Everybody's got a right to live
Zillow has declared that the Providence-Warwick-New Bedford MSA (which includes all of Rhode Island plus Bristol County, MA) is the third hottest housing market in the country.
Point-in-time counts of homelessness (a single night census of homelessness gathered by volunteers on behalf of the state’s service providers and reported to the federal government) have revealed a significant 35% growth between 2023 and 2024; and an even more astounding 120% growth in homelessness from 2020 (with a 394% growth in individuals on the street).
The National Low Income Housing Coalition reports that RI has a shortage of 24,054 rental homes affordable and available for extremely low income (ELI) renters, leading two a 2:1 ratio of ELI households to rental units. The Joint Center for Housing Studies reports that the median home price in our MSA in the is 5.3 times that of the median income here.
HousingWorks RI reports that in 2024 there was no municipality in the state where it is affordable to own a home, and more than 11 municipalities where ever a household earning more than six figures in yearly income would find it unaffordable to rent.
In the same report,
HousingWorks notes nearly a third of RI households are cost-burdened by housing
costs, falling heaviest on low-income households and renters. The slow
population growth caused by the housing crisis is likely to lead to us losing our second representative in Congress in
2032, the sole New England state projected to lose representation.
I could go on like this for a long time. Not since the
foreclosure crisis has the housing situation been this bad, and in many ways,
it is notably worse. Progress has been fitful. One problem is that the
Department of Housing (the creation of which was a longstanding goal for
advocates) has had significant leadership problems and
faces an unclear mandate and uncertain control of funding:
the state has to figure out who exactly will be in charge of
administering the [recently passed affordable housing] bond funding once it
becomes available.
“Over the past few years, we’ve added the Department of Housing as a new institution which the General Assembly has tasked with being the lead agency on housing in the state,” explained [RIPEC public policy analyst Jeff] Hamill. “But when it was created, the department was essentially layered on top of the existing institutional structure, which includes the Rhode Island State Housing Resources Commission and Rhode Island Housing. There is no real formal institutional relationship between the three agencies, so there is a little bit of confusion about who is going to control this pot of money.”
The situation is made worse as the charitable affordable
housing developers often pour cold water on the most promising Housing Dept.
initiative, social housing.
One small bit of good news is that for the first time in decades, RI has a Speaker who seems inclined to tackle the housing crisis, once remarking to the Providence Journal “as long as there are Rhode Islanders without a place to live, I’m going to keep housing at the top of my agenda.”
This willingness to tackle the crisis has led him to embrace both market-based solutions like zoning reform, but also more direct government intervention like the aforementioned social housing. That’s significant progress compared to his predecessors, made all the more notable that he doesn’t really have to care about the issue.
The crisis in housing is
most acute among the least reliable voters (low-income and renting households),
and the more reliable voting homeowners are largely insulated from it. That
Shekarchi is not bowing to this dynamic, which has stymied action on the crisis
for years, is to his immense credit.
Unfortunately, this is not enough. New housing is still routinely opposed in many suburbs, and the Mayor of Johnston has
even threatened to attempt to overturn the state’s 10% affordable housing mandate in
response to a 252-unit development (though it’s unclear how, one should never
underestimate a court’s ability to distort a law).
Some solutions have been far-fetched. To be frank, we are not going to kaizen our way out of the housing crisis. We need to lift our eyes our bit. For many years, the State was largely focused on the nebulous workforce housing, ignoring the ongoing crisis at the bottom rungs of the income ladder.
The budget-cutting reaction in the aftermath the
Global Financial Crisis resulted in many successful programs, such
as the Neighborhood Opportunities Program (NOP),
being wound down (today the program is independently funded by the
quasi-nongovernmental organization RI Housing).
Because our efforts have been so uneven, been so mired in a
dizzying array of programs and charities that have filled the void left by
government inaction, it feels difficult to think bigger. And certainly, there’s
a certain truth that our housing crisis will not be solved by One Big Thing,
but rather dozens of reforms and programs that converge.
That said, we should think bigger, as the crisis is going to outstrip our ability to meet under the current status quo. Our goal needs to be for Rhode Island to have a Housing First economy. You may have seen calls for the US to implement Housing First (the idea that to solve homelessness, you address the need for housing before addressing issues like substance use, mental health, or unemployment) with paeans in particular to Finland.
However, Housing First has been federal policy since the George
W. Bush administration (Finland adopted their far more
successful program in 2008). However, since many local authorities failed to
adopt Housing First, it stills feels unimplemented and thus relatively
revolutionary to those encountering the idea even today.
Like the homelessness prevention program, a Housing First economy would put housing as the first need to be addressed in our economy. The goal should be to ensure housing is available and affordable to every resident, as well as would-be residents. Think about the cost-burdened household, paying over 30% of their income towards housing. If we can reduce that amount to even 10% through reducing housing costs, that household has freed up at least a fifth of their income to spend on other things; without direct cash transfers or raising wages.
This means they remain capable of qualifying for income-based
supports and don’t face entering new tax brackets. Since low-income households
spend more, we should see that money enter our economy relatively rapidly, instead
of it literally going to rent-seekers.
To this end, we should think about establishing a long-term
goal for what housing we need to build. Rhode Island currently issues the fewest per capita
permits for new housing in the country. We have not permitted more
than 2000 units since 2006, and we haven’t gone over 4000 since 1988, the year
before I was born. The median age of a unit of housing in RI was 58 years old
in 2023, meaning more than 50% of our housing was built before 1965.
Our housing is not not only inadequate, it’s outdated.
One model goal could be patterned after the Million
Program launched by Sweden in 1965, which successfully built a
million units of housing over the next ten years. We need not be so ambitious,
perhaps targeting 100,000 units permitted (as opposed to units
started or completed). At the time Sweden started its program, it had about
seven times more people than RI does today, so this is less ambitious than it
would be were it simply scaled down to RI-levels; acknowledging that the State
of RI in 2025 does not have the same tools available to it as the sovereign
Kingdom of Sweden did in 1965.
It is still a laughable goal though; this would be effectively increasing our permitting by a magnitude of 10. That said, I think it’s a worthy goal. Boston is experiencing a similar housing crisis, one that exacerbates ours as regional workers look towards our relatively affordable housing market with its rail link to Boston (Pawtucket has already been the primary beneficiary here).
Getting 100,000 homes allows us to absorb Boston’s overflow
while ensuring that our existing residents and people attracted to Rhode Island
for its own reasons aren’t priced out of the market. And picking a goal and
then figuring out how we get there will help focus us.
“How do we achieve 100,000 homes?” should be the overriding question of economic development. Part of that will mean swatting down efforts like Johnston’s attempt to end the 10% affordable housing mandate. But another part of that will be to treat concerns in good faith (or alternatively, call the bluff) of resistant communities.
If there are concerns about sewage that new residents will bring, then the State should aim to finance new systems (many in RI are already antiquated anyways) with additional capacity. If traffic is a concern, then the State should improve RIPTA’s service to our outlying villages.
If concerns about the costs of public education enter the conversation, the
State should provide stronger assistance to schools through the increase in
income tax revenue in order to head off regressive property tax increases
(indeed, ensuring property taxes don’t rise has to be part of any such plan to
lower the cost of housing, since those costs will undoubtedly be borne by
renters). The tradeoff should be clear though; if the State invests in your
town, you must permit the new construction.
It also means thinking about how and what kind of housing we
need to build. According to Apartment List, RI permits the
fewest multifamily units per capita, leading to a staggering
second-in-the-nation rent growth of 5% year over year as of May 2024. And
multifamily units are really where the housing crisis is going to be bested.
Minneapolis’ housing miracle was not due to the much argued over abolition of
single family zoning, but rather due to a massive increase in multifamily construction;
Pew Research data suggests that 96% of new housing permitted in Minneapolis
between 2017 and 2022 was more than five units, with 87% of the total being 20+
units.
Unfortunately, multifamilies are the hardest to build.
The Atlanta Fed found that multifamily housing took 33
months pre-planning to construction in the Northeast (and
that’s with projects that took more than five years to complete excluded); most
industry sources also suggest one needs to tack on a further 6 to 18 months for
a property to properly lease up (the process by which the income from renters
stabilizes the cost of the building). That means a multifamily unit permitted
today might take over four years and three month before a tenant crosses its
threshold.
This is the heart of the problem: the housing crisis is felt relatively immediately by those who suffer its effects. But the solution is, at present, longer than any politician’s term. We don’t just need leaders like the Speaker in the present, we need leaders like the Speaker in the future who will be committed to this.
RI was handed an unprecedented
opportunity when Raimondo resigned; we had a governor with the ability to serve
consecutively for almost a full decade and a massive treasury full of pandemic
and recovery assistance. That would’ve been a great time to unleash a home
construction program. This lost opportunity highlights the need to build a
consensus goal, and then ensure we have leaders who will see it through. If
that seems unrealistic to the reader, one only needs to consider the seven-year
phase out of the vehicle-excise tax. Rhode Island is capable of creating and
enacting long-term policy objectives.
Because the crisis is so fast-moving, so long-lasting, but the solutions so slow to develop, we need to get started. Little Compton is effectively being strangled to death by the lack of housing. But there are efforts there to change that, and thus there are institutions the State could empower if it made a concerted effort to drive housing production.
Even though we may have to build new
organizations and agencies, there are a lot of existing authorities and
nonprofits to further invest in. Right now, we are hobbled in no small part by
competition for dollars, and thus organizations wage a cold war against each
other to access the infrequent dollars from housing bonds. If we go for a big
ambitious goal, that kind of counterproductive backbiting would either have to
end from abundance or because it was stamped out as a hindrance to achieving
the overall goal.
The story RI tells about itself is that we are too small to do big, ambitious ideas like this. We are extremely bad at telling stories about our ability to get things done, but excellent at telling stories about our failures. We tell ourselves that no one wants to live here. But that’s not true; Rhode Island is still a growing state. Our values of toleration and free expression are attractive as people begin to look beyond red states that seek an ever more intrusive form of governance.
What we lack is the housing, the number one reason people move, to
provide a place for would-be migrants, in keeping with our long history as a
refuge for dissenters. We need to tell that story again, that people can come
here and find themselves at home.
