Housing affordability little changed

HOUSINGWORKSRI said Tuesday that households earning the state's median income could afford housing in nine communities, above in orange. For a larger version, click here.
Posted 9/20/11

PROVIDENCE – Buying a home remains out of reach for the average Rhode Island household in most of the state’s communities, according to HousingWorksRI’s annual report released Tuesday.

A household earning the state’s median income – $54,119 – during the second quarter of 2011 could afford to purchase a median-priced, single-family home in nine of Rhode Island’s 39 communities. Last year, HousingWorks deemed five communities affordable.

Like last year, HousingWorks said the average household could afford a home in Central Falls, Pawtucket, Providence, Warwick and Woonsocket. Becoming affordable this year were Coventry, Johnston, North Providence and West Warwick.

HousingWorks Executive Director Nellie Gorbea said that while the boost is positive, the number has gyrated over the years with little real progress.

Despite the volatility of that number, she said, it remains a fact that “for two-thirds of the state there’s still a very unaffordable housing market.”

Gorbea said stagnant wages in a market still demanding home prices from the pre-recession era were putting homes out of reach. Home prices fell, on average, 2 percent in Rhode Island from the end of 2010 to the end of the second quarter of 2011. But the median wage fell 2.8 percent to $54,119 from $55,701.

Renters also have felt the squeeze. During the last decade, the average rental price for a two-bedroom apartment rose 50 percent to $1,165, HousingWorks said.

Affordable housing advocates say the state must step up its investment to combat the problem. A bond passed by voters in 2006 put $50 million into affordable housing, all now dedicated to projects. As the last projects spend the remaining dollars, Gorbea said affordability would go down unless another infusion of money arrives.

Passing another bond, as soon as 2013, would boost the availability of affordable housing while providing work for construction firms hit hard by the economic crisis, Gorbea said. Creating housing for the average worker also makes the state attractive for companies concerned about attracting and maintaining a work force, she said.

“I think you get a lot of bang for your buck when you invest in affordable homes,” she said.

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