Solving the Rental Crisis

The Commonwealth of Massachusetts made a lot of progress with the passage of the Affordable Homes Act in 2024. In the last issue, I dealt with the advantages that seasonal community designation could have on the housing shortage in Berkshire County municipalities. In this issue, I'd like to address the question of rentals.

One of the provisions of the Affordable Homes Act is that it gives property owners the right to add an accessory dwelling unit. Another is the ability for towns to adopt a waiver of property taxes for landlords who rent their properties affordably.

Kudos to Egremont for adopting, and Great Barrington for proposing, the property tax waiver. It's a smart strategy to create rental incentives that have a relatively small impact on a town's budget. It's also a great way to create affordable rentals, when compared to new construction per unit costs.

I'd like to address a third piece of the rental puzzle: Section 8 vouchers. Section 8 vouchers make up the difference between what folks make and what they can afford in rent. They are much used in Massachusetts cities from Pittsfield to Boston, but less available to smaller Berkshire towns because of factors including the lack of available rental units. Hopefully, adoption of incentives can help to change that.

Landlords like Section 8 vouchers because they create certainty of rent payment. Renters benefit from the subsidy as they are only expected to pay 30% of their income for rent; the rest is subsidized by the voucher.

Availability is based on income, with those earning 50% or less of Area Median Income (AMI) qualifying. For a 1-person household, 50% of AMI in Berkshire County is around $38,000. For a family of four, incomes up to $55,000 qualify. To put this in perspective, a teacher's aide at a local public school makes around $30,000 per year.

Payments to landlords for a studio apartment max out at $953 per month. For a three bedroom, the maximum voucher amount is $1,754.

Massachusetts has about 140,000 vouchers available, or an average of 875 per state house district. South County's Berkshire 3rd district gets only a tiny fraction of this amount.

As we look at strategies to build units for full-time residents, we should be looking at ways to maximize housing availability for both rent and home ownership. Getting more Section 8 vouchers for this region is a critical strategy, especially when combined with supply-side strategies like ADUs and tax benefits and seasonal community strategies such as the ability to build on undersized lots for full-time residents only.

This is an area where help is critical, whether from our State House delegation or from our regional partners at Berkshire Regional Planning and 1Berkshire. Believe me, it will be a topic I plan to bring up in my conversations with them.

This is where a waiver of property taxes for landlords renting affordably can make a big difference. Let's say the taxes on a unit were $5,000 per year. That's over $400 per month in additional income to close the gap between market rents and affordable rents. Add to these subsidies the rental payment at 30% of income, and you are easily competing with market-based rents.

Our best shot at solving our housing crisis is to avail ourselves of every opportunity. We've been given a toolkit. Let's use it to reimagine housing in the Berkshires.

If anyone wants to talk about these issues, give me a call! 413-441-5231.

Section 8 vouchers, qualifying incomes at 50% AMI

Household size	Income limit
1 Person	$38,350
2 Persons	$43,800
3 Persons	$49,300
4 Persons	$54,750
5 Persons	$59,150
6 Persons	$63,550
7 Persons	$67,900
8 Persons	$72,300

 

Maximum monthly rent payments

Unit size	Landlord payment
Efficiency	$983
1 Bedroom	$1,104
2 Bedrooms	$1,451
3 Bedrooms	$1,754
4 Bedrooms	$2,008
5 Bedrooms	$2,197
6 Bedrooms	$2,386

These figures represent the maximum income levels to qualify and the maximum amounts that a Section 8 voucher will pay towards rent in Berkshire County.