Rhode Island needs to build 37,000 more residential units in the next six years
to meet the growing demand for affordable housing, according to a recent report.
“Most jobs are not paying enough for housing, and those who can afford it are working two jobs,” said Eric Hangen, president of I Squared Community Development Consulting Inc. in Providence, which released the report earlier this month. “If we want to resolve the situation, we have to build a heck of a lot more housing, and that means an additional 37,000 units between now and 2010, four times as much production as we have been doing each year.”
Almost 24,000 of the new jobs that will be created in the state by 2010 will pay wages too low to rent the average apartment, and even more new jobs – about 35,000 – will pay insufficient wages to afford a home, the report said.
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The Housing Network of Rhode Island and Woonsocket Neighborhood Development Corporation commissioned the study.
“The state’s projecting the creation of 50,000 new jobs between now and 2010 and if you look at housing prices and rents now, and if you look at the wages expected from those jobs, almost half won’t pay enough to afford the average rent,” Hangen said. “You know you have a severe affordability problem when rents” are too high.
Of those who can afford to rent or buy a home, many are devoting a larger portion of their pay than they should be, the report said; and the state is lagging its affordable housing policy goal of 10 percent per municipality.
The metro region, which includes Providence and East Providence, needs 10,142 housing units, the report said. The West Bay region, which includes Coventry, Cranston, East Greenwich, Warwick, West Greenwich and West Warwick, needs 11,644 units.
More than 50 percent of all jobs that existed in 2000 in Rhode Island – an estimated 270,053 – don’t pay enough to afford the statewide average rent for a two-bedroom apartment if the worker had to rely on wage alone, the study said.
About 387,624 jobs in Rhode Island – more than 75 percent of total jobs – are insufficient to afford a median-priced home.
“Fifty thousand households – that’s one-eighth of the households in the state – are constantly in danger of losing their home,” Hangen said. “Builders appear to be champing at the bit on that, but it’s just too darn hard (to build affordable housing). It needs to be possible.”
Roger Warren, executive director of the R.I. Builders Association, hopes the study will complement the state’s new affordable housing law, which will provide tangible housing production goals to go beyond the 10 percent.
“This puts numbers on what we’ve been saying all along; now we have a fairly good idea” of what needs to be built, Warren said. “I think it’s useful in terms of timing and where we are now in the state process. This sets a benchmark where the town says ‘A’ and this report says ‘B’” in terms of units that are needed.
Warren said it’s unrealistic for production of housing to jump from 2,000
units a year to 6,000, the number needed to reach the 37,000 goal. But the state
is taking the right steps, he said.
