This article is the second in a three-part series about housing. This installment centers on changes to Bedford’s housing stock since 1943, but particularly over the last 20 years. A third and final article about housing will appear during the week of August 6th. It will examine various alternative housing models.
While the number of free-standing, single-family houses in Bedford has risen only by 189 since 2000, many of these homes are larger by a factor or two or three than those built in the previous decade.
Twenty years ago, according to Glenn Garber, Director of Planning, an “average” Colonial-style house was about 2,000 square feet. By 2002, newly constructed homes were at least 4,000 square feet, with many as large as 5,000. Since 2002, the trend for these so-called McMansions has grown greater still, with statistics showing house sizes up to 6,594 sq. ft.
One of the drivers of large house construction is the price of land. Land is so expensive, said Garber, that in order to recoup costs and make a profit, contractors say they need to build luxury-style homes, often on lots so small that little green space remains. “If you could save on land costs, you could build a smaller house,” Garber said.
Because land is at a premium, many older, more modest dwellings have been torn down to make way for new construction. According to records obtained from Bedford’s Code Enforcement Office, 78 out of a total of 169 demolition permits were specifically for “tear-downs”—or destruction—of an older residence to make way for a new house. (Other reasons for issuing demotion permits include commercial/industrial construction, partial residential renovations, and the removal of in-ground pools.)
The trend toward tear-downs is one of the factors that prompted the introduction of a Demolition Delay bylaw that requires special permitting to demolish a house built before 1943. The goal of the bylaw is to guard against the loss of historically significant houses and to protect the “architectural, cultural, economic, political, or social history of the Town.” The bylaw goes on to express a desire to “promote the public welfare by making the town a more attractive and desirable place in which to live and work and better protect the community character found in the buildings, streetscapes and neighborhoods of the town.”
Looking back to 1943, Bedford had a mere 824 residential units, most—if not all—in the form of single-family homes. The period from 1950-59 saw the town’s greatest growth: 1,417 residences were built, more than doubling the housing inventory. During the following decade (1960-69), another 948 homes were built. Since then, however, the residential building rate has slowed—in the last 40 years, Bedford has added a total of 1,857 housing units, an average of just over 43 a year.
Along with the increases in the number and square footage of new houses has come an increase in median price, with the largest jump experienced between 1980 and 1990. During this ten-year span, median prices rose from $76,600 to $228,100 (an increase of 197.8%). The most recent decade (2000-2010), saw a rise in median house prices from $332,200 to $534,900 (an increase of 37.9%).
Broken down into price categories, the average expensive house was $1,235,000 in 2010; the average medium-price house was $540,000; and the average lowest-priced was $246,000.
The trends clearly show both a supply of and demand for larger, more expensive houses. But statistics also reveal that it is harder to satisfy such housing expenses within the limits of household income. The affordability index, otherwise known as the ratio of median housing cost to median income, has doubled since 1980, from 2.47 to 4.97, which means that it is now much harder for homeowners to cover mortgage expenses.
Foreclosure trends in the region during 2011 were 8.18% of all mortgages. Figures from the Warren Group, a publisher of real estate data, show that the highest rate of foreclosure in Massachusetts (1,400 for the month) was reached in March of 2010, after which it dropped until May of this year, when once again it rose precipitously. “Rather than a drastic uptick, this is a resumption of activity that stalled last year due to challenges to the foreclosure procedure. Now the process has been smoothed out and lenders are starting to ramp up and resume foreclosure activity. The high rates of foreclosure will continue through the summer and fall,” said Cory Hopkins, web editor of the Warren Group.
Moving to the subject of smaller homes and affordability, Planning Director Glenn Garber said, “There is a huge unmet market for empty nester units that people don’t give credit to. Developers could take advantage of the demand but often zoning is an issue.” To change zoning in Massachusetts, municipalities like Bedford require a 2/3 majority vote at Town meetingrather than a simple majority. “It may be the only state in the nation” with such a requirement, Garber said.