On December 11, at the Charles River Regional Chamber (CRRC) Real Estate Forum, an audience member asked, “If Wellesley may lose up to 15% of its population over the next five years, why do you need more housing?” “The housing crisis is a regional crisis,” replied Wellesley’s Planning Director, Eric Arbeene. The regional crisis is about who is leaving Massachusetts and what it will do to the economy.
Massachusetts’ population is growing. The fastest-growing segment is 65 and over, a 39% increase between 2010 and 2022. The state’s labor force has been decreasing since 2019. Last year, the out-migration of adults ages 24 to 36 was the largest ever recorded (slide 29). In the past, when Massachusetts lost workers, it was because the state was in a recession. Now, Massachusetts is losing workers during a boom period, with two job openings for every applicant. To help explain why, The Taxpayers Foundation and UMass Boston have released a Massachusetts Competitiveness Index Report listing the State’s strengths and weaknesses.
In the strength column, the state has the best-educated workforce and the highest weekly wage in the nation. The biggest competitive weaknesses are cost – housing, taxes, child care – and commuting times. The young professionals on the panel at the forum noted they would need to make over $100,000 to keep median rent within 30% of their income and that this was often only enough for rentals they did not even like. They spoke of their long commutes and friends leaving the state for lower-cost housing. The housing supply has not kept up with population growth, so housing costs and commuting times have increased as workers drive further for cheaper housing. “The long-term economic growth of the Commonwealth doesn’t work if we don’t have a labor force that can support our economy,” said Doug Howgate, President of the Massachusetts Taxpayers Foundation.
Workers with higher incomes and more education are more likely to work from home. In Newton, over 20% of employees work from home. While this is good for commuting times, it is worrying for labor force stability because these employees are more able to relocate. Newton is part of Middlesex County, which has the highest level of residents with college degrees and the second highest out-migration.
“If people can’t afford to buy or rent in the community they want to live in, they are going to move somewhere else,” said Howgate. He said he believes the state does not have the resources to produce the housing needed and that “incentivizing zoning changes at the local level” is a more powerful tool for increasing the housing supply.
State Budget Challenges
The Taxpayers Foundation foresees challenges to the State budget. During COVID, the State experienced a tax revenue boom of $11,515 million in revenue growth over two years (compared to $11,089 million in growth over the previous ten years). Some of this money was used to expand State programs (free community college, early education childcare grants, MassHealth caseload, and cost increases, etc.), which have increased the State’s annual budget by roughly $4 billion. In addition, the State must pay for the Steward Health care crisis, emergency shelter assistance, and a growing pension liability.
Howgate said that to meet its fiscal demands, Massachusetts needs to figure out how to stabilize and grow its labor force.
Opposition to New Residential Developments
The forum featured a panel of the Municipal Planning Directors from the CRRC’s four communities. They agreed that making it easier to build housing was key to increasing the housing supply. Watertown Planning Director Steve Magoon said it is important to note that it is developers, not cities and towns, that build housing, and that communities need to work with them. He spoke of the difficulty of convincing older residents that younger residents drive less in dense, walkable communities. When the Planning Directors were asked by Fig City News why residents oppose new housing, the most common reason cited was increased traffic. Wellesley’s Director, Eric Arbeene, noted that much of Wellesley’s traffic is cut-through from outside communities, unrelated to local development. Car ownership and total daily vehicle miles traveled by Newton residents have decreased (very) slightly since January 2020. An increasing source of local traffic, not mentioned by the Planning Directors, is the prevalence of delivery services on residential streets. The average American household receives a package every 2.21 days, plus 4 to 5 meals per month.
The last comment from the audience at the forum was a suggestion for municipal planners to do a traffic analysis of new developments after they are fully occupied.
Newton has done this. The Trio Development on Washington Street had a post-occupancy traffic study conducted from September 2022 to February 2023. The study found that actual trips generated by the development were roughly half of the vehicle trips predicted in 2016 and that 64 of the 210 parking spaces in the Trio parking garage had not been leased.
See NewTV’s video recording of Charles River Regional Chamber: Regional Real Estate Forum – The Road Ahead – December 11, 2024.