This guest post was written by Ira Bryck, Amherst resident and president of the Family Business Center of Pioneer Valley, also based in Amherst.
When my family moved to Amherst in 1993, we were fully aware that it was a college town, and looked forward to that influence on our new home.
Amherst is often considered among the best college towns in the nation, and this has much to do with a healthy balance between town and gown, and protecting affordability for young families.
My contention is that an over-abundance of student rental houses has put home ownership (or rentership) out of reach for the next generation of families we all say we want.
I think a move from the current unenforced limit of four unrelated people in a house, to an enforced limit of three, would have a positive effect on the character of our town and its housing economy.
A house with four students, each paying $800, would be less affordable if three students had to cover that $3,200 per month. I predict those students would seek cheaper housing out of town, or live on campus.
That would create a downward pressure on prices, so a young family could compete to rent that house, or a student landlord would opt to sell that house to a young family, with the price reflecting some deflation of the bubble.
And a pressure on UMass to provide more on-campus housing, in the apartment (not dorm) style that students want. (I’m glad to hear of the new on-campus project, netting 600 more beds.) UMass claims to already house a greater percentage of students than average, but most state universities are not in small towns, and we cannot absorb the student rental population. Amherst already has 60 percent of its houses as rentals, and this has created a bubble and a powerful motive for profiteering.
These market forces would also reduce demand for more outsized buildings downtown. I agree with the many people who think this is an absurd location for buildings that function as private dorms. As well as seeming unattractive, they have been able to avoid setbacks, due to seeming flaws in our zoning bylaws, as well as parking and affordability, and have altered the streetscape of our New England town for generations.
I recently conferred with Robert Frank, a renowned Cornell economics and management professor, author of many books, his textbook co-authored with Ben Bernanke, on his view of this economic problem. Here is his reply:
“Re your question about the effects of limiting occupancy in rental houses to three unrelated individuals: Ithaca has had exactly this regulation for many years. It was adopted with the goal of maintaining a stock of housing in the city that would be both affordable and attractive to families.
“When landlords are free to stuff 7-10 students into a house, the resulting revenue boosts the value of the house as an investment to a level far above what most families could afford. Simultaneously, it creates noise, litter, and parking problems that make the environment unattractive to families. As in many other markets, there is no presumption in an unregulated housing market that an invisible hand automatically produce outcomes that are best for the community as a whole.
“Ithaca’s ordinance has been effective, but it requires vigilant enforcement. If landlords sensed that they could get away with violating it, the economic incentives to do so would be irresistible.”
Add to this a comment made to me by Steve Schreiber, chair of the Planning Board, who is interested in causes and solutions to our imbalance: “Until 2009, UMass required all first year students and sophomores to live on campus (with some exceptions). That year, UMass no longer required its 5,000 sophomores to live on campus (there was an on campus housing shortage). That one change sent up to 5,000 potential renters into the communities. According to UMass, only 1,250 sophomores live off campus — that’s still a big number. I think your proposal is worth considering.”
He also took the step of exploring the aforementioned Ithaca regulation, and he comments: “Ithaca seems to be even stricter than represented above. Three unrelated adults are only allowed in duplexes, but only if one unit only has a single individual. Single family houses can only have functional families +1 unrelated adult. Massachusetts is different than NY and it may be more difficult (if not impossible) to define ‘functional family.'”
Here’s the actual law: “ITHACA—DWELLING, ONE-FAMILY [Amended 4-1-1981 by Ord. No. 81-2; 1-8-1990 by Ord. No. 90-2] A dwelling unit occupied exclusively for residential purposes by an individual or family and not more than one unrelated individual or a functional family unit. In the R-1 Zones, occupancy by an individual or a family and not more than two unrelated individuals is permitted if the dwelling is owner-occupied. In the R-2 and R-3 Zones, occupancy by an individual or a family and not more than two unrelated individuals is permitted.”
Steve also notes that in Massachusetts, two college towns (Lowell and Worcester) have a limit of three.
I do not pretend to have all the answers or know the future. I think our new Town Council will serve us well by exploring the consequences of various strategies. Several people who once objected to my proposal to amend and enforce our over-occupancy regulation now say it’s an idea worth considering.
I hope that nothing I am saying is construed as me not fully supporting quality of life for students, or not supporting the rights of a non-traditional family to have a safe and supportive home. For me, this issue is about creating a sustainable balance in our community, and resisting the market forces that lead to market speculation and how it disadvantages people.
I thank Nick for inviting me to publish my views on his blog.