to work in those places and want the Northeast (specifically Providence) for a number of reasons, but my eyes are wide open at the lifestyle differences and I accept that.

- Garris

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jencoleslaw Town

jencoleslaw

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Garris, does that "what can i afford" thing calculate approx taxes, mortgage insurance and all that junk? Because property taxes etc can add substantially to the monthly payment. What is the mill rate in Providence now? 18 dollars per thousand with the homestead exemption? I honestly can't remember.

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Garris Town

Garris

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Is Philly that much cheaper now?

I know its cheap, but its getting up there too...

Maybe three or four years ago, it might have been. Not now. As I said in my post above, in equivalant suburban and urban neighborhoods, Philly is slightly (and sometimes, like in the case of the Main Line or Center City Condos) dramatically more expensive.

But there are still tons of areas in Philly and Southern NJ that are kind of like the Armory was in Providence 5 or 10 years ago. Very troubled, very depressed neighborhoods, but very, very affordable with promise (be it by architecture or location) that people are "pioneering" in the hope that other pioneers will follow and lead to decreased crime, increased gentrification, better neighborhoods, and ultimately increased home values.

But then there's North Philly, which makes South Providence look like South Beach, Florida. As an urban-issues-savy friend of mine who went to medicial school at Temple depressingly said, North Philly is, "Permanently blighted. That area will never in human history ever improve. It's too entrenched. No project or plan will ever help save it. There's no hope" (ouch!).

Lots of people think back to areas they used to live in, grew up in, knew somewhat well, etc and recall them being so much cheaper in the past then where they live now, and then are shocked to find out the new truth (I was about the area I grew up in!).

- Garris

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Garris Town

Garris

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Garris, does that "what can i afford" thing calculate approx taxes, mortgage insurance and all that junk? Because property taxes etc can add substantially to the monthly payment. What is the mill rate in Providence now? 18 dollars per thousand with the homestead exemption? I honestly can't remember.

Most do indeed incorporate those things, yes. It was very helpful to me in my search.

One thing it doesn't factor in are the costs of living in an area (gas, electricity, cable bills, food shopping, etc). When I plugged in numbers when I lived in Minnesota, I found the estimates on many calculators conservative and low. When I did the same for the Northeast, I found the estimates of what I could afford on the same calculators a little on the high, risky side.

Two tips using all of the calculators online from my experience:

1 - Stick to the ones by reputable groups (for example, Money Magazine) and avoid ones by companies that sell mortgages... I just honestly randomly linked one in my post above, I don't know how good it is...

2 - Put in conservative numbers (for example, put 28% of gross income towards housing rather than the 33-35% some sites will automatically default to and make sure you include your car payments, student loans, etc in the monthy payments you have since that makes a HUGE difference in the price of house it'll estimate for you).

- Garris

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pete11 Whistle-Stop

pete11

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I think there might be some confusion on this board as what constitutes affordable.

Using FHA guidelines of 28% of pre-tax income w/ a 30 Yr fixed mortgage at 6.43 (freddi mac 4/7) would allow someone at the median income (30k) about $75,000. The problem is the median home in Providence is 210k (does not include E.side their median price was 510K)

Affordability indexes nationwide are at all time lows, I will not bore the board with why, but you can read more at:

http://www.housingbubblecasualty.com/

http://thehousingbubbleblog.com/

p.s. earlier in this thread I quoted a % increase of 60% ( then 70%) more listings on the East side. This is based on 158 listings in August and 268 when I made the comment yesterday. Today we are at 279 (a 77% increase)

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Garris Town

Garris

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I think there might be some confusion on this board as what constitutes affordable.

Affordability indexes nationwide are at all time lows

There's no question that "affordability" has taken a hit in the last few years, but the market is correcting and I think for the majority of its citizens, the city isn't unaffordable like, oh, Boston, Manhattan, or SF are.

Just to clarify some stats from the US Census Bureau for Providence County:

"Median income for a household in the county was $36,950, and the median income for a family was $46,694."

Also from the USCB:

MEDIAN INCOME FOR 4-PERSON FAMILIES, BY STATE

Footnotes are located at the end of the table.

-----------------------------------------------------------------------------------------------------------

Calendar year 1/ 2003 2002 200117/ 2000 1999 199816/

Fiscal Year 2/ 20063/ 20053/ 20043/ 20033/ 20023/ 2001

-----------------------------------------------------------------------------------------------------------

Rhode Island 71,098 67,646 70,446 68,418 64,614 62,775

Three-Year-Average Median Household Income by State: 2000-2002

(Income in 2002 dollars)

3-year-average median1 (2000-2002)

Rhode Island 44,311 733 8 26 15

Just to clarify, doesn't the census numbers include the fixed income of the retired in its stats? And doesn't RI and Providence have one of the highest percentages of retired elderly in the nation?

As the phrase goes, lies, damned lies, and statistics.

- Garris

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pete11 Whistle-Stop

pete11

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"There's no question that "affordability" has taken a hit in the last few years, but the market is correcting and I think for the majority of its citizens, the city isn't unaffordable like, oh, Boston, Manhattan, or SF are."

actually more so.

"As the phrase goes, lies, damned lies, and statistics"

Ah Twain, I'm particular to John Kenneth Galbraith who once said

faced wth the choice between changing ones mind and proving there is no need to do so, almost everyone gets busy on the proof.

or

You will find that the State is the kind of organization which, though it does big things badly, does small things badly, too

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  • 2 weeks later...
Carter711 Whistle-Stop

Carter711

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05.jpg

I realize this is just a render, but it's kind of freaky. There doesn't seem to be any kind of pattern to the movement of the people in it. What is the bright blue thing? A diner? The landscaping seems very akward. And the ALCO logo is huge! Kind of reinforces the idea that you're in a kind of manufactured setting. I realize it's not in the greatest area, but it would be nice if it kind of flowed into the neighborhood to promote more development there. Rising Sun is great, but because of the layout of the mills, it has a very self-contained feel which doesn't exactly encourage investment around it.

Hate to sound critical. Overall I think it's a great project, and I give the developer a lot of credit for investing in the area.

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Cotuit Megalopolis

Cotuit

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The Projects and Construction section is generally designed to discuss the actual construction and design of projects, though of course social aspects come into play, but when the discussion becomes much more than about a specific project, which this has, it's time to split the post.

Posts from here and the Rising Sun thread have been comined into a new thread in the Providence section:

Gentrification

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jencoleslaw Town

jencoleslaw

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does a design need to be approved now or what???

basically yes. The developer now has however much time he needs (up to 4 years i think) to get all permits and permissions, and financing I guess, in order, as well as starting to settle on design stuff and then he'll come back to the CPC for Preliminary Plan Approval where there will be another opportunity for public comment in front of the commission.

However, there is always an opportunity for public comment on any project before any board whether it is CPC or zoning or whatever, simply by writing a letter to the board/mayor/city council person...Just because a public meeting isn't a public hearing doesn't mean that folks opinions (whatever they are) can't be noted.

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