Affordable Housing
I am in favor of housing affordability, and I would oppose any attempts to enact policies that exclude people from living in neighborhoods or municipalities based on their background, culture, or inherent personal characteristics. That said, the cost of housing is a difficult topic without many obvious, easy-to-implement solutions. Otherwise, it would already be solved.
Below, I’ve expanded significantly upon a previous response to a constituent question to clarify my stance on key ideas that impact the cost of housing. Please also see my responses to a candidate survey on housing for additional insights on topics not addressed below.
Security Deposit Insurance
I propose to create a system of security deposit insurance for renters that only costs $1 per day per rental unit. Each bond can be offered by a renter to any landlord in Massachusetts to cover up to $5000 of damages annually that would otherwise be covered a security deposit claim filed by a landlord.
This Security Deposit Insurance proposal was added on August 3rd 2024. After writing this proposal, I discovered that a somewhat similar piece of legislation was introduced in the New York State legislature in 2023. Unlike the proposed NYS legislation, I would propose to make Security Deposit Insurance broadly available and appealing to all residential renters to minimize the potential costs to taxpayers.
Benefit for renters who can least afford a security deposit
In Massachusetts, many rental properties require 3-4 months worth of rent, typically: first month’s rent, last month’s rent, a security deposit (typically equivalent to one month’s rent) that is held in escrow until move out (meaning that the security deposit from a current apartment can’t be used to secure a new apartment), and a broker’s fee (also typically equivalent to half or a full month’s rent).
For a couple or family attempting to rent an average 2 bedroom apartment in Waltham in 2024, the cost is approximately $3200-$3500 per month, which would require $9,600-$14,000 in up front costs (ignoring the costs of actually moving). Reducing that cost by approximately $3,000 (paying only $365.25 per year for security deposit insurance) would reduce that initial cost barrier by 20-30%!
Furthermore, there could even be an opportunity to setup payment plans that enable renters to pay for policies on shorter duration (e.g. monthly or weekly) and/or employers could offer benefits to employees that allow for pre-tax paycheck withholding of security deposit insurance premiums to provide additional piece of mind for landlords that might be on the fence about accepting a shorter duration security deposit insurance certificate.
Benefit for renters who are able to afford a security deposit
To ensure the widest possible insurance pool (and avoid only the most reckless renters from participating), it is important that all (or nearly all) renters have an economic incentive to participate in the program.
For those that can technically afford to pay the security deposit regardless of cost, the insurance premium costing $365.25 per year would be approximately 1/10th of the face value cost of the security deposit for a rental unit with a monthly rent of $3,652.50. (Note that, the more expensive the security deposit is, the more favorable this insurance becomes up to the coverage limit if the premium costs are fixed.)
In practice (assuming that no claim against the security deposit is made by the landlord) that value would be tied up in a zero-to-low interest escrow account, which could effectively be rolled over year-to-year as a renter moved from one unit to another. Superficially, this seems like the responsible renter never actually loses any money, so why would it be beneficial to pay $365.25 per year out of pocket for security deposit insurance? It affords renters additional financial liquidity — and could constitute a healthy emergency fund if invested conservatively.
For example, if an individual renter (or couple or roommates) had invested $3,287.25 (that is $3,652.50 security deposit less the $365.25 cost for the first year) in a mutual fund that tracks the S&P 500 in June 2014, with an annual withdrawal of $365.25 each June (to cover the next year’s insurance premium), the investment would be worth approximately $3,195.90 by the end of June 2024. This total reflects both the actual historical returns of the S&P 500, the reinvestment of dividends, and the annual withdrawals over the 10-year period. (See a detailed table of historical returns below.)
While this particular example would result in an effective average annual “loss” of $9.13, it would have — unlike a security deposit held in escrow —allowed the security deposit policy holder immediate access to the funds from their investment at any time during the past decade. Also, assuming that the renter wanted to move at any point during that decade, it would have allowed them to avoid the need to save up the “extra” security deposit funds required to bridge the gap between signing the new lease and receiving the previous security deposit from the old landlord.
Benefit for landlords
The coverage amount of $5,000 annually far exceeds the actual amount of security deposit held in escrow for most rental units in Massachusetts, which is typically the equivalent of one month’s rent. Assuming that the landlord could be established as the named beneficiary of the policy as long as the lease is effective (and for some reasonable period afterward to allow for the claims process), landlords could significantly reduce the administrative burdens required to setup, maintain, and report on the escrow accounts as required by G.L. c. 186, § 15B.
Landlords of exceptionally expensive properties could require renters to provide security deposit insurance policies in multiples of $5,000. (However, note that to avoid this requirement from trickling down to low income renters, this practice would necessarily be prohibited for rental units that cost less than $5,000 per month.)
Additional Potential Benefits
Aside from freeing up significant amounts of capital that would otherwise be sitting idle in escrow accounts, any legislation enacting this program could cap the return that the insurance program administrator is able to earn as profit with excess (unused) funds returned to policy holders, used to provide funding for the construction of permanently affordable housing by municipalities, or used to create a low interest revolving loan fund for developers that are constructing affordable housing in Massachusetts.
Reduce Parking Requirements
I strongly support policies that reduce or eliminate parking minimums, which can be used as an underhanded way to prevent affordable housing, add unnecessary costs for construction, and reduce the flexibility of architects, urban planners, and residents. While parking is always a contentious issue in a city, anyone who is trying to solve the housing crisis without addressing parking is fighting with both hands tied behind their back.
Parking Related Podcast Episodes for Context
• 99 Percent Invisible “Paved Paradise” episode
• Freakonomics Radio “Parking is Hell” episode
• Cautionary Tales episode about privatizing parking meters
Obviously, those episodes are not specific to Waltham but many of the concepts discussed apply here (and really everywhere). While not always at the forefront of the housing affordability discussion, how we handle the real estate for our vehicles is tied directly to the cost of housing.
Raising Occupancy Limits
The next step of any affordable housing policy should be to make use of all available housing capacity that can be used in a safe, sanitary, and dignified manner. This means allowing property owners more discretion over which bedrooms in their home or on the property are available to rent. This also means allowing tenants more flexibility to choose who they live with regardless of state-recognized familial bonds.
Currently, any rental unit with 4 or more unrelated occupants is considered a lodging or rooming house subject to additional requirements by state law. I would support a proposal to modify the state level definitions for lodging and rooming houses to allow for up to 6 unrelated occupants.
Furthermore, if any of the existing requirements for lodging or rooming houses are necessary for the safety and sanitation of occupants, they should be expanded to apply to all rental properties — since presumably germs and rodents won’t act differently based on whether the occupants of a property are related or not!
Context for Waltham
Currently in Waltham (and many other municipalities in Massachusetts), there are strict limits to how many unrelated occupants are allowed to live together in a single “dwelling unit”. In Waltham, the limit is 3 unrelated occupants (excluding dormitories of charitable, educational or philanthropic institutions) in a home or dwelling unit. This means that (even in a house or apartment with 4 or more bedrooms) two unmarried couples or four friends are unable to live together.
By Waltham zoning ordinances, lodging and rooming houses (where permitted at all) have more strict minimum off-street parking requirements: 1 parking space per rented bed (which by definition is at least 4 parking spaces per dwelling unit) rather than 2 parking spaces per dwelling unit.
Waltham is also home to two major universities (Brandeis and Bentley), so I am aware that many property owners in the neighborhoods near these universities are already concerned about off campus student rentals. I want to stress that while this is an important concern to address, it should not be used to block the legitimate expansion of affordable housing options for our lower income residents!
Rent Control: No Thank You!
There are many economic market forces at work in the real estate market, and the long-term detrimental effects of policies such as rent control on neighborhoods and municipalities that enact them are well documented and understood by economists (despite the easy applause for politicians).
I do not support rent control, because it locks up the housing market. In the short-term it appears to benefit tenants that are already occupying units when rent control is implemented.
Rent control discourages those tenants from moving into better housing options even if their financial situation improves or considering otherwise lucrative job opportunities in other regions for fear of losing their guaranteed cheap housing as the job market naturally ebbs and flows in the city.
This means that within a few years of implementation the availability of affordable housing counterintuitively decreases as the next generation of residents that could benefit from affordable or entry-level housing are locked out of the rental market. It also unfortunately discourages property owners from investing in improvements or even properly maintaining rent controlled units, because they can actually benefit when tenants are too frustrated to stay.
MBTA Communities Act: Maybe Sort Of?
The MBTA Communities Act, which was passed in January 2021, primarily focused on addressing Massachusetts' housing shortage by requiring municipalities with MBTA transit stops to change their zoning regulations to allow multifamily housing by-right within a half-mile of these transit stations. The law mandates that these zoning districts must have a minimum gross density of 15 units per acre and be suitable for families with children, without age restrictions.
While this is generally a noble sentiment, it may be one of the most expensive and impractical ways to develop marginal amounts of incremental housing in already dense areas. There are already indications that municipal administrators have many ways to evade the intent of the legislation while still technically meeting the letter of the law. (Let alone municipalities that are battling the legislation in court.)
Context for Waltham
For Waltham most of the areas within half a mile of the three MBTA Commuter Rail Stations (i.e. neighborhoods downtown, by Brandeis, and Waverley Square in Belmont) there are limited practical options to construct new housing (affordable or otherwise) without demolishing historic structures (such as the one containing the Charles River Museum) or building in preservation and wetland areas along Beaver Brook and the Charles River.
While I will not seek to roll back the MBTA Communities Act if elected, I would consider supporting efforts to refine it. I also strongly support the expansion of reliable and useful bus service along Trapelo Rd across northern Waltham.
At the city government level, I would also strongly support the development of a formal master plan (including transportation, housing, recreation, and other types of development).
I openly invite anyone with suggestions about innovative ways to increase housing affordability without disadvantaging families whose wealth is often anchored on their most expensive financial asset (i.e. their house or condo) to contact me. I’m willing to learn, and I want to make Waltham (and Massachusetts generally) a welcoming and affordable place to live.