By Jim Gallagher St. Louis Post-Dispatch

ST. LOUIS — Last summer, Marie Davis was living in an 800-square-foot, one-bedroom apartment and not liking it. A single woman of 27, she wanted bigger and better.

“I thought, ‘I’m handing money away in rent, and I’ll never see a return on it,’ ” she said.

The housing depression harrowed the building business. “The common theme is that they went long on land at the peak of the market,” said builder Ken Stricker of Consort Homes in Chesterfield, Mo. Builders borrowed to buy big tracts, and were stuck with it when buyers disappeared.

But Consort and others kept building through the downturn, though at a vastly reduced rate. They are leaner firms today living on narrowed profit margins.

Back in the good old days, around about 2006, Gene Stumpf would build 25 to 30 homes a year. They were four- and five-bedroom mansions, covering up to 4,000 square feet and selling for $500,000 or so.

That market has virtually disappeared, unfortunately, says Stumpf, who founded Stumpf Homes in 1985.

Unemployment is part of the reason, but that’s less of an issue for affluent people who buy big houses.

The real problem is the sick market for existing homes: People who might want a bigger house can’t sell the one they now own for an acceptable price.

So builders find themselves building more for people who don’t have homes to sell.

“The market that did best for us is the first-time home buyer,” said Mark Fulford, of Fulford homes in O’Fallon, Ill.

The best sellers are ranch houses, with three bedrooms covering about 1,700 square feet and selling in the $180,000 to $190,000 range, he said.

In some ways, it’s a throwback to the modest developments that sprang up locally in the 1960s and 1970s. But the newer models have extras — double vanities in the bathroom, walk-in closets, and full basements.

Those amenities, plus the newness, is the edge that lures buyers away from existing homes.

Changes in taste, in family size and personal finance are also driving the trend toward smaller homes. Americans no longer see a house as an investment, so there’s less incentive to buy big.

More customers are older couples. “They don’t need 3,400 square feet. Their kids have moved on,” says Stricker.

Kim Hibbs is a custom home builder. His customers are affluent people who want a home designed for them.

Even Hibbs’ buyers are thinking smaller. There’s less call for large family rooms and formal dining rooms, with customers asking for more open floor plans.

They make up for the smaller size with upgrades, creating “jewel box” homes with heated floors in bathrooms, granite in bedrooms.

In the boom times, developers would start a subdivision, build some model houses and wait for the orders to role in.

“Often, somebody would come in over the weekend and I’d have a contract on my desk Monday morning,” said Stumpf.

Usually, builders wouldn’t start construction until an order was in hand. Buyers would wait to sell their existing homes until the hammers were banging, confident of a rapid sale.

That’s changed. These days, move-up buyers don’t sign deals until they have a contract for the old one in hand, and they can’t wait for construction.

So, builders are putting up more “spec” houses — houses built on speculation that a buyer will show up.

“Those are the ones that sell,” says Stumpf.

A spec home strategy requires a friendly bank, and builders say their bankers are getting a bit friendlier.

The custom business has another problem: appraisals. Appraisers drew criticism for overestimating values during the housing boom, and they’ve become conservative in response.

They sometimes have trouble putting a value on a unique custom house, says Hibbs.

Without a high enough appraisal, borrowers can’t get loans, and builders lose the work.

Falling property values in Cheshire County are directly attributable to the recession-fueled national housing bubble, not local affordable housing issues, a state economist said.

“This is not your fault,” said Dennis Delay, an economist with the N.H. Center for Public Policy Studies and the New England Economic Partnership. But you still have to deal with it, he added.

Delay said workforce housing, defined as affordable housing for people who work, as opposed to subsidized housing for the unemployed, is not responsible for driving property values down in Cheshire County. It’s not a case of declining values because of declining neighborhoods.

Rather, he said, the recession caused by the sub-prime meltdown, which peaked in 2008, primarily accounts for the record-high 3,900 foreclosures in New Hampshire last year, and more than 3,000 so far this year.

“Falling property values had nothing to do with workforce housing and everything to do with the (housing) bubble,” he said.

Delay spoke Friday at a business leaders breakfast at Keene State College’s Alumni Center. It was sponsored by Heading for Home, a Keene-based nonprofit housing coalition that is studying how to stimulate more workforce housing in the Monadnock Region.

Heading for Home organized a day-long, region-wide housing summit in June, and Delay’s presentation was an outgrowth of some of those findings. In what’s an ongoing process, the coalition has identified barriers that workforce housing advocates face in the region, and offered possible solutions to some of those barriers. Education — accumulating as much information as possible — is one of them.

“(Workforce housing) is critical to a vital community,” said Gordon Leversee, outgoing president of Heading for Home. “It’s a changing landscape both financially and in many other ways. But we’re small enough (in the Monadnock Region) to get our hands around these issues.”

For instance, Keene State College has added about 200 housing units in the past two years, and more housing is being built by private developers. That could free up some single- and multi-family homes that had been housing college students, a development the coalition is looking at closely.

Delay said that unlike many parts of the country and New Hampshire, data indicate the Cheshire County housing market has stabilized. He said the region has already rode up the housing bubble and back down the correlating market correction.

“You are unique relative to the rest of the state and world,” he said. “You’re very close to being through the housing bubble and correction, at least locally.”

But that doesn’t mean good times are ahead. The average price of a house in Cheshire County today, adjusted for inflation, is the same as in 2000, prompting Delay to call it “the lost decade.”

The N.H. Housing Finance Authority reports that the average cost today for new and existing homes is a little more than $150,000, compared to about $200,000 in 2008.

Because so many houses are in foreclosure nationwide, data suggest banks are withholding them from the market because the return would be so low, Delay said. That means existing inventory has to work its way through the correction, resulting in an unpredictable future.

“We don’t really know where this is going to go,” he said. “Everybody’s playing this waiting game.”

Hence, the title of his presentation: “Stuck in Neutral.”

Delay said his presentation is strictly data-driven and non-partisan. “We’re here to educate, not advocate,” he said.

Other points he made:

New Hampshire’s “Great Depression” actually came in the early 1990s when the state lost 10 percent of its jobs. He said whereas homeowners could count on their homes for 10 percent of their disposable income, it has since dropped to negative-3 percent. “You can no longer use your homes as ATM machines,” he said.

Home vacancy rates today are at what’s considered a normal 5 percent in Cheshire County, compared to 12 percent in the early 1990s.

Two-bedroom rental units are becoming available at a faster rate in Cheshire County than anywhere in the state.

Home ownership by young people continues to decline in Cheshire County. In 2000, 42 percent of residents 35 years old and under owned homes; today it’s 39 percent and dropping, according to the housing finance authority. For those over 35, the share is 70 percent.

The building of new houses statewide has dropped from a peak of about 20,000 per year in the late 1980s and 10,000 in 2005 to under 5,000 per year now.

You are invited to join us on Friday, December 2nd from 7:00 to 9:00 AM for Heading for Home’s 6th Annual Business Leaders Breakfast as we explore the the critical role housing plays in our region’s economic recovery.

The event will include:

• Report of findings and “next steps” from the region-wide Housing Summit held on June 1, 2011
• Presentation Topic: “The Current Housing Environment-what’s changed and where are we going.”
• Featured speaker: Dennis Delay, Economist with the New Hampshire Center for Public Policy Studies and the New England Economic Partnership. a non-profit organization dedicated to providing objective economic analyses and forecasts
• Full, delicious breakfast.

The $10 registration fee covers the cost of breakfast

CLICK HERE TO REGISTER

For questions about the event, contact Susy Thielen at <susyt@headingforhome.org> or 352-1449.

This event is made possible through the sponsorship of Savings Bank of Walpole and Hampshire First Bank, both local New Hampshire Banks.

]]> http://www.headingforhome.org/2011/11/22/dec-2-business-leaders-breakfast/feed/ http://www.headingforhome.org/2011/11/04/homeownership-is-a-real-positive/ http://www.headingforhome.org/2011/11/04/homeownership-is-a-real-positive/#comments Sat, 05 Nov 2011 02:53:37 +0000 Susy Thielen http://www.headingforhome.org/?p=353 by Preeti Vissa

A big part of the American dream is in serious danger — danger fueled by misinformation campaigns that may well lead to terrible policies.

For a long time, owning your own home has been a key part of that dream: One little corner of the world that’s yours, a shelter that not only protects your family from the wind and rain, but also from financial storms. That little bundle of equity can make emergencies manageable and a graceful retirement feasible. And there is plenty of evidence that homeownership helps build stable communities.

But that dream is under attack. More and more media voices have joined a chorus saying that “homeownership isn’t for everyone,” not-too-subtly implying that it’s time to keep the riffraff out. They’ve falsely blamed the subprime mortgage meltdown and resulting recession on efforts to help ordinary, hard-working Americans become homeowners. That chorus grew louder in September 2008, when Fox News host Neil Cavuto infamously blamed the housing collapse on “lending to minorities and risky folks,” and has continued ever since.

In fact, research has shown that the problem is not and never was responsible efforts to expand homeownership, such as the federal Community Reinvestment Act. The problem was toxic, trick mortgages peddled by firms that preyed on the unsophisticated. These loans were filled with booby-traps like low teaser rates with payments that skyrocketed a few years later, negative amortization (meaning that the low early payments actually caused the loan principal and total debt to increase), high upfront fees and prepayment penalties.

Many of these bad loans were refinances, sold to longtime homeowners with equity in their homes who simply needed to make repairs or fix a leaky roof. And millions of borrowers got into trouble simply because of recession-induced job losses.

That’s what happened to Arlene (who asked me not to use her real name), a Los Angeles homeowner whose husband lost the job he’d had for 38 years. She and her husband struggled to get her loan modified for three and a half nightmarish years. Finally, after coming right to the edge of losing their home, they’re in a trial modification and just may pull through, but the experience has been devastating.

Misinformation about the housing crisis has become so widespread that doors to homeownership are closing. Mortgage lending is down, even for trustworthy borrowers. Banks have cut back, and a proposed federal rule could require securitized loans to have a 20 percent down payment — far more than is truly necessary to ensure responsible borrowing. The housing agencies Fannie Mae and Freddie Mac _ imperfect but nevertheless playing a critical role in making homeownership possible for millions — could be closed and replaced with nothing.

In a report released in July, Morgan Stanley argued that we are heading toward a “rentership society,” in part because the drastic cutback in mortgage availability “is severely hindering homebuying.”

Attacks on lending to low and moderate income buyers have gone far beyond what’s needed to avoid the excesses of a few years ago. This overreaction threatens to close the door to homeownership for millions of hard-working, responsible families.

This is both unfair and unwise. It’s unfair because the people who suffered most during the foreclosure crisis never got bailed out, even as the banks got hundreds of billions of dollars in federal guarantees. Now, millions of hardworking families — who often had no connection with the meltdown, except perhaps for losing their jobs in its aftermath _ are finding it impossible to become homeowners.

And it’s unwise because it will only increase the schisms in a society already profoundly polarized between haves and have-nots. It will close off whole communities from the tangible benefits of homeownership.

If this dream dies, a big piece of America will die with it.

Preeti Vissa is community reinvestment director at The Greenlining Institute in Berkeley, Calif.

Keene Mayor Dale Pregent made a prediction last week: “Within the next 10 to 12 years, Ward 1 will be almost totally college students.”

That ward includes Marlboro Street, the neighborhood where I grew up and where Pregent still lives.

On the mayor’s 75th birthday Wednesday, the two of us sat down for coffee to talk about that area.

Marlboro Street has always been an odd mash-up of homes, businesses and industry. Forty years ago, when I was growing up in that neighborhood, big companies such as MPB, Kingsbury Corp. and Markem employed hundreds of people.

There was O.K. Fairbanks grocery store, several gas stations and a couple of car dealerships. Families went to Dog ’n’ Suds to grab lunch or an ice cream, and the only strong presence from Keene State College was a college fraternity house close to Main Street. Single-family homes lined each side of the street, interspersed with apartment buildings. It was a busy street and one of the major arteries into the city.

Today Marlboro Street is like looking at an old, broken-down car: The frame is still good, but there are missing parts, rusty parts and the whole thing needs a good cleaning.

Pregent’s prediction is likely not far off the mark. Students at Keene State are now required to spend the first two years living on campus. After that, they are free to rent in Keene, and it makes perfect sense that they want to live close to campus on streets like Marlboro Street.

Pregent has homes on each side of him that house students, in addition to the house across the street. He has had to go over and talk to them about loud parties, drinking and trash. He said he’s been lucky, because although they party, they aren’t regularly unruly.

And he points out that renting housing to college students is a big business. If a landlord owns a small cape, for example, that could house four students; he or she could earn $2,000 a month in rent. If the landlord has a mortgage of $1,500 a month, he or she stands to make $6,000 a year. If landlords own two of those type houses, they could make $12,000 a year. With housing prices the way they are, it’s not difficult to find a three-bedroom home at a reasonable price and turn it into a profitable rental.

Keene Assessor Laura Thibodeau says there are 42 single-family homes on Marlboro Street, the same as 10 years ago. There has been a shift in ownership; in 2001 seven of those single-family homes were owned by people who lived elsewhere; today 12 of those homes are occupied by people other than the owners.

But that’s just the single-family homes. There are 104 properties on the street, many of them apartment buildings. And the street has multiple personalities in terms of zoning: Parts are commercially zoned, parts are in a residential zone, and then there’s Wheelock School, an elementary school on the corner of Adams Street.

The city, of course, bought the former Supervalu building at 350 Marlboro Street, near Optical Avenue. Part of that massive warehouse, renovated inside and out, is now home to the Keene Police Department.

Kendall Lane, a Keene city councilor who is also running for mayor, said the time to act is now on the future of Marlboro Street.

“It’s the perfect area where the city can be proactive to determine what happens down there,” he said.

He’s referring to planning the redevelopment of Marlboro Street so that the interests of the residents, the businesses and the city are all in line.

He doesn’t have specifics as to what that might mean, but he brought up two issues: the plan for an extension for Victoria Street to end at Marlboro Street, and the fact that Marlboro is one of the widest streets in the city.

If Victoria Street were to be reconfigured so that it ended on Marlboro Street, it would only work if the traffic, which would include tractor-trailers, came out into a business or industrial zoned area on Marlboro. If that part of the street were strictly residential, there would be tractor-trailers rumbling through an area filled with homes.

So the vacant or almost vacant businesses — David Ford, for example — would play into that equation. If the buildings were demolished, what might go there instead? It could be housing, a park, a strip mall, a restaurant, a flea market. The city has the opportunity now to develop a plan for what that area, and the rest of the street, looks like.

The width of the street is a double-edged sword: It’s good in terms of development, because there is room to grow, but there is a school there, so it’s perhaps not the best move to pump too much more traffic onto the street.

The society of Marlboro Street has changed, Pregent said. “In a transient neighborhood,” he said, “you don’t know your neighbors.”

Marlboro Street is inhabited in part by students. There isn’t the nudge to mow your lawn from the lawn maniac next door. There isn’t the drive to keep the house painted, the trash out of sight. While he was talking about Marlboro Street, Pregent mentioned the way the street is “used,” rather than “lived on.”

Many of the homes still look nice, and certainly the businesses owners keep their businesses looking professional.

But there is a slightly tarnished look to the street. Like Pregent said, it is a street that is used, rather than a street where people live.

Sherry Hughes is a Sentinel columnist.

We are losing key professionals from the Monadnock Region.  Young professionals, nurses, teachers, emergency response personnel, accountants, small business owners and hard workers in many local businesses cannot afford to live in our region.

Young people are choosing to move to other states where significant investments have been made in housing that is reasonably priced. Heading for Home has been working toward making sure that these professionals that contribute so much to our community and our economy can live here at home.

We have identified the most significant barriers to moving forward on critical workforce housing projects and now we need you! It’s time to refine the strategies to breakthrough the existing barriers and move into an action phase that produces affordable workforce housing for these valued community members within the next three to four years.

Join us on June 1st. from 7:30 a.m. to 2 p.m. as we work together on strategies to break down the existing barriers to these projects within the Monadnock Region.  Your experience and time will be critical to solving this challenge as we move forward.

The day will include:

* Speakers with experiences in local towns working toward implementing affordable housing
* Roundtable discussions with members from important economic sectors to resolve these issues
* Great food

The $20 registration fee covers the cost of breakfast, lunch and snacks.

Register Now!

For questions about the event or registration, please contact Heading for Home at the email or phone information below.

Thank you for your interest and support. We look forward to seeing you at the Housing Summit.

Sincerely,
Susan Newcomer, Heading for Home Board Member
Workforce Development Coordinator
Greater Keene Chamber of Commerce
HousingSummit2011@gmail.com
603-352-1303 x14

Platinum Sponsors: Public Service Company of New Hampshire
Sustaining Sponsors: New Hampshire Housing, Citizens Bank

Housing without a date to economic recovery dance By Kevin G. Hall McClatchy News Service

WASHINGTON — Many sectors of the U.S. economy are showing heartening signs of growth: Employment, international trade, manufacturing and professional services among them.

Then there’s the miserable housing sector. It’s still missing from the list of positives, still a net drag on the U.S. economic recovery.

Where’s the bottom? Four years into the housing crisis, specialists still aren’t sure if we’re on our way up or still have further to drop.

Mark Zandi, the chief economist for forecaster Moody’s Analytics, expects a bottom in home prices next year and recovery thereafter.

“House prices will bottom out by year’s end as the market works through a bulge of distressed sales,” Zandi said. “Sales, construction and prices will be recovering in earnest by this time next year.”

That’s too soon for Mark Vitner, a senior economist at Wells Fargo Securities in Charlotte, N.C. He doesn’t see the housing market returning to normal until 2016. Yes, five more years.

“If you assume we’re adding 2.8 million people a year (to the U.S. population); 1.35 million new homes a year. Tear down 200,000 a year … we don’t get to a normal year until 2016, really,” Vitner said.

Even when home prices stop sliding in much of the country, or sales by distressed borrowers level off, there’s a whole other wave of pent-up sellers waiting on the sidelines.

“You’ve had a lot of people who’ve held homes off the market because they don’t want to compete with foreclosures. It’s likely to be a buyer’s market for awhile, mainly because there are so many homes on the market and there is still a limited supply of qualified buyers,” Vitner said. “The supply of buyers is being limited by high unemployment and the large number of people with homes they can’t sell.”

Here’s one grim indication of where housing stands. Before the housing bubble burst, residential investment accounted for about 6.3 percent of the nation’s economic activity. Today, that number has fallen to around 2.4 percent, according to Michael Mussa, a former International Monetary Fund chief economist now with the Peterson Institute for International Economics, a research group.

Another measure: In February, the last full month for which data is available, distress sales accounted for almost four in every 10 homes sold nationally, according to the National Association of Realtors.

In March 2008, distress sales accounted for 18 percent of total sales. This number peaked at 49 percent in March 2009, and fell to the low 30-percent range for most of last year as many states imposed foreclosure moratoriums. The number climbed back to 39 percent in February as these bans were lifted.

“The uptick in distressed sales in recent months results from tight credit and smaller shares of traditional buyers,” said Walter Molony, a spokesman for the National Association of Realtors. “As a consequence, all-cash sales and investors have been a larger share, with a focus on the discounted pricing of distressed property.”

Tight credit is a polite way of saying banks aren’t lending. After the easy-money days of the housing boom, banks hit reverse and are reluctant to lend for refinancing an existing home or purchasing a new one.

There’s logic to the banks’ reluctance. If prices are going to keep falling, then homes could quickly be underwater — worth less than the mortgages that financed their purchase. An estimated 25 percent of homeowners in the U.S. currently are underwater, unable to build equity as they make monthly payments.

“I think what makes the cycle particularly unique, painful, just difficult, is that … one in four homeowners nationwide are underwater,” said Leslie Appleton-Young, the chief economist for the California Association of Realtors. “In California, I believe the number is 31 percent. It’s a whole different decision to trade up or down when you don’t have any equity in the mix.”

Michelle Meyer, a housing economist with Bank of America Merrill Lynch, is more blunt about prospects for the national housing market.

“The bottom line is that housing conditions vary significantly by region, zip code and even street,” she wrote in March 25 research report. “For those in the market — either buyers or sellers — do not expect a normal experience, because it does not exist.”

Urbanland

March 9, 2011

Asked how she imagined her retirement, Janet LaBelle laughed.

“On a beach, with a pool boy fanning me,” she said, before turning more serious. She thought she might travel and see more of the country, take some time for art, and volunteer at the hospital, she said.

Things aren’t working out as planned.

LaBelle has seen her income drop and her expenses skyrocket in recent years due to a series of medical crises. On top of illnesses and financial difficulties, she can’t find an affordable place to live, part of a chronic problem in the Keene area.

Home rentals in non-metropolitan areas of New Hampshire are the fifth- most expensive of any state in the country, behind Massachusetts, Hawaii, Alaska and Connecticut, according to the National Low Income Housing Coalition, a nonprofit advocacy group. If you include cities, New Hampshire is the 10th-most expensive state for renters.

LaBelle, 66, spent her career working in health care and for social service agencies, first as an administrator and later as a psychiatric crisis worker, after earning bachelor’s and master’s degrees through the adult degree program at Norwich University’s Brattleboro campus. She also raised four children.

“It was going reasonably well,” she said. “I had planned to work for a few more years; there was retirement in the future but I didn’t have a target date, per se.”

But then, in 2008, she got sick. First with cancer, then pneumonia and methicillin-resistant staphylococcus aureus, better known as MRSA, a particularly virulent bacterial infection.

What was initially a six-week medical leave extended for months. And all that time in bed caused additional problems — anemia, arthritis and back pain. When her employer told her she had to either return to work or be removed from the payroll, LaBelle said, she didn’t see many options.

“The work that I did required a lot of walking and a lot of mobility and I just knew I wouldn’t be able to do it,” she recalled.

When the paychecks stopped coming, LaBelle turned to Social Security and long-term disability insurance. She knew she needed additional help to keep a roof over her head, but help proved surprisingly hard to find.

“It’s okay if you can plan ahead, and say ‘I’m going to have my emergency in three years,’ ” she said. “But emergency housing was not available. Every place I called, it was the same thing — they all have waiting lists.”

The waiting list

In Keene, every federally funded public housing program has a wait list measured in years. For the Section 8 voucher program, which would have allowed LaBelle to stay in the apartment she was living in when she got sick, the N.H. Housing Finance Authority estimates a wait of between six and eight years. In Keene, people who have recently come off the waiting list have been waiting for four years, according to P. Curtis Hiebert, executive director of the Keene Housing Authority, which runs federal housing programs in Keene and surrounding towns.

“I thought, they’ll come down, they can subsidize my apartment — I’m already here. But that’s when they said a seven-year waiting list,” LaBelle said.

With the help of a fuel voucher from Southwestern Community Services and rental support from the city’s welfare office, LaBelle made partial rent payments on her $900-a-month apartment while she looked for a job that she could do from home to accommodate her limited mobility. The landlords worked with her for many months, but eventually took legal action.

At the end of last year LaBelle was evicted from the apartment she had lived in for a decade. She owed more than $9,000 in back rent.

Difficulty for renters

“There’s not that many places to turn to if you’re having trouble making rent,” said Jane N. Law, director of communications at the N.H. Housing Finance Authority.

The economic downturn contributed to the difficulties faced by those who, like LaBelle, fall victim to circumstance.

In the wake of the national financial crisis, homeowners got a lot of help from the federal government, but renters got no such assistance, according to Law.

At the same time, people who lost their houses moved into the rental market.

“The price of homes has dropped, but rents have not gone down,” Law said.

The Housing Choice Voucher, commonly referred to as “Section 8,” is a federal program that helps people with low incomes pay their rent. Recipients can live anywhere the landlord is willing to accept payment through the program, and the government subsidizes the difference between the area’s fair market rent (calculated by the U.S. Department of Housing and Urban Development) and approximately 30 percent of the recipient’s income.

The number of vouchers is limited, but once a person or family is in the program there is no time limit on how long they can stay, according to Law. A voucher guarantees help with housing as long as the recipient’s annual income stays below the limit for that voucher.

In 2010, a family of four in Keene was classified as Low Income if its income was less than $55,300, Very Low Income if its income was less than $34,550, and Extremely Low Income if its income was less than $20,750. For a single person, the cutoff for Low Income was $38,750, Very Low Income was $24,200 and Extremely Low Income was $14,550.

“Any disabled or elderly person, they may very well be on that voucher for a very long time because they have a very fixed income,” Law said.

There are more than 700 families and individuals in Keene on waiting lists for housing vouchers or subsidized housing, according to Hiebert.

“Some of them are homeless, some are living with friends or family, some are paying 70 or 80 percent of their income to rent,” he said. “And when you’re paying that much of your income to rent, your other options are limited.”

While the economic downturn has made the problem worse, there has never been a time in his 23 years at the agency when the supply of subsidized housing has met demand, Hiebert said.

Keene Housing Authority has 447 subsidized units available and 293 vouchers that people can use with independent landlords. The wait for a three-bedroom unit can be as short as a year, Hiebert said, but the list is much longer for the one-bedroom apartments suitable for most disabled and elderly residents.

In 2009, two-thirds of the people on waiting lists in Keene fell into one of those two categories.

Living out of suitcases

LaBelle was able to move in with her 43-year-old son, Michael Porter. Porter is autistic and himself living with the help of a Section 8 voucher, in an apartment he has occupied for 17 years.

“I wanted him to be independent, that was my intention as he was growing up autistic — that he not have to live with me the rest of his life,” LaBelle said.

The apartment wasn’t intended for two people.

“The things that I’ve had in my home for years are now in boxes in storage,” LaBelle said. “I feel kind of displaced because I’m basically living out of a couple of suitcases.”

But searching for housing outside of the subsidized system has proved difficult as well.

LaBelle applied for a discounted one-bedroom unit advertised by Southwestern Community Services. She says she could afford the $600-per-month rent, but after a bad credit reference from her previous landlords, her application was denied.

“We try not to set people up to fail,” said Keith Thibault, the agency’s chief development officer. He said he could not comment specifically on LaBelle’s application.

Unlike the housing authority, which is supported by federal subsidies, Southwestern’s units are not subsidized, Thibault said. He characterized Southwestern’s housing as the “next stage” after the housing authority’s services.

Southwestern’s apartments are available to people with incomes at or below 60 percent of the area’s median income. In Cheshire County, that means a maximum income for a single person of $29,040 per year, or $41,460 per year for a family of four. In addition to the income requirements, the agency conducts credit checks, landlord checks and criminal background checks, according to Thibault.

“You must have the income in order to pay the rent,” he said.

The lack of affordable housing options extends to this level as well.

In Keene, units that become available are rented in the time it takes to clean them out for the new tenants, Thibault said.

“There’s a tremendous demand for affordable housing. For those who have very little and up to a moderate income, there just isn’t a big supply,” he said.

The demand for college housing, while not necessarily a bad thing in itself, exacerbates the problem in Keene, according to Thibault.

“A lot of what might be affordable housing to a working family gets eaten up and occupied by college students,” he said.

A drop in the bucket

Southwestern Community Services expects to make 24 new apartments available in Keene this summer or fall in its CitySide housing. They will be available to people of any age who are not college students, but the effect of 24 units on the demand will be so small as to not be measurable, Thibault said.

Since 2007, Southwestern Community Services has been responsible for the addition of 64 units of workforce housing and 95 units of housing for the elderly, Thibault said. This includes 57 units now operated by the Keene Housing Authority at Stone Arch Village.

The biggest impediment to housing construction is a lack of infrastructure, according to Thibault.

“You really need water and sewer to be able to build affordably, and a limited number of towns in this area have that infrastructure,” he said.

Another way that towns can help increase affordable housing is by choosing spots to change zoning laws and allow denser development, he said. For example, the town of Dublin decided last year to waive certain zoning regulations and allow construction of twice as many houses per lot, he said.

A state law that came into effect on Jan. 1, 2010, intended to make it harder for towns to turn away developers who want to build affordable workforce housing.

Availability of federally funded resources like the Section 8 voucher are dependent on decisions made in Washington, D.C.

But the Keene Housing Authority is working on freeing up what is available. It has a program to help those who are physically able to work strike out on their own, with job skills training and help looking for work.

In the past two years, 20 percent of residents have moved out of the subsidized housing program, according to Hiebert. Of those, 10 percent went on to own their own home, he said.

LaBelle hopes that she can use her experience to help other people in a situation similar to her own. She has started a Facebook group called “Not On The Streets,” and hopes to offer support and advocacy for anyone who loses his or her home because of illness or age.

“There are many other people that are going through this, and this isn’t just about me,” she said.

Support from her friends and family have been her key to getting through this trying time, LaBelle said.

“They’re exploring and looking for things that will help, and they’re encouraging me to do what I’m trying to do,” she said. “Everybody in their own way has done something, whether it’s calling the (state) senator or writing a letter or helping me pack or letting me stay, everyone has just gone way out of their way. I couldn’t have done it without all of that.”

In addition to waiting lists, LaBelle is looking independently for housing she can afford, and she said she hopes to move out of her son’s apartment and into her own place this spring.

Sarah Trefethen can be reached at 352-1234, extension 1439, or strefethen@keenesentinel.com.

ORLANDO, Fla. — Apartment dwellers could be facing double-digit rent increases in the coming years as a shortage of new multifamily units coupled with a rise in prime renter-age households gives landlords clout they haven’t seen since the mid-1990s, development experts said Thursday.

“Demand pressures are building. It’s not bad today because rents have been down the last two years,” said William McLaughlin, an executive vice president with AvalonBay Communities in the Northeast.

“But it feels a lot like 1992, when we were coming out of a deep recession … and we ended up seeing double-digit rent increases after that,” he said.

Multifamily developers broke ground on just 114,000 units in the United States in 2010, a figure so low that it wouldn’t account for all the multifamily units lost last year to the wrecking ball or natural disasters, David Crowe, chief economist for the National Association of Home Builders, said at the International Builders Show here.

Although expected to grow 16 percent to 133,000 starts in 2011, that number, too, would leave a substantial deficit in the number of units needed to meet expected demand.

“We’re way behind on the typical allocation of household formations, with people living at home, in roommate situations or staying in the school dorm,” Crowe said. “When they start bursting forward, they are going to need a rental place.”

Whether those 18- to 24-year-olds will find a rental place and whether they will be able to afford it in the coming two or three years is in question. Already there are signs the apartment market is tightening, and in some cities, rents are already going up 7 percent or 8 percent per year.

“I’ve never seen so much pent-up demand,” said Jay Jacobson, a partner in the Boca Raton, Fla., office of Wood Partners, a national development and investment firm.

Jacobson said his company’s portfolio of rental properties has a 96.5 percent occupancy rate. In Miami, occupancies are running 98 percent, and some properties are full with waiting lists. Rents have already started to climb, going up an average 4 percent in 2010, he said. But in some markets those increases are 7 percent to 8 percent.

“Why the demand? It’s impossible to buy a home because it’s darn near impossible to get a mortgage,” Jacobson said. “And we have this huge population in the biggest renter cohort” about to hit the market.

Even though builders can see the demographic necessity of building more rental units, the process of bringing apartments from the drawing board to completion is an arduous one.

“We’d love to build more, but it is just taking longer to get in the ground with them,” McLaughlin said. “If we went in the ground today, we wouldn’t deliver those units until 2012 or 2013. And if we just are looking today and find a piece of ground, it could be 2015 before we could deliver.”

Financing has been a problem for multifamily developers as well. Although a publicly traded REIT such as AvalonBay can secure funding, most other developers are scrambling to secure debt and equity financing as traditional lenders have backed off the sector.

“All the tools that we have known for so many years just went away. We’ve had to get creative,” said Robert Greer, president of Marlton, N.J.-based Michaels Development, which builds affordable rental properties using low-income-housing tax credits.

“When we open a 100-unit project, with three- and four-bedroom units, we will have 800 applicants every single time, wherever we are building across the country,” he said. “Without more investors to provide equity and more capital financing, it is going to be very difficult to meet that demand.”