January 22, 2010

Why are we seeing rentals?

Bottom line is that once the sub prime market dried up, it was virtually impossible for the CDC's to sell their owner occupied opportunities to low-mod income people. What did they do? They shifted completely to rentals.

Southgate Place and the Hadley are perfect examples of this. Does anyone really believe that the condos are coming soon to the Hadley?? Lets just settle for a paved parking lot. Southgate Place was orginally suppose to be home ownership, but when they could not get any monies for the Commonwealth (I believe it was DHCD), what they did? Merely changed the application to be rentals.

Did it matter that the neighborhood needs home ownership more then anything else? Absolutely not!!! They need to keep doing developments so once the home ownership money dried up, shift to rentals. If you build three apartments on a small piece of land the costs just don't work out, so jam as many rental units as possible on the piece of property to lower the cost per unit.

This begs the question, where has warehoused low-mod income rental housing truly been successful? Cabrini Green is the extreme, but seriously isn't there a pretty clear track record that this does not work?

1 comment:

Anonymous said...

Because developers (both CDCs and private developers) can utilize a whole slew of existing subsidies to make a sucessful career out of developing subsidized rental housing in Worc. and throughout the Commonwealth.

Create a strong enough financial incentive for the development of market rate housing in Gateway Cities such as Downtown Worcester and I can assure you will get that which you seek.


Eric K.
Worc., MA