Download Rutland, VT Housing Needs Assessment and Market Study

Rutland, VT Housing Needs Assessment and Market Study FINAL report: September 5, 2012 Eric Hangen, AICP Alys Mann Table of Contents TABLE OF CONTENTS ............................................................................................................................ 1 EXECUTIVE SUMMARY ......................................................................................................................... 3 KEY FINDINGS .................................................................................................................................................. 3 OVERVIEW – RUTLAND, VERMONT ...................................................................................................... 8 POPULATION & DEMOGRAPHIC TRENDS .............................................................................................. 8 POPULATION ........................................................................................................................................... 9 HOUSEHOLDS .......................................................................................................................................... 9 AGE DISTRIBUTION ................................................................................................................................. 10 RACIAL/ETHNIC DISTRIBUTION .................................................................................................................. 11 ECONOMY & INCOME ........................................................................................................................ 13 MEDIAN INCOME TRENDS ......................................................................................................................... 13 INCOME DISTRIBUTION BY TENURE ............................................................................................................. 13 POVERTY .............................................................................................................................................. 15 UNEMPLOYMENT RATE ............................................................................................................................ 15 EMPLOYMENT TRENDS ............................................................................................................................ 16 HOUSING MARKET TRENDS ................................................................................................................ 17 HOUSING STOCK .................................................................................................................................... 17 NUMBER OF UNITS ......................................................................................................................................... 18 VACANCY RATES AND VACANT BUILDINGS ........................................................................................................... 18 BUILDING PERMIT TRENDS ................................................................................................................................ 19 HOUSING TYPES ............................................................................................................................................. 20 AGE OF HOUSING STOCK .................................................................................................................................. 21 FUEL SOURCE ................................................................................................................................................. 22 RENTAL HOUSING MARKET ...................................................................................................................... 23 AGE OF RENTAL STOCK .................................................................................................................................... 24 RENTAL STOCK UNITS PER STRUCTURE ................................................................................................................ 24 RENTAL VACANCY RATES .................................................................................................................................. 25 SALE PRICE OF MULTIFAMILY PROPERTY .............................................................................................................. 25 RENTS .......................................................................................................................................................... 26 SUBSIDIZED RENTAL STOCK ............................................................................................................................... 27 SUBSIDIZED RENTAL HOUSING PROVIDERS, WAITING LIST DATA AND PROJECTS IN PIPELINE ........................................... 28 RENTAL AFFORDABILITY ................................................................................................................................... 29 RENTAL COST BURDENS .................................................................................................................................. 30 1 PERSPECTIVES OF RENTAL HOUSING MARKET STAKEHOLDERS .................................................................................. 31 HOMEOWNERSHIP & FOR-­‐SALE HOUSING MARKET ....................................................................................... 35 HOMEOWNERSHIP RATE .................................................................................................................................. 36 HOMEOWNERSHIP VACANCY RATE ..................................................................................................................... 36 HOME PRICE TRENDS ....................................................................................................................................... 37 HOMEOWNERSHIP AFFORDABILITY .................................................................................................................... 39 POTENTIAL FIRST-­‐TIME HOMEBUYER MARKET ...................................................................................................... 40 HOMEOWNERSHIP COST BURDENS .................................................................................................................... 41 THE HOME MORTGAGE MARKET ........................................................................................................................ 43 MORTGAGE DELINQUENCIES AND FORECLOSURES ................................................................................................ 44 STAKEHOLDER PERSPECTIVES ON THE FOR-­‐SALE MARKET ........................................................................................ 45 HOUSING FOR THE ELDERLY ...................................................................................................................... 47 AGE DISTRIBUTION OF SENIORS ........................................................................................................................ 47 HOUSING COST BURDEN OF SENIORS ................................................................................................................. 47 DISABILITY STATUS OF SENIORS ......................................................................................................................... 48 AVAILABLE SUBSIDIZED SENIOR RENTAL HOUSING ............................................................................................... 48 OWNER OCCUPIED AGE DISTRIBUTION ................................................................................................................ 49 SPECIAL NEEDS HOUSING ......................................................................................................................... 49 PEOPLE WITH DISABILITIES ............................................................................................................................... 49 HOUSING FOR PEOPLE WITH DISABILITIES ........................................................................................................... 50 RECOMMENDATIONS ......................................................................................................................... 51 IMPLEMENT FOCUSED REVITALIZATION INITIATIVES IN THE NEIGHBORHOODS SURROUNDING DOWNTOWN ................. 51 THE “HEALTHY NEIGHBORHOODS” APPROACH TO REVITALIZATION ......................................................................... 51 SELECT A GEOGRAPHICALLY FOCUSED INVESTMENT AREA, BUILDING FROM STRENGTH RATHER THAN WEAKNESS ............. 52 EMPLOY A NEIGHBORHOOD MARKETING APPROACH ............................................................................................. 53 CONNECT NEIGHBORS TO ONE ANOTHER TO DRIVE REVITALIZATION WORK ................................................................ 55 INCENTIVIZE AND FACILITATE PRIVATE MARKET INVESTMENT .................................................................................. 57 SET OUTCOMES PROPERTY BY PROPERTY; FUND FOCUSED ACQUISITION, REHABILITATION AND RESALE OF KEY, STRATEGIC PROPERTIES ................................................................................................................................................... 58 INVEST IN AND MARKET THE DOWNTOWN AND IN KEY ASSETS AND AMENITIES NEAR THE TARGET AREA .......................... 60 ENCOURAGE AND SUPPORT COMMUNITY DEVELOPMENT NONPROFITS TO REFOCUS THEIR WORK IN WAYS THAT WILL BETTER SPUR NEIGHBORHOOD REVITALIZATION. ............................................................................................................. 60 SUPPORT “BIG PICTURE” PLANNING EFFORTS THAT CAN CHANGE THE CONTEXT IN WHICH WE ARE SEEKING TO REVITALIZE NEIGHBORHOODS ........................................................................................................................................... 61 COST ESTIMATE AND RESOURCES FOR A REVITALIZATION INITIATIVE ......................................................................... 61 USE A TRIAGE APPROACH TO MAXIMIZE IMPACT ON VACANT/BLIGHTED HOUSING ................................................ 63 TACKLE AFFORDABLE HOUSING CHALLENGES HOLISTICALLY AND REGIONALLY ....................................................... 66 APPENDIX .......................................................................................................................................... 69 2 Executive Summary This report looks at two separate but related issues for the City of Rutland. First, it is a housing needs assessment intended to understand housing affordability issues in the community. Second, it is a study of patterns of housing demand and disinvestment in the Rutland region, intended to provide insights into how the City can revitalize struggling neighborhoods. To complete the study, the consultants met with City officials and toured Rutland neighborhoods; interviewed local housing market experts; gathered and analyzed data about housing, demographic, and economic trends in Rutland from federal, state and local data sources; and met with local residents and stakeholders at public meetings to discuss and refine our findings and recommendations. Key findings Key findings from our interviews and analyses are as follows: Population and demographics: •
The City of Rutland has been steadily losing population and households over the past 30 years, with 7,404 households and 16,495 residents as of 2010. Rutland County has grown over the same time period, despite a recent population loss. From 2000 to 2010, the City lost 1 percent of its households while the County gained 1 percent. This disparity suggests that the City of Rutland has not competed well for the location choices of households. •
The baby-­‐boomer generation is creating a significant upswing in the population aged 55 to 64 – an age where households may begin to shift their housing arrangements. The City of Rutland may have opportunities to attract more of this age segment to an “in-­‐town” lifestyle. •
The City (and the Region) is not attracting people from diverse racial or ethnic backgrounds, which affects both the age structure of the population and population loss. Economy and income: •
Household incomes are declining in Rutland, the County and the State, after adjusting for inflation. In the City of Rutland, real incomes declined by 3 percent from the 2000 Census to the 2010 Census. This dynamic exacerbates affordable housing challenges. •
Poverty is concentrated in Rutland and especially in the downtown and northwest Census Tracts – enough so that the concentration of poverty itself may be impacting neighborhood health. The overall poverty rate in Rutland is 16 percent compared to 12 percent for the county; Census Tract 9631 has a poverty rate of 25 percent, which could be considered a high-­‐poverty neighborhood. •
The unemployment has more than doubled since 2000. Unemployment among City of Rutland residents (8.8 percent in 2010) is much higher than for residents of Rutland County (7.3 percent) or Vermont. (6.2 percent) 3 •
The City of Rutland has seen employment grow from 2000-­‐2010, while it contracted in Rutland County and in Vermont. However, while the City of Rutland is an important job center, it actually contributes more to the region’s housing stock than it does to its employment base. Only 25% of jobs in Rutland County are located in the City of Rutland, compared to 28% of households. Housing stock: •
The number of housing units in Rutland actually grew slightly from 2000 to 2010, even though the number of households declined. This mismatch has pushed the overall housing vacancy rate up in Rutland, from 6 percent in 2000 to 8 percent in 2010. Construction permits for new housing have plummeted, which should help the market to correct itself. •
The City of Rutland has a significant amount of old housing stock and small multi-­‐unit stock. About half the stock was built before 1940, and about a third of the stock is in 2-­‐4 unit structures. Older multifamily stock in particular is undervalued relative to single-­‐family housing, and its concentration in certain areas of the city is helping to drive neighborhood revitalization challenges. This stock also creates special needs for housing rehabilitation (such as remediating lead paint hazards). •
The City of Rutland is struggling with a stock of about 152 vacant structures. The highest concentrations of these structures are observed west of Route 7, especially just northwest of downtown Rutland. About one-­‐third of vacant structures are located within 200 feet of an undesirable land use such as a prison, rooming house, high-­‐traffic corridor, industrial area, or flood-­‐
prone area. Rental housing market: •
Much of the rental stock is older and in small buildings, creating both rehabilitation and management challenges. During 2010-­‐Q1 2012, the median 2 to 4 unit property sold for only about $75,000 in the City of Rutland, about 40 percent less than the median single-­‐family property. While much of this price differential may be due to neighborhood effects (multifamily buildings being located in less desirable neighborhoods), the overall very low sale price of these properties suggests that the small multifamily product is simply not something that the market desires. Interviews with landlords confirm this issue. Low property values for this stock also make it nearly impossible for landlords to obtain financing for needed home improvements, as there is no way to stay within the loan-­‐to-­‐value constraints imposed by traditional underwriting. •
Census data puts the rental vacancy rate in Rutland at 7 percent – only slightly above the benchmark for a “healthy” rental market of 6 percent, and lower than the statewide rental vacancy level of 8%. The Census data also shows that rents have increased 14% in the City of Rutland from 2000 to the 2006-­‐2010 period. These indications of relative health in the rental market are strongly contradicted by interview findings, in which most respondents characterized the rental market as stagnant to weak (from an owner’s point of view). 4 •
In Rutland in 2010, just under half (46%) of renter households paid more than a third of their incomes in rent, and over one-­‐fifth (22%) of renters paid more than half of their incomes in rent. After adjusting for inflation, rents have grown over the past decade while incomes have declined – causing the prevalence of cost-­‐burdened renters to increase substantially since 2000. •
Low incomes – more so than high rents – appear to drive the housing cost burden problem. A family earning only 55 percent of the HUD-­‐Adjusted Median Family Income could afford the median rent on a two-­‐bedroom apartment, and rental cost burdens are almost entirely limited to households with annual incomes under $35,000. A comparison of the rent distribution of apartments to the income distribution of renter households further suggests that inadequate apartment supply within an affordable price range mainly affects households earning under $20,000 annually. •
Interviewees see significant challenges in the rental market, including lack of capital for financing purchase and repair, regulatory issues that increase the costs of providing housing, competition between subsidized and private-­‐market rental housing, and declines in tenant quality. Neighborhood effects are also in play, with some neighborhoods near downtown posing particular challenges for owners. •
Subsidized rental housing is strongly concentrated in the City of Rutland. Rutland City accounts for 61% of the County’s subsidized rental housing units, compared to 28% of the County’s households and 25% of its jobs – suggesting a significant imbalance and the need to direct future subsidized housing development to other job centers around the county. On the other hand, the City also may make a convenient location for such housing due to the services and amenities it offers. Homeownership market: •
At 52 percent, the homeownership rate in the City of Rutland is well below county, state, and national levels. Census Tract 9631, northwest of downtown, has a particularly low rate of 29 percent that is influenced by the multifamily stock in that area. •
Home prices have seen a dramatic downwards correction, dropping by 28 percent from the 2006 market peak through 2011 in Rutland. This decline is more than twice the drop experienced in Rutland County (12 percent), underscoring the issues of neighborhood competitiveness that are impacting the health of the city. More recent data from the Realtors® association show continued, moderate price declines, although the Realtors® interviewed for the study uniformly expressed optimism about the direction the market is taking. Sales activity also declined dramatically from the market peak, and continues to be much slower than pre-­‐
crash levels although it has recovered slightly. •
As a result of both the steep declines in prices and record-­‐low interest rates now available, Rutland has become an exceptionally affordable place in which to buy a home. At $112,000, the 5 2011 median house price for Rutland City should be affordable to a household earning approximately $34,250 annually, or 56 percent of the HUD-­‐Adjusted Median Family Income. •
A significant pool of renters exists in Rutland County – we estimate over 1,400 households – that has the savings, debt and income characteristics to qualify for a mortgage and afford a home. Helping these households to navigate the route to homeownership and convincing as many of them as possible to invest in the City of Rutland should form a key component of the City’s revitalization strategy. •
Despite the current affordability of homes, 38 percent of Rutland homeowners are paying over 30 percent of their incomes on housing, and 12 percent are paying over half their incomes – likely reflecting both higher prices paid at the market peak and subsequent shocks to household income during the recession. Mortgage delinquencies have also increased significantly since the onset of the recession – the percentage of 90+ day delinquent loans in Rutland County has gone from 0.8 percent in 2006 to 5.7 percent in 2010. •
Lis Penden filings sharply increased in 2008 and 2010, with 70 and 78 filings, respectively. If the second two quarters of 2012 are similar to the first two quarters, Lis Penden filings may reach between 50 and 60 filings, which is high compared to filings in 2006, 2007, and 2011. There is a concentration of filings in the neighborhoods west of Route 7 between 2006 – Q2 2012. •
Denial rates on mortgages have actually declined slightly from 2006 to 2010, despite the well known tightening of the credit markets. However, lending rates have plummeted, especially for home improvement loans. •
Interviewees knowledgeable about the for sale market generally feel that the market has improved considerably, but that lending constraints (such as requirements for high credit scores and savings levels) are impacting the market. Neighborhood effects were also observed in which certain parts of Rutland have less ability to attract strong homebuyers. Nevertheless, interviewees felt that the City of Rutland has marketing strengths (such as convenience and schools with a strong reputation) that are helping to drive interest among homebuyers. Housing for the elderly: •
Senior populations are expected to increase, and with it demand for senior housing, particularly for younger senior housing. •
Housing cost burdens and disabilities are both important issues affecting senior households (age 65 and over). Forty-­‐five percent of senior renters are housing cost burdened. Forty percent of seniors in Rutland have a disability. People with disabilities: •
The City of Rutland has a high concentration of non-­‐institutionalized people with disabilities, a concentration which is even more elevated in its poorest census tract. 6 7 Overview – Rutland, Vermont The City of Rutland is located in western part of Vermont. It is located within Rutland County and is the economic hub for the area. The City of Rutland is naturally broken into four quadrants by four main roads that dissect the city. These include Route 7, which runs north and south, and route 4 and Woodstock Avenue which run east and west. Rutland has four census tracts that roughly follow along the city’s four quadrants with tract 9632 in the northwest quadrant, 9630 in the northeast quadrant, 9633 in the south and 9631 located near downtown Rutland in the center of the City. Most of the analysis for this market study will focus on the four census tracts within Rutland City, the City as a whole, Rutland County and Vermont. Data sources for the report include the 2000 and 2010 US Census, 2010 American Community 5-­‐year estimates, local Assessor’s office data, State of Vermont property transfer tax data, Realtor® Multiple Listing Service data, and other state government data sources available via www.housingdata.org. Where appropriate, we also include information from a series of interviews conducted with local housing market stakeholders. These stakeholders included two affordable housing providers, three local landlords, and two Realtors®. Population & Demographic Trends Key themes: •
The City of Rutland has been steadily losing population and households over the past 30 years, with 7,404 households and 16,495 residents as of 2010. Rutland County has grown over the same time period, despite a recent Population
70,000
60,000
58,347
63,400
62,142
61,642
50,000
40,000
Rutland City
Rutland County
30,000
20,000
18,436
18,230
1980
1990
17,292
16,495
2000
2010
10,000
0
Year
Source: Vermont Housing Data (www.housingdata.org); US Census
8 population loss. From 2000 to 2010, the City lost 1 percent of its households while the County gained 1 percent. This disparity suggests that the City of Rutland has not competed well for the location choices of households. •
The baby-­‐boomer generation is creating a significant upswing in the population aged 55 to 64 – an age where households may begin to shift their housing arrangements. The City of Rutland may have opportunities to attract more of this age segment to an “in-­‐town” lifestyle. •
The City (and the Region) is not attracting people from diverse backgrounds, which affects both the age structure of the population and population loss. Population As of 2010, the City of Rutland’s population was 16,495. Each year since 1980 the city has lost population. Rutland County and Vermont’s populations have increased since 1980, but the rate of growth is slowing. Only in the last decade has the County lost population. The city has lost population faster than the County every decade for a period of several decades. This data underscore a long-­‐term issue with the competitiveness of Rutland City (relative to elsewhere in Rutland County) for the choices of households deciding where to live. The recent County population loss in the last decade suggests heightened issues with economic competitiveness of the region. Population – Percent Change from 1970 to 2010 1970-­‐1980 1980-­‐1990 1990-­‐2000 2000-­‐2010 Rutland City -­‐4% -­‐1% -­‐5% -­‐5% Rutland County 11% 7% 2% -­‐3% Vermont 11% 10% 8% 3% Source: Vermont Housing Data (www.housingdata.org); US Census The US Census Bureau no longer prepares population projections for states or counties. As of 2000, it had predicted a 1 percent population increase for the period of 2000 to 2010 (compared to the 3 percent decline that was actually observed). These projections had also anticipated a population increase of 1 percent from 2010 to 2020. Given recent economic trends and the age structure of Rutland County, which is strongly skewed towards an older population compared to the age structure nationally, continued population loss is a real possibility unless new development strategies can be identified. Households The number of households has fallen less rapidly in Rutland than the population from 2000 to 2010, meaning that on average, households decreased in size during this period – mimicking a national trend towards smaller households. Note that the number of households in Rutland County actually increased by 1 percent, despite a 3 percent decline in population. Households are the fundamental unit of demand in a housing market; the decline in households in Rutland City has impacted the market by increasing vacancy rates and depressing prices and rents 9 relative to what one would have expected to happen in a market with increasing numbers of households. Note the more rapid decline of households from Census Tracts 9631 and 9632, in the northwest and downtown sections of the city. These more rapid declines are an indicator of potential issues affecting the desirability of these neighborhoods. Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont Number of Households 2000 2010 1,955 1,970 1,713 1,644 1,400 1,356 2,384 2,434 7,452 7,404 25,678 25,984 240,634 256,442 % Change 1% -­‐4% -­‐3% 2% -­‐1% 1% 7% Source: 2000 Census, 2010 Census Age distribution Rutland and Rutland County are substantially older than the United States population as a whole. In Rutland County, 33 percent of the population is between age 45 and 64, compared to 26 percent nationally; 17 percent of the Rutland County population is 65 or older, compared to 13 percent nationally. This dynamic may be a combination both of the racial and ethnic makeup of the local population and/or employment dynamics in which younger workers are not finding opportunities locally. Median Age Rutland City Rutland County Vermont United States 42.9 44.3 41.5 37.2 Source: 2010 Census Population in Rutland appears to be getting increasingly concentrated in middle-­‐aged to pre-­‐retirement-­‐
aged groups, mimicking a statewide trend as the baby boom generation ages. This growing 55 to 64 age bracket is an age where households may begin to shift their housing arrangements – and in particular might seek some of the conveniences of an “in-­‐town” lifestyle that the City of Rutland could conceivably offer. The proportion (and the actual number) of retirement-­‐age population has been growing in the County and the State but shrinking in Rutland City – a surprising result given that not only is the broader population aging, but a City with the conveniences of Rutland might be seen by many older households as a good place to live. Age Distribution Over Time Census 2010 % Change from 2000 to 2010 10 Rutland City 22% 18% 13% 16% 14% 7% 10% 19 and under 20 to 34 35 to 44 45 to 54 55 to 64 65 to 74 75+ Rutland County 22% 17% 12% 17% 16% 9% 8% Vermont 24% 18% 13% 16% 14% 8% 7% Rutland City -­‐13% 0% -­‐21% 17% 58% -­‐7% -­‐5% Rutland County -­‐14% -­‐2% -­‐26% 8% 53% 18% 4% Vermont -­‐12% -­‐2% -­‐25% 6% 54% 18% 10% Source: 2010 Census; 2000 Census Within the next two decades, over a third of their popualtion in Rutland City (34.2%) will reach retirement age and will be faced with caring for an aging population. Rutland City, like Rutland County and Vermont all face an older population as compared ot the United States. Age Distribution in Rutland City
n= 16,495
• 9%
7.9%
8%
7.4%
6.9%
7%
5.9%
6%
5%
8.2%
6.1%
6.5%
6.3%
5.8% 5.8%
5.4% 5.5%
•
•
5.0%
4.4%
4%
3.0%
3%
3.2%
3.6%
2.9%
2%
1%
85+
80 to 84
75 to 79
70 to 74
65 to 69
60 to 64
55 to 59
50 to 54
45 to 49
40 to 44
35 to 39
30 to 34
25 to 29
20 to 24
15 to 19
10 to 14
5 to 9
Under 5
0%
Source: 2010 US Census
Racial/Ethnic Distribution In Rutland County and even in Rutland City, there is not a significant level of racial or ethnic diversity. This may in fact be a marketing weakness given that many people are attracted to the cultural vibrancy and energy that diverse populations bring to cities. Many larger cities have been sustaining themselves with the growth of minority and immigrant populations, sources of growth from which Rutland appears to be cut off. Minority populations also have a much younger age structure, so the lack of racial and ethnic diversity in Rutland also affects the age structure of the population. Race Distribution Geography White Black or African American Asian Ethnic Distribution Other race Two or more races Non-­‐ Hispanic Hispanic 11 Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont 97% 95% 95% 96% 96% 97% 95% 1% 1% 1% 1% 1% 1% 1% 1% 1% 1% 1% 1% 1% 1% 0% 1% 0% 0% 0% 0% 0% 1% 2% 3% 1% 2% 1% 2% 99% 98% 98% 98% 98% 99% 99% 1% 2% 2% 2% 2% 1% 1% Source: 2010 Census In the City of Rutland, renter-­‐occupied households tend to be younger than owner-­‐occupied households. This trend is fairly common because people usually do not purchase a home until they are financially stable and desire to settle down. Roughly 30% of the current owner occupants are age 65 and above. As this segment of the population ages out of their homes there will be an increased opportunity for first-­‐time homebuyers to purchase homes in the City of Rutland – or conversely, potentially increased risk for neighborhoods if those homes are not sold to new homeowners, or at least responsible investor owners. Age Distribution by Tenure
Rutland, Vermont
nte
Re
1065
nts
pa
ccu
r O
1963
559
15-­‐34
35-­‐64
65+
n
Ow
ccu
r O
n
pa
380
ts
2511
1055
e
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Source: 2010 Census
12 Economy & Income Key themes: •
Household incomes are declining in Rutland, the County and the State, after adjusting for inflation. In the City of Rutland, real incomes declined by 3 percent from the 2000 Census to the 2010 Census. This dynamic exacerbates affordable housing challenges. •
Poverty is concentrated in Rutland and especially in the downtown and northwest Census Tracts – enough so that the concentration of poverty itself may be impacting neighborhood health. The overall poverty rate in Rutland is 16 percent compared to 12 percent for the county; Census Tract 9631 has a poverty rate of 25 percent, which could be considered a high-­‐poverty neighborhood. •
The unemployment has more than doubled since 2000. Unemployment among City of Rutland residents (8.8 percent in 2010) is much higher than for residents of Rutland County (7.3 percent) or Vermont. (6.2 percent) •
The City of Rutland has seen employment grow from 2000-­‐2010, while it contracted in Rutland County and in Vermont. However, while the City of Rutland is an important job center, it actually contributes more to the region’s housing stock than it does to its employment base. Only 25% of jobs in Rutland County are located in the City of Rutland, compared to 28% of households. Median income trends After adjusting for inflation, median household income in the City of Rutland decreased 3% from 1999 to 2010. It also decreased in both Rutland County and Vermont by 1% and 2%. This indicates incomes are stagnating and losing ground in Rutland City, Rutland County, and Vermont after adjusting for inflation. As we discuss later on, rents have risen faster than incomes, creating affordable housing challenges for many renters. Median Income from 1979 to 2009 -­‐ adjusted to 2010 dollars 2006-­‐
1979 1989 1999 2010 Rutland City $62,370 $44,001 $39,317 $38,108 Rutland County $43,704 $48,836 $47,398 $47,027 Vermont $43,778 $51,540 $52,704 $51,841 % Change 1979-­‐
1989-­‐
1989 1999 -­‐29% -­‐11% 12% -­‐3% 18% 2% 1999-­‐
2010 -­‐3% -­‐1% -­‐2% Source: Vermont Housing Data (www.housingdata.org); US Census Income distribution by Tenure A signification number of rental households, 64%, earn under $35,000 a year, while only 30% of the owner occupied population earns under $35,000. 13 00
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Income Distribution of Renter Households
17%
16%
13%
15%
11%
9%
8%
6%
4%
3%
2%
0%
0%
0%
Source: ACS 2006-­‐2010 5 year estimates
4%
Source: ACS 2006-­‐2010 5 year estimates
Income Distribution of Owner Occupied Households
25%
21%
19%
15%
10%
11%
7%
5%
2%
4%
0%
14 Poverty Poverty is somewhat concentrated in Rutland City and very concentrated in the city center and northwest quadrant, where 25% and 19% of the Poverty Status population lives below the poverty level. These Total % Below Population Poverty levels approach what community development Level researchers have termed “high-­‐poverty Census Tract 9630 4,254 13% neighborhoods.” Researchers have found that Census Tract 9631 3,426 25% high-­‐poverty neighborhoods exert significant Census Tract 9632 3,168 19% “neighborhood effects” that impact school Census Tract 9633 5,227 11% performance even of non-­‐poor children, Rutland C
ity 16,075 16% employment chances for residents of such Rutland County 59,622 12% neighborhoods, crime rates, health outcomes, Vermont 600,114 11% local government costs, reduced private sector Source: ACS 2006-­‐2010 5 year estimates investment, and other factors.1 Unemployment rate Unemployment rates are substantially higher in Rutland City than in the County and higher still than for Vermont. This data again suggest both regional economic challenges for the greater Rutland area, as well as the concentration of less well-­‐off households within the City. 1
“High poverty” neighborhoods are often defined as neighborhoods with a poverty rate of 20% or greater; neighborhoods with a poverty rate of 40% or greater are often termed “extreme poverty” neighborhoods. For a discussion of high poverty neighborhoods and their effects, see: Kneebone, Nadeau and Berube (2011). “The Re-­‐Emergence of Concentrated Poverty: Metropolitan Trends in the 2000s.” Brookings Institution, Metropolitan Opportunity Series. Available on the internet at: http://www.brookings.edu/~/media/research/files/papers/2011/11/03%20poverty%20kneebo
ne%20nadeau%20berube/1103_poverty_kneebone_nadeau_berube.pdf 15 Unemployment Rate
12.00%
10.00%
8.00%
6.00%
4.00%
2.00%
0.00%
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Year
Rutland City
Rutland County
Vermont
Source: Vermont Housing Data (www.housingdata.org); Vermont Department of Labor
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Unemployment Rate Rutland City Rutland County 3.00% 3.20% 3.60% 3.80% 3.20% 3.60% 4.50% 5% 6.10% 9.80% 8.80% 3.00% 3.50% 4.10% 4.90% 4.10% 3.70% 4% 4.30% 5.30% 8.30% 7.30% Vermont 2.70% 3.30% 4.00% 4.50% 3.70% 3.50% 3.70% 3.90% 4.50% 6.90% 6.20% Source: Vermont Housing Data (www.housingdata.org) Vermont Department of Labor Employment Trends The City of Rutland has experienced stronger job growth than the County or the State during the past decade (although in raw number terms the job growth has been modest). Note that while the City of Rutland is an important job center, it actually contributes more to the region’s 16 housing stock than it does to its employment base. Only 25% of jobs in Rutland County are located in the City of Rutland, compared to 28% of households. Total Number of Jobs 2000 2010 % Change Rutland City 12,930 13,451 4% Rutland County 28,930 27,441 -­‐5% Vermont 296,468 293,088 -­‐1% Source: VT Department of Labor, Covered Employment & Wage Series The majority of jobs in the region appear to be in non-­‐basic sectors of the economy. – particularly in health care and social assistance, retail, and government. Manufacturing and hospitality together make up only 18 percent of jobs. Employment by Industry, Rutland City 1988 Health Care & Social Assistance 18% Retail 17% Government 10% Manufacturing 13% Leisure & Hospitality 8% Professional & Business Services 6% Financial Services 7% All Other 21% 2011 29% 13% 14% 10% 8% 8% 4% 14% Source: VT Department of Labor, Covered Employment & Wage Series Housing Market Trends Housing Stock Key themes: •
The number of housing units in Rutland actually grew slightly from 2000 to 2010, even though the number of households declined. This disparity impacts the market housing vacancy rate. Construction permits for new housing have plummeted, which should help the market to correct itself. •
The City of Rutland has a significant amount of old housing stock and small multi-­‐unit stock. About half the stock was built before 1940, and about a third of the stock is in 2-­‐4 unit structures. This stock is undervalued relative to single-­‐family housing, and its concentration in certain areas of the 17 city is helping to drive neighborhood revitalization challenges. This stock also creates special needs for housing rehabilitation (such as remediating lead paint hazards). •
The City of Rutland is struggling with a stock of about 152 vacant structures. The highest concentrations of these structures are observed west of Route 7, especially just northwest of downtown Rutland. About one-­‐third of vacant structures are located within 200 feet of an undesirable land use such as a prison, rooming house, high-­‐traffic corridor, industrial area, or flood-­‐
prone area. Number of units Overall, the number of housing units in the City of Rutland has remained fairly constant from 2000 to 2010, while there has been some growth in Rutland County and sizable growth in Vermont. Census Tract 9633, the southern area of Rutland City, saw growth comparable to Rutland County, while the neighborhoods in the center of the city and northwest quadrant remained unchanged. Note that the expansion of housing stock from 2000 to 2010 in a market where the number of households declined affects the market vacancy rate. Indeed, the overall housing vacancy rate in Rutland City increased from 6 percent in 2000 to 8 percent in 2010. Number of Housing Units 2000 2010 % Change Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont 2,050 2,092 1,827 1,825 1,481 1,483 2,561 2,682 7,919 8,082 32,311 33,768 294,382 322,539 2% 0% 0% 5% 2% 5% 10% Source: 2010 US Census, 2000 US Census Vacancy rates and vacant buildings One of the major community development issues facing the City of Rutland is the presence of vacant buildings (see Appendix I for “Vacant Structure and Land Use Map”). As of January 2012, the City reports 152 vacant buildings as well as 192 parcels of vacant land. As can be seen in the map, there are vacant buildings throughout the city, but higher concentrations in the western neighborhoods, especially just northwest of downtown. A visual inspection of the vacant building stock, conducted by the consultants in May 2012, also showed that vacant buildings tend to be in much worse condition in western sections of the city, particularly in the areas just north of downtown Rutland, and to a lesser extent in the southwestern quadrant (known popularly as “the Gut” or “Happy Valley”). Proximity to undesirable land uses or other disamenities – such as prisons, rooming houses, industrial uses, high-­‐traffic corridors, and flood-­‐prone areas – may also be driving part of the vacancy issue. About 1/5 of vacant structures in Rutland (30 out of 152) are located within 200 feet of these disamenities (see 18 Appendix I for “Vacant Structures and Undesirable Land Use” map). However, many participants in the first public meeting commented that the jail, in particular, may not have a significant effect on neighboring property values – at least not an effect that crosses east of East Creek, or if it does, an effect that is masked by the positive effect of nearby amenities such as Pine Hill park. An appraiser present at the meeting also stated that his firm has been unable to detect a negative effect of many disamenities (including the jail) when conducting statistical analyses, although he agreed that such a negative effect would be expected. Vacancy rates for rental and homeownership stock are discussed in more detail later in this report, but we present overall vacancy data here from the 2010 Census. Note that the high rate of “vacant” housing in Rutland County is a reflection of the large number of second homes held for seasonal use. These seasonal homes are themselves an important factor in the housing market dynamics of the region. Geography Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont Rutland Occupancy Status Total Total % Housing Occupied Occupied Units 2,092 1,970 94% 1,825 1,644 90% 1,483 1,356 91% 2,682 2,434 91% 8,082 7,404 92% 33,768 25,984 77% 322,539 256,442 80% Total Vacant 122 181 127 248 678 7,784 66,097 % Vacant 6% 10% 9% 9% 8% 23% 20% Source: 2010 Census Geography Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont Total Vacant 122 181 127 248 678 7,784 66,097 For Rent 31% 45% 34% 49% 42% 9% 9% Vacant Reason Rent -­‐ Sold -­‐ Not Not For Sale Occupied Occupied 2% 15% 5% 0% 10% 1% 0% 9% 4% 2% 14% 2% 1% 12% 3% 2% 5% 1% 1% 5% 1% Seasonal 25% 7% 17% 11% 13% 74% 76% Vacant Other 22% 38% 37% 21% 29% 9% 8% Source: 2010 Census Building permit trends The number of building permits being pulled in the City of Rutland decreased 50% between 2007 and 2008 and has remained low each year since then. Rutland County is experiencing the same general 19 trend, probably as a result of the economic recession, the weakening housing market, and difficulty in accessing capital for new construction. Building Permit Estimates with Imputation (Total Units) Rutland City Number % Change of Permits 1998 2 Rutland County Number % Change of Permits 104 1999 2000 9 16 350% 78% 130 135 25% 4% 2001 15 -­‐6% 114 -­‐16% 2002 16 7% 171 50% 2003 2004 16 17 0% 6% 138 165 -­‐19% 20% 2005 15 -­‐12% 169 2% 2006 2007 14 10 -­‐7% -­‐29% 123 78 -­‐27% -­‐37% 2008 5 -­‐50% 73 -­‐6% 2009 2010 3 6 -­‐40% 100% 43 56 -­‐41% 30% 2011 4 -­‐33% 36 -­‐36% Source: US Census Bureau Housing Types The City of Rutland has a diversity of housing types which can accommodate a diversity of family types and sizes. The predominate housing type is the single unit home, but there are also a substantial number of 2 unit, 3 or 4 unit, and 5 to 9 unit buildings. Rutland City offers a variety of structure types including apartment buildings that are not as common in Rutland County or Vermont. This stock can be used to attract people looking for a more urban lifestyle. (See Appendix I for “Land Use Map”). At the same time, multiunit housing (particularly 2 to 4 unit housing) is valued at much lower prices than single-­‐family stock, as we discuss in more detail later in this report. The concentration of multiunit housing in particular neighborhoods may thus be playing a role in neighborhood revitalization challenges. Units by Structure Type Census Tract 9630 Census Tract 9631 Census Tract 9632 1, 1, detached attached 73% 2% 24% 1% 48% 1% 2 12% 18% 22% 3 or 4 6% 26% 19% 5 to 10 to 20 to 50 or 9 19 49 more 1% 3% 1% 2% 17% 4% 4% 6% 9% 1% 0% 0% Mobile home 1% 1% 1% 20 Census Tract 9633 City of Rutland County of Rutland Vermont 37% 45% 64% 66% 2% 2% 1% 3% 26% 19% 11% 7% 11% 15% 7% 7% 11% 10% 4% 5% 2% 3% 2% 2% 1% 2% 1% 2% 2% 2% 1% 1% 8% 3% 8% 7% Source: ACS 2006-­‐2010 5 year estimates Age of housing stock The City of Rutland has a very significant prewar housing stock, especially near downtown and in the northwest quadrant of the city. This stock could be one of the great marketing strengths of Rutland, if it is well cared for and revitalized. However, to the extent that it has been neglected and cut up into small rental units, the old housing stock has instead become a marketing liability. An older housing stock also requires more routine maintenance and remediation of lead paint and other issues, making rehab work more costly. Ensuring adequate financing availability to support rehabilitation of this stock is thus an important goal. Age of Housing Stock Census Tract 9630 Census Tract 9631 Built Built Built 2005 2000 1990 and to to later 2004 1999 0% 3% 4% 0% 0% 2% Built Built Built 1980 1970 1960 to to to 1989 1979 1969 8% 10% 12% 5% 4% 10% Built 1950 to 1959 17% 6% Built Built 1940 1939 to or 1949 earlier 8% 38% 9% 64% Census Tract 9632 0% 4% 1% 7% 10% 11% 10% 8% 49% Census Tract 9633 2% 5% 4% 10% 7% 7% 11% 7% 48% Rutland City Rutland County 1% 1% 3% 4% 3% 8% 8% 17% 8% 16% 10% 9% 11% 7% 8% 4% 49% 33% Vermont 2% 5% 11% 17% 16% 9% 7% 4% 29%` Source: ACS 2006-­‐2010 5 year estimates One of our interviewees described the issues with deteriorated older housing stock, particularly in neighborhoods to the west of Route 7: A lot of the City was developed in the second half of the 19th century – a lot of large homes, densely built, that are too large for today’s families and too expensive as a single-­‐family home. The nicest ones are still single-­‐family but many have been cut up into apartments, a process driven by the private market. You have 2-­‐story, 2,500 square foot buildings cut into 4 or more apartments with the theory that the more apartments, the more income you can get, and the fewer kids and regulations. [Investor-­‐owners have] chopped the buildings up and made them unattractive, and the structural components of the building are not being addressed. Then you get the crisis now – the quality is so substandard that people are living in unhealthy and unsafe conditions. 21 The interviewee continued with comments about the quality of this stock as originally built and some neighborhood differences between the southwestern section (the Gut / Happy Valley) and the northwestern section around Baxter Street: The neighborhoods to the west of Route 7 are older stock – everything I have seen was originally well built – marble foundations, architectural details, built between 1880-­‐1930 in my experience. South of West Street was predominantly single family homes for neighborhood factory workers. There are still homeowners there. The northwest sector had larger homes – there are fewer of the original owner-­‐occupants owners there, with more homes converted to multifamily with absentee landlords. Fuel source The most used fuel source in the City of Rutland is fuel oil and/or kerosene. There is virtually no utility heating, even in Rutland City -­‐ meaning that 1) households are not able to take advantage of lower prices for natural gas that are in effect currently, and 2) thermal energy efficiency efforts are not easily coordinated through utilities. Home Heating Source Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont Utility gas Bottled Fuel oil, tank, or Electric kerosene LP gas Coal or coke Wood Solar energy Other fuel No fuel used 1% 9% 7% 81% 0% 2% 0% 0% 0% 1% 6% 12% 76% 0% 2% 0% 3% 0% 1% 7% 1% 86% 0% 4% 0% 1% 0% 2% 20% 3% 68% 0% 2% 0% 1% 3% 1% 1% 11% 13% 6% 4% 77% 68% 0% 0% 2% 12% 0% 0% 1% 1% 1% 0% 15% 15% 4% 52% 0% 13% 0% 1% 0% Source: ACS 2006-­‐2010 5 year estimates 22 Rental Housing Market Key themes: •
Much of the rental stock is older and in small buildings, creating both rehabilitation and management challenges. During 2010-­‐Q1 2012, the median 2 to 4 unit property sold for only about $75,000 in the City of Rutland, about 40 percent less than the median single-­‐family property. While much of this price differential may be due to neighborhood effects (multifamily buildings being located in less desirable neighborhoods), the overall very low sale price of these properties suggests that the small multifamily product is simply not something that the market desires. Interviews with landlords confirm this issue. Low property values for this stock also make it nearly impossible for landlords to obtain financing for needed home improvements, as there is no way to stay within the loan-­‐to-­‐value constraints imposed by traditional underwriting. •
Census data puts the rental vacancy rate in Rutland at 7 percent – only slightly above the benchmark for a “healthy” rental market of 6 percent, and lower than the statewide rental vacancy level of 8%. The Census data also shows that rents have increased 14% in the City of Rutland from 2000 to the 2006-­‐2010 period. These indications of relative health in the rental market are strongly contradicted by interview findings, in which most respondents characterized the rental market as stagnant to weak (from an owner’s point of view). •
In Rutland in 2010, just under half (46%) of renter households paid more than a third of their incomes in rent, and over one-­‐fifth (22%) of renters paid more than half of their incomes in rent. After adjusting for inflation, rents have grown over the past decade while incomes have declined – causing the prevalence of cost-­‐burdened renters to increase substantially since 2000. •
Low incomes – more so than high rents – appear to drive the housing cost burden problem. A family earning only 55 percent of the HUD-­‐Adjusted Median Family Income could afford the median rent on a two-­‐bedroom apartment, and rental cost burdens are almost entirely limited to households with annual incomes under $35,000. A comparison of the rent distribution of apartments to the income distribution of renter households further suggests that inadequate apartment supply within an affordable price range mainly affects households earning under $20,000 annually. •
Interviewees see significant challenges in the rental market, including lack of capital for financing purchase and repair, regulatory issues that increase the costs of providing housing, competition between subsidized and private-­‐market rental housing, and declines in tenant quality. Neighborhood effects are also in play, with some neighborhoods near downtown posing particular challenges for owners. •
Subsidized rental housing is strongly concentrated in the City of Rutland. Rutland City accounts for 61% of the County’s subsidized rental housing units, compared to 28% of the County’s households and 25% of its jobs – suggesting a significant imbalance and the need to direct future subsidized housing development to other job centers around the county. On the other 23 hand, the City also may make a convenient location for such housing due to the services and amenities it offers. Age of rental stock In the City of Rutland, over half the rental stock was constructed prior to 1939 and 90% were constructed prior to 1979. This is comparable to Rutland County and Vermont. Such an aged rental stock could need significant maintenance and rehabilitation. It is often difficult for landlords to gain access to the financing to enable them to make the necessary repairs. Age of Rental Housing Stock Total Units Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont 492 1,235 603 1,257 3,587 7910 73,450 Built Built Built Built Built Built Built Built Built 2005 2000 1990 1980 1970 1960 1950 1940 1939 or to to to to to to to or later 2004 1999 1989 1979 1969 1959 1949 earlier 0% 6% 3% 0% 9% 19% 26% 0% 37% 0% 0% 2% 7% 5% 13% 6% 10% 57% 0% 1% 0% 0% 23% 9% 7% 8% 53% 3% 5% 2% 8% 7% 7% 12% 8% 49% 1% 3% 2% 5% 9% 11% 11% 8% 51% 1% 3% 4% 10% 15% 9% 9% 6% 43% 2% 4% 7% 12% 14% 8% 7% 5% 40% Source: ACS 2010 5 year estimates Rental stock units per structure Many rental units in Rutland City are in one to four unit structures, meaning that large owners must contend with scattered-­‐site management and that many “mom and pop” small landlords can enter the industry. A large number of 1 and 2 family homes in the city – 480 single-­‐family homes and 334 two-­‐
family homes as of 2012 -­‐ are not owned-­‐occupied (see Appendix I for map of “Investor Owned Single and Two Family Homes”). These homes are good candidates to monitor for potential conversion to owner-­‐occupied housing, as part of a broader revitalization strategy. Rental Occupied Units by Structure Type Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 16% 2% 36% 18% 4% 10 to 19 12% 0% 0% 19% 37% 24% 6% 6% 8% 0% 1% 0% 34% 42% 21% 1% 0% 0% 0% 14% 2% 32% 18% 22% 5% 2% 3% 2% 1, 1, detached attached 2 3 or 4 5 to 9 20 50 or Mobile to more home 49 3% 9% 0% 24 City of Rutland County of Rutland Vermont 8% 1% 28% 29% 20% 5% 3% 5% 1% 19% 1% 25% 23% 14% 6% 3% 3% 6% 23% 3% 17% 21% 16% 5% 5% 5% 5% Source: ACS 2010 5 year estimates Rental vacancy rates The rental vacancy rate in Rutland is reasonably healthy to slightly soft at 7percent. It has weakened from a vacancy rate of 5 percent in 2000. The southern part of Rutland in Census Tract 9633 has the highest rental vacancy rate at 9 percent. Rental Vacancy Rate Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont Total Rental Units (Rental Occupied and Vacant Rental) Vacant Units For Rent 593 1245 621 1379 3838 8641 71,732 Rental Vacancy Rate 38 81 43 122 284 676 6% 7% 7% 9% 7% 8% 8% 5,635
Source: 2010 Census Sale price of multifamily property Data from the City of Rutland Assessor shows that 2 to 4 unit homes in the City of Rutland have sold for substantially less money than single-­‐family homes, despite the fact that they offer more units of housing. While much of this price differential may be due to neighborhood effects (multifamily buildings being located in less desirable neighborhoods), the overall very low sale price of these properties suggests that the small multifamily product is simply not something that the market desires. Interviews with landlords confirm this issue. Low property values for this stock also make it nearly impossible for landlords to obtain financing for needed home improvements, as there is no way to stay within the loan-­‐to-­‐value constraints imposed by traditional underwriting. Single Family Homes 2 to 4 Unit Homes Home Sale Prices: 2010 to Q1 2012 Number of Average Median Sales Median Price Sales Sales Price Price per Unit 210 49 129,604 89,710 125,000 75,000 125,000 34,170 25 Apartments 5+ Units 6 184,833 137,000 27,400 Source: City of Rutland Assessor's Data Rents The American Community Survey, HUD Fair Market Rents, and a recent rental market study performed for a new rental development in Rutland (the Hickory Street market study) all indicate that rents within Rutland generally range between $600 and $800 month for one-­‐bedroom units and $650-­‐900 for two-­‐
bedroom units. These rent levels were corroborated in interviews with owners of both subsidized and market rate rental housing. Three-­‐bedroom units appear to be able to command a rent of around $1,000 per month. One Bedroom HUD Fair Market Rents, 2012 $734/month Two Bedroom $853/month Three Bedroom $1,128/month Median Area Market Rent $650 Area Market Rents $550 -­‐ $800 including heat/hot water $650 -­‐ $900 including heat/hot water $775 Source: Housing Urban Development, Hickory Street Market Study Gross Rent as a Percentage of Median Household Income 1980 1990 2000 Rutland City 11% 20% 19% Rutland County 16% 18% 17% Vermont 16% 17% 16% Median Gross Rent Census Tract 9630 $ 752 Census Tract 9631 $ 685 Census Tract 9632 $ 780 Census Tract 9633 $ 718 Rutland City $ 723 Rutland County $ 727 Vermont $ 809 Source: ACS 2006-­‐2010 5 year estimates 2010 23% 19% 19% Source: Vermont Housing Data (www.housingdata.org); US Census In Rutland City, median gross rent as a percentage of median household income was 23% in 2010, which is up from 19% a decade earlier -­‐ indicating rents have risen faster than incomes. The same is true for Rutland County and Vermont. Median Gross Rent from 1980 to 2010 adjusted to 2010 dollars Rutland City 1980 $595 1990 $734 2000 $634 2006-­‐
2010 $723 % Change 1980 to 1990 1990 to 2000 2000 to 2006-­‐2010 23% -­‐14% 14% 26 Rutland County $595 Vermont $598 $734 $744 $654 $700 $727 $809 23% 24% Median Income from 1979 to 2010 adjusted to 2010 dollars 1979 Rutland City $62,370 Rutland County $43,704 Vermont $43,778 1989 1999 2006-­‐
2010 $44,001 $39,317 $38,108 $48,836 $47,398 $47,027 $51,540 $52,704 $51,841 -­‐11% -­‐6% 11% 16% % Change 1979 to 1989 1989 to 1999 1999 to 2006-­‐2010 -­‐29% 12% 18% -­‐11% -­‐3% 2% -­‐3% -­‐1% -­‐2% Source: Vermont Housing Data (www.housingdata.org); US Census Rents would appear to provide a relatively low margin to investor owners, at least in some cases. In interviews with landlords, they estimated market per-­‐unit, per-­‐year operating expenses for rental property at approximately $4,000. For a median 1-­‐bedroom property charging $650 per month in rent and experiencing a 10 percent loss for vacancy and collections, the effective gross income would be about $7,000. After operating expenses, Net Operating Income – the amount that the landlord has to make mortgage payments and for their own return on investment -­‐ would be only $3,000. Even if the landlord decided to forego all return on the property, s/he would only be able to afford a $250 monthly mortgage payment. Subsidized rental stock According to the Directory of Affordable Rental Housing, there are a total of 801 subsidized rental units in Rutland City, such that 21% of all rental units are subsidized. This is a very large portion of the rental market share. A total of 1,309 subsidized units are within Rutland County accounting for 15% of the total market share. Market Share of Subsidized Rental Units Rutland County Rutland City Vermont Number of Rental Units 8641 3838 71732 Number of Subsidized Rental Units 1309 801 13235 Market Share of Subsidized Units 15% 21% 18% Source: Directory of Affordable Rental Housing (DoARH), www.housingdata.org, 2010 US Census Subsidized housing is arguably over-­‐concentrated in Rutland City. Ideally, the geographic distribution of subsidized housing in a region would mirror the distribution of jobs and households, so as to maximize fair housing choice for the users of such housing. Rutland City accounts for 61% of the County’s subsidized rental housing units, compared to 28% of the County’s households and 25% of its jobs – suggesting a significant imbalance and the need to direct future subsidized housing development to 27 other job centers around the county. On the other hand, the City also may make a convenient location for such housing due to the services and amenities it offers. Job & Subsidized Housing Comparison Number Employed Number of as of May Subsidized 2012 Housing Units Rutland City 8,000 801 Rutland County 31,550 1,309 % of City within the County 25% 61% Source: DoRAH, Vermont Department of Labor Subsidized rental housing providers, waiting list data and projects in pipeline Two of the largest providers of subsidized rental housing in Rutland are the Rutland Housing Authority and the Housing Trust of Rutland County. The Rutland Housing Authority generally provides housing for very-­‐low-­‐income households earning at or below 30 percent of the Area Median Income. It builds and manages public housing and administers a Housing Choice Voucher (Section 8) program providing rental assistance to low-­‐income renters. It has 172 units of traditional public housing in 3 properties. It recently developed an additional 14 public housing units in a 33-­‐unit mixed-­‐finance project, and is planning to build an additional 23-­‐unit mixed finance project including 6 public housing units. Both of these projects are part of the redevelopment of its Forest Park public housing site, now being called Hickory Street. Lease-­‐up time was fastest for one-­‐ and two-­‐bedroom units. The Housing Authority reports that the first phase of its Hickory Street work has had strong lease-­‐up performance not only for the public housing units but also for less heavily subsidized and market-­‐rate units. The Housing Authority reports a 3-­‐year waiting list for its Housing Choice Voucher (Section 8) program. It has decided not to take any additional applications until its waiting list is reduced to below 2 years. The Housing Trust of Rutland County has a portfolio of 214 affordable rental units, 125 of which (58 percent) are located in the City of Rutland. The organization reports strong occupancy performance with a 1 percent vacancy rate portfolio-­‐wide as of May 2012, an indicator of the strong demand for its housing. The organization reports a long waiting list for more heavily subsidized units, with the longest list for 1-­‐bedroom, non age-­‐restricted units. It reports a shorter waiting list for less heavily subsidized units such as its Low-­‐Income Housing Tax Credit properties, which tend to serve a relatively narrow income band between 50 to 60 percent of Area Median Income. The Housing Trust has generally refrained from developing additional projects in Rutland for the past several years, responding to local government concerns about whether Rutland needs to expand its housing stock. It does have one project in the pipeline, the conversion of a former school to 15 units of 1-­‐bedroom apartments serving an elderly population. 28 Based on their experiences, subsidized rental housing providers believe that there are unmet housing needs for some specific populations in the Rutland area, most of which involve not only providing housing but supportive services as well: •
Service-­‐supported transitional housing for ex-­‐offenders •
People with mental health needs and disabilities •
Youth in transition (ages 16-­‐22) •
Service-­‐enriched housing for the elderly Rental affordability When comparing the income required to afford a two bedroom apartment in Rutland to the HUD Adjusted Median Household Income for a Family of Four (HAMFI), rents appear to be quite affordable. In both 2010 and 2011 a family earning 55% of the HAMFI would be able to afford the median rent on a two bedroom apartment. Income Needed to Afford an Apartment at HUD's FMR, 2 Bedroom Unit with Median Household Income Rutland City/County Vermont Year 2009 2010 2011 Median Household Income of Renters Income to Afford 2 Br Unit $31,520 $31,760 $34,040 $26,924 $27,038 HUD Adjusted Median Income to Household Afford 2 Br Income for Unit Family of Four $58,500 $59,300 $60,800 Median Household Income of Renters $36,550 $36,809 $39,596 $29,561 $29,580 HUD Adjusted Median Household Income for Family of Four $64,800 $64,400 $66,700 Source: Vermont Housing Data (www.housingdata.org); ACS 2006-­‐2010 5 year estimates Rental affordability challenges are most acute for the lowest-­‐income renters. For renters earning less than $20,000 a year, there is a shortage of 764 affordable units. The need for affordable rental units exists where household income is very low and can be pointing to an “income problem” as much as an affordable housing problem. Number of Affordable Rental Units by Income, Rutland City Rental Units Income Rental Households Considered Affordable* Less than $5,000 $5,000 to $9,999 $10,000 to $14,999 $15,000 to $19,999 $20,000 to $24,999 155 326 473 373 384 16 153 209 185 452 29 $25,000 to $34,999 $35,000 to $49,999 $50,000 to $74,999 $75,000 to $99,999 $100,000 to $149,999 $150,000 or more 603 603 522 125 12 11 1138 1202 21 29 0 0 *Assuming rent is affordable at 30% of income. 182 Units are not cash rent Source: ACS 2006-­‐2010 5 year estimates Rental Cost Burdens Rental cost burdens are widely prevalent throughout Vermont, and Rutland is no exception. In 2010, some 46 percent of renters in Rutland (compared to 43 percent in Rutland County and 47 percent in Vermont) paid more than 30 percent of their incomes for housing. Within the City of Rutland, cost burdens are most prevalent in Census Tracts 9631 and 9632, the areas near downtown and in the northwest quadrant of the City that also house most of its low-­‐income population. Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont Gross Rent as a Percentage of Household Income Severely Cost Burdened Renters Cost Burdened Renters (30%-­‐49%) (50%+) Total Units Total Number Percentage of Total Number Percentage of of Renters Renters of Renters Renters 492 55 11% 163 33% 1,235 303 25% 378 31% 603 198 33% 163 27% 1,257 319 25% 103 8% 3,587 875 24% 807 22% 7,910 1,900 24% 1,524 19% 73,450 18,399 25% 16,485 22% Source: ACS 2006-­‐2010 5 year estimates Looking at the issue of rental cost burdens more closely, we see that cost burdens are substantially more prevalent in 2010 than they were in the 2000 Census. We also see that cost burdens continue to be concentrated among low-­‐income renters earning less than $35,000 per year (by comparison, the HUD-­‐Adjusted Median Family Income for a family of four in 2010 was $59,300). The problem of cost-­‐
burdened households is a regional challenge, not just a local one, and is as much as a function of income as of housing costs. Solving this challenge is likely to require some combination of making units affordable for very-­‐low-­‐income households throughout the region, as well as efforts to connect low-­‐
income households to training and employment opportunities to raise their incomes. Household Income by Median Gross Rent as a Percentage of Household Income %Cost Burdened (30% of more) 1999 Household 1999 Household 2010 Household 2010 Household Income $35,000 Income $35,000 Income $35,000 Income $35,000 and under and over and under and over 30 Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont 48% 60% 77% 51% 58% 54% 54% 11% 0% 4% 0% 3% 2% 4% 46% 74% 90% 65% 69% 65% 70% 39% 3% 10% 2% 7% 9% 19% Source: 2000 Census, 2006-­‐2010 ACS 5 year estimates Age of Householder by Gross Rent as a Percentage of Household Income % of cost burdened households age 15-­‐24 Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont 0% 53% 100% 33% 43% 44% 61% % of cost % of cost burdened burdened households age households age 25-­‐34 35-­‐64 74% 55% 79% 13% 43% 42% 45% 58% 60% 49% 37% 49% 43% 45% % of cost burdened households age 65+ 25% 44% 68% 48% 45% 44% 47% Source: ACS 2006-­‐2010 5 year estimates Perspectives of rental housing market stakeholders The consultants interviewed 3 private-­‐sector landlords and 2 subsidized rental housing providers to gain their perspectives on the rental housing market. The following themes emerged from these interviews: •
Private-­‐sector stakeholders see the current rental market as generally weak. Quotes illustrating this theme included the following: o
The market is extremely weak – vacancies are high; I haven’t lowered rents but have had to wait several months to fill units. o
There have been no rent increases in the past 3-­‐4 years. The vacancy rate is about the same for me, under 5 percent. My problem is collections – people who go delinquent on their rent. o
Right now I would say the capitalization rate is easily 13 to 15 percent because the risk is so high. I am looking to make a 25 to 40 percent return on investment because there is no capital, there is no one taking these houses, and the tenant quality is so low. [The 31 capitalization rate is used to value rental property and represents the blended returns that debt and equity investors seek to make from a property] o
•
•
•
A subsidized housing provider also noted that “what it costs us for operations costs is on the upper end of what the market will bear.” Speculative investment in the rental housing market was commonplace but is now drying up, fueling part of the vacant building problem o
And then you have the vacant building problem. What made things fall apart fast is that when the market was good, there was one Realtor who did a lot of online real estate sales to investors – from CA, out of state. Other people who were born here and moved held on to a big stock, then fell into troubles. So you had a lot of properties coming on the market as old owners abandoned them – those properties still sit there today. o
There are a fair number of abandoned properties that were purchased out of state by people from CT, NY, NJ, even California. You think you’re getting a bargain because you are buying a 2-­‐unit for $80,000 to $100,000 and in Boston it’s $500,000. o
Prices on multifamily rentals are plummeting. There is no one waiting in line to buy these. o
The small owners are going to get out [of the market]. Anyone who bought in the past 8 years paid too much, and their tenant base which is low quality o
More small landlords are getting out of the business. You are always reporting [to regulators] – being a landlord is not as easy as it used to be. o
On the other hand, a Realtor® stated that “we were not seeing a lot of interest in investment property, but now we are seeing people investing again and perceiving a good return. Things are moving. Once some of the inventory is off the market you are going to see some prices going up.” Issues with both aged housing stock and tenant quality are impacting the market o
There is a housing stock problem in terms of quality of the housing – a lot of the stock is old. There are no apartment complexes around here. I have a waiting list of professional people who want to rent but I don’t have the inventory to give them. o
The quality of tenant has really changed over the past 5 years. For example, I have had 20 calls today from prospective tenants and maybe 3 out of 20 were even remotely qualified to get an apartment. The rest are on some kind of social assistance that is not enough. Subsidized rental housing is seen as negatively affecting the performance of market-­‐rate rental housing, among the private landlords interviewed. 32 •
•
o
The [subsidized] rents are competing directly with landlords in Rutland o
The private sector is in competition with the nonprofits – the Land Trust and the Housing Authority. It is killing us. They have a lot of money and become the biggest landlords in town. They can invest lots of dollars in high-­‐end construction. o
[Subsidized housing providers] can get grants and government loans and develop 9 units that cost $2 million, and they pay no tax. o
Tenant quality is not the best because [landlords] can’t compete with the Land Trust. Tax burdens and tenant-­‐landlord law are seen as significantly impacting the performance of rental housing o
The City of Rutland appraised at the peak. There are houses where a 2-­‐family is appraised at $140k and you couldn’t sell it for $40k yet. And landlords do not have the resources to appeal their taxes, they get behind, and they can’t make it. I appeal my taxes for every new purchase I make. I bought a [property] for $55k – it is beautiful, great property – it is in the books for $167k! o
The landlord tenant laws are so skewed to the tenants, the judge will do anything to keep tenants in their apartments. There are professional tenants who know exactly what to do to stay in an apartment from 4 minimum months to 12-­‐16 months, and a legal system that will keep them in place. I know attorneys who charge $1200-­‐1500 for an eviction and it still takes them months to get anyone out. The current system favors the tenants and they know it. o
For small mom and pop landlords, the eviction process takes too long for them. If the tenant doesn’t pay they don’t have a lot of resources. Capital is very difficult to access for private-­‐sector stakeholders o
Right now there is no financing [for purchase of multifamily rental properties]. The only buyers are cash buyers at auctions. Realtors call me if they have a deal because there are only a handful of folks who can buy them. There is zero bank financing. There is no way to finance the purchase of multifamily. o
For repairs, you can finance if you have a lot of equity and a track record in town – Heritage Credit Union, Lake Sunapee and Berkshire Bank will do some financing for that. [However], for an existing owner with good credit, they would maybe go to 50 or 60% LTV maximum. o
Bank financing is almost impossible. [Landlords] can’t get loans because of the declines in property values – there is no equity there. And the Dodd-­‐Frank bill has made it more difficult to borrow money on real estate. And there are no local banks with local 33 underwriting – that is why Heritage Family Credit Union is booming, they are the one place you can get money. •
o
Funding sources for purchase and renovation are critical. You just can’t get capital now. The banking industry is restricted locally based on national banking problems. Regulations have tied bankers’ hands. o
It is rare to get a banker to finance you. Before 2008 you could finance a place – give the bank the cash flow statement and they’d say okay. Now it’s “where is your 20 percent cash” and “we won’t finance the rehab, you have to do that with cash.” Certain neighborhoods are seen as particularly risky places for investment, although even within these neighborhoods landlords report being able to attract some good tenants if they have a good property o
The strongest locations are in the north section of town or the east section. The weakest are in Happy Valley and in the Baxter Street area. My apartment on the East side I don’t even have to advertise – my tenant who was leaving found a new tenant for me. So there is a real neighborhood effect. o
The boundaries are Grove and State from Stewart’s Shops; go north on Grove until Crescent Street; go west on Crescent to about Baxter or Water and then South on Baxter or Water back to State – that is the section that is going to die in this town. I could invest in that area but it is risky because the tenants who can afford to rent will not go there. If I had to buy on Baxter, Maple – I could not get the tenants to go there. Baxter and Cleveland is where the drugs are being sold. o
At the corner of Park Ave and Grove – going north one block on Grove, going West one block on Park – there are 3 or 4 boarding houses and that is your problem. Most of them are filled with parolees. The main thoroughfare to get from there to Walmart is Grove St, so you have a lot of walking traffic that is not desirable. o
I’ve got [some properties] on Pine Street with no problems at all. I find I can attract good tenants. o
The NW neighborhood was an upscale neighborhood when I was a kid. But there are good people in those neighborhoods. You get 3 or 4 bad houses and that drags down the whole neighborhood. The city has to clean up these … bad buildings. Some of it is drug related too. 34 Homeownership & For-­‐Sale Housing Market Key themes: •
At 52 percent, the homeownership rate in the City of Rutland is well below county, state, and national levels. Census Tract 9631, northwest of downtown, has a particularly low rate of 29 percent that is influenced by the multifamily stock in that area. •
Home prices have seen a dramatic downwards correction, dropping by 28 percent from the 2006 market peak through 2011 in Rutland. This decline is more than twice the drop experienced in Rutland County, underscoring the issues of neighborhood competitiveness that are impacting the health of the city. More recent data from the Realtors® association show continued, moderate price declines, although the Realtors® interviewed for the study uniformly expressed optimism about the direction the market is taking. Sales activity also declined dramatically from the market peak, and continues to be much slower than pre-­‐crash levels although it has recovered slightly. •
As a result of both the steep declines in prices and record-­‐low interest rates now available, Rutland has become an exceptionally affordable place in which to buy a home. At $112,000, the 2011 median house price for Rutland City should be affordable to a household earning approximately $34,250 annually, or 56 percent of the HUD-­‐Adjusted Median Family Income. •
A significant pool of renters exists in Rutland County – we estimate over 1,400 households – that has the savings, debt and income characteristics to qualify for a mortgage and afford a home. Helping these households to navigate the route to homeownership and convincing as many of them as possible to invest in the City of Rutland should form a key component of the City’s revitalization strategy. •
Despite the current affordability of homes, 38 percent of Rutland homeowners are paying over 30 percent of their incomes on housing, and 12 percent are paying over half their incomes – likely reflecting both higher prices paid at the market peak and subsequent shocks to household income during the recession. Mortgage delinquencies have also increased significantly since the onset of the recession – the percentage of 90+ day delinquent loans in Rutland County has gone from 0.8 percent in 2006 to 5.7 percent in 2010. •
Denial rates on mortgages have actually declined slightly from 2006 to 2010, despite the well known tightening of the credit markets. However, lending rates have plummeted, especially for home improvement loans. •
Lis Penden filings spiked in 2008 and 2010, with 70 and 78 filings, respectively. If the second two quarters of 2012 are similar to the first two quarters, Lis Penden filings may reach between 50 and 60 filings, which is high compared to filings in 2006, 2007, and 2011. There is also a geographic concentration of filings west of Route 7. 35 •
Interviewees knowledgeable about the for sale market generally feel that the market has improved considerably, but that lending constraints (such as requirements for high credit scores and savings levels) are impacting the market. Neighborhood effects were also observed in which certain parts of Rutland have less ability to attract strong homebuyers. Nevertheless, interviewees felt that the City of Rutland has marketing strengths (such as convenience and schools with a strong reputation) that are helping to drive interest among homebuyers. Homeownership Rate The Homeownership rate in the City of Rutland is substantially lower than that of Rutland County and Vermont. Within the City, the homeownership rates vary greatly by census tracts with the neighborhood just north of the city center having a rate of only 29%. While the housing stock in that census tract is comprised mainly of multi-­‐family units, which are less conducive to homeownership, the homeownership rate in this area still has room to increase. Other census tracts within the City appear to have a healthy homeownership rate. (See Appendix I for “Tenure by Parcel” map). Geography Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont Tenure % Owner Occupied 72% 29% 57% 49% 52% 70% 71% % Renter Occupied 28% 71% 43% 51% 48% 30% 29% Source: 2010 Census Homeownership vacancy rate Overall, the City of Rutland has a 2 percent vacancy level for for-­‐sale housing. This level is also considered the benchmark for a healthy homeownership market. The rate has increased from a tight market in 2000, with a 1 percent vacancy rate. Tract 9631 is of some concern, given its 4 percent for-­‐
sale vacancy rate. "For Sale" Vacancy Rate Census Tract 9630 Census Tract 9631 Total Owner Occupied Units (Owner Occupied and For Sale Vacant) 1436 499 Vacant Structure For Sale 18 19 For Sale Vacancy Rate 1% 4% 36 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont 789 1217 3941 18563 185005 11 34 82 416 3598 1% 3% 2% 2% 2% Source: 2010 Census Home price trends City prices have seen a much stronger price correction than County prices since the market peak in 2006, according to state property transfer tax data. Rutland County saw median home prices fall from $157,000 in 2006 to $138,500 in 2011, a substantial decline of 12 percent. Median prices in Rutland City, however, dropped 28 percent over the same time period – more than double the County-­‐level decline -­‐ from $155,000 to $112,000. This stark difference in home price trends underscores the competitive disadvantage that Rutland City appears to have in the market place. In short, the data suggest that in a buyer’s market, buyers are more interested in investing outside the city. The number of home sales also declined dramatically in Rutland City from the market peak. Only 30 sales occurred in 2009, less than 10 percent of the activity observed in the busiest year of 2004. Since 2009, activity has increased, but remains below peak levels. Realtor® Association Multiple Listing Service (MLS) data suggests that the market continues to be slow. The median home sale price in Rutland City edged downwards from $130,500 in the first quarter of 2011 to $130,000 in the first quarter of 2012 (note that this is the median price as tracked by the MLS, which does not capture all sales and tends to be higher than the global median price). Average days on the market increased considerably, from 89 days in Q1 2011 to 150 in Q1 2012. The differential between list and sales prices also grew, with the median sale prices declining from 97 percent to 87 percent of median list prices. On the other hand, Realtors® interviewed for this study had very optimistic perspectives, with one describing the spring 2012 market as “fabulous.” Another noted that “the marketplace is definitely gaining strength and has been much busier than we have seen the past few years. People finally realize that [interest] rates are low, there’s a lot [of homes] to choose from, and the market isn’t going to get any better [in terms of an opportunity to buy].” The same Realtor® also reported that they are seeing activity in all price ranges, not just starter homes or foreclosures. Potentially, future market statistics will reflect the uptick that Realtors® believe they are seeing. Residential Sales Under 6 acres Rutland City Rutland County Average Median Number Average Median Number Selling Sales of Valid Selling Sales of Valid Price Price Sales Price Price Sales 2000 $96,009 $84,950 242 $108,224 $90,000 752 2001 $100,747 $92,000 225 $110,518 $96,500 712 37 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 (through 4/30/2012) $106,964 $126,691 $131,563 $141,975 $165,259 $163,249 $154,223 $148,717 $138,472 $116,182 $95,000 $110,000 $123,600 $136,000 $155,000 $155,000 $148,250 $144,000 $125,000 $112,000 $99,354 $93,000 266 308 309 299 254 198 144 30 109 123 $117,483 $133,847 $139,200 $155,146 $179,737 $189,159 $180,300 $160,835 $161,471 $150,785 $100,000 $118,000 $126,000 $140,000 $157,000 $159,500 $159,000 $148,000 $146,955 $138,500 769 816 893 691 717 612 434 317 409 401 42 $131,998 $120,000 143 Source: Vermont Property Transfer Tax Data (www.state.vt.us/tax/statisticsproptrans.shtml) Median Sales Price Residential Properties 6 acres or less
$180,000
$160,000
$140,000
$120,000
$100,000
Rutland City
Rutland County
$80,000
$60,000
$40,000
$20,000
$-­‐
2000
2002
2004
2006
2008
2010
2012
(through
4/30/2012)
38 Number of Valid Sale Transfers -­‐ Residential Properties less than 6 Acres
Rutland City
350
308
300
250
309
299
266
242
254
225
198
200
144
150
123
109
100
42
30
50
2)
20
1
20
11
20
12
(t
hr
o
ug
h 4/
30
/
20
10
20
09
20
08
20
07
20
06
20
05
20
04
20
03
20
02
20
01
20
00
0
Year
An appraiser present at the first public meeting, who has access to very detailed sales transaction data, informed the consultants that his firm notes a bi-­‐modal distribution of home sale prices (basically a higher-­‐priced and a lower-­‐priced tier of homes). The firm has further seen that homes in the upper price tier have held their value while declines have been marked in the lower tier. Some of the observed decline in median prices may be explained by a greater number of lower-­‐tier homes transacting (as a proportion of total sales activity). Homeownership affordability As a result of both the steep declines in prices and record-­‐low interest rates now available on the market, Rutland has become an exceptionally affordable place in which to buy a home. At $112,000 the 2011 median house price for Rutland City should be affordable to a household earning approximately $34,250 annually.2 This income translates to only 56 percent of the HUD-­‐Adjusted Median Family Income for Rutland County. A household at this income level might have difficulties coming up with the cash for downpayment or closing costs, or might have other debts or credit issues that make it difficult to qualify for a mortgage, but making the mortgage payment per se would not be the barrier. 2
This estimate uses a house-­‐price-­‐to-­‐income multiplier of 3.27, which in turn assumes that the homebuyer obtains a 30-­‐year, fixed-­‐rate mortgage with interest rate plus mortgage insurance costs of 4.5%, makes a 3.5% downpayment, has property tax and insurance costs of 3% of property value per year, and is underwritten to a 0.29 front-­‐end ratio. 39 Median House Price: 2011 Estimated Income needed to afford the median home 2009 ACS Household Median Income 2011 HUD Adjusted Median Family Income (HAMFI) % of HH median income needed to afford % of HAMFI needed to afford Rutland City $112,000 $34,251 $39,892 $60,800 86% 56% Rutland County $138,500 $42,355 $46,153 $60,800 92% 70% Potential first-­‐time homebuyer market We conducted an analysis of current renters by income level and used Survey of Consumer Finance data to estimate the number of renter households with at least $1,000 cash savings and consumer debt levels of less than 9 percent.3 The analysis indicates that there is a substantial pool of renter households in moderate-­‐income tiers who could potentially become first-­‐time homebuyers. In the $22,000 to $55,000 income tier – all of which lies below the HUD-­‐Adjusted Median Family Income -­‐ there are an estimated 829 such households in Rutland County. Another 603 potential first-­‐time homebuyers are in higher income tiers. Estimated first-­‐time homeownership potential, Rutland County Income Range < $11,047 $11,047 to $22,093 $22,093 to $38,663 $38,663 to $55,233 $55,233 to $82,851 $82,851 to $110,468 $110,468 and above Total renter households 971 1,771 1,927 1,561 853 349 166 Potential first-­‐time homebuyers 65 207 411 418 349 130 124 As a % of all renter households in income range 6.7% 11.7% 21.3% 26.8% 41.0% 37.3% 74.6% 3
Analysis of data from the 2007-­‐2009 American Community Survey and PUMS data, and the 2007 Survey of Consumer Finance. Regarding affordability, this estimate uses a house-­‐price-­‐to-­‐
income multiplier of 3.27, which in turn assumes that the homebuyer obtains a 30-­‐year, fixed-­‐
rate mortgage with interest rate plus mortgage insurance costs of 4.5%, makes a 3.5% downpayment, has property tax and insurance costs of 3% of property value per year, and is underwritten to a 0.29 front-­‐end ratio. 40 All incomes 7,598 1,705 22.4% Affordability of homes for potential first-­‐time homebuyers, Rutland County Income Range < $11,047 $11,047 to $22,093 $22,093 to $38,663 $38,663 to $55,233 $55,233 to $82,851 $82,851 to $110,468 $110,468 and above Potential first-­‐
time homebuyers 65 207 411 418 349 130 124 Potential Existing Number of Owner-­‐
Homes Occupied Units Available on the in Price Range Market 709 71 869 87 3,030 303 5,282 528 4,857 486 1,636 164 1,944 194 Target Home Price Range $0 to $36,100 $36,100 to $72,300 $72,300 to $126,400 $126,400 to $180,600 $180,600 to $271,000 $271,000 to $361,300 $361,300 and above Homeownership cost burdens As of 2010, there were 478 homeowners in the City of Rutland – 12 percent of all homeowners – who were paying over half of their incomes on housing costs. Of these severely cost-­‐burdened homeowners, 393 had a mortgage on their property and are at risk of falling behind on their payments. The remainder are likely struggling to stay current on property tax payments and other basic housing costs. Selected Monthly Owner Costs as a Percentage of Household Income Total Homeowners Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont 1526 557 737 1126 3946 18495 183162 Cost Burdened Homeowners (30%-­‐49%) Number of Homeowners 373 144 199 297 1013 3748 38336 % of Homeowners 24% 26% 27% 26% 26% 20% 21% Severely Cost Burdened Homeowners (50%+) Number of Homeowners 246 52 75 105 478 2354 21936 % of Homeowners 16% 9% 10% 9% 12% 13% 12% Source: ACS 2006-­‐2010 5 year estimates As with renters, cost-­‐burdened homeowners are likely to have low incomes under $35,000 a year. However, cost burdens are now much more commonplace among higher-­‐income homeowners earning over $35,000 a year, compared to a decade ago. The fact that there are so many cost-­‐burdened 41 homeowners despite the affordability of homes on the market is likely a reflection of high prices relative to incomes that many owners paid at the peak of the market. In some cases, the “stretch” to buy a home may have become exacerbated by onerous mortgage terms (such as upwards adjustment of the interest rate) or shocks to household incomes (such as job loss or loss of hours). Household Income by Selected Monthly Mortgage Costs as a Percentage of Household Income % Cost Burdened (30% or more) Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont 1999 Household Income $35,000 and under 54% 53% 45% 60% 54% 51% 52% 1999 Household Income $35,000 and over 8% 13% 4% 3% 6% 8% 11% 2010 Household Income $35,000 and under 85% 48% 74% 60% 70% 69% 69% 2010 Household Income $35,000 and over 23% 29% 24% 22% 24% 20% 22% Source: 2000 Census; 2006-­‐2010 ACS 5 year estimates Homeowners with a Mortgage by Monthly Owner Costs as a Percentage of Household Income Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont Total Homeowners with a Mortgage 1038 329 467 639 2473 11,889 123,005 Cost Burdened Homeowners (30%-­‐49%) Number of Homeowners 284 134 148 155 721 2787 30239 % of Homeowners 27% 41% 32% 24% 29% 23% 25% Severely Cost Burdened Homeowners (50%+) Number of Homeowners 227 23 64 79 393 1759 16341 % of Homeowners 22% 7% 14% 12% 16% 15% 13% Source: ACS 2006-­‐2010 5 year estimates Homeowners without a Mortgage by Monthly Owner Costs as a Percentage of Household Income Census Tract 9630 Total Homeowners without a Mortgage 488 Cost Burdened Homeowners (30%-­‐49%) Number of Homeowners 89 % of Homeowners 18% Severely Cost Burdened Homeowners (50%+) Number of Homeowners 19 % of Homeowners 4% 42 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont 228 270 487 1,473 6,606 60,157 10 51 142 292 961 8,097 4% 19% 29% 20% 15% 13% 29 11 26 85 595 5,595 13% 4% 5% 6% 9% 9% Source: ACS 2006-­‐2010 5 year estimates The home mortgage market 2010 HMDA data for Rutland County show that loan denial rates have actually dropped somewhat for purchase, home improvement, and refinance mortgages since the market peak in 2006. On the other hand, the number of loan originations has plummeted. Part of the reason for lower denial rates may simply be that only qualified borrowers are even trying to apply. The steep drop on home improvement lending activity may be in part the reflection of declining equity in people’s homes and therefore difficulties in meeting the loan-­‐to-­‐value requirements of the lender. Rutland County Home Purchase Home Improvement Refinance Originated Origination Frustrated Frustration Denied Rate Rate 246 66.5% 61 16.5% 63 101 61.2% 17 10.3% 47 690 56.2% 257 20.9% 280 Denial Rate 17.0% 28.5% 22.8% 2006 HMDA data comparison, for Rutland County: Home Purchase Home Improvement Refinance Originated 844 286 1011 Origination Rate 65.9% 55.5% 42.9% Frustrated 193 73 672 Frustration Rate 15.1% 14.2% 28.5% Denied 244 156 675 Denial Rate 19.0% 30.3% 28.6% Local and regional banks appear to enjoy a significant share of the loans originated. Large national lenders such as Bank of America, Chase, Citigroup and Wells Fargo are notably absent from the market. PEOPLE'S UNITED BANK VT STATE EMPLOYEES CREDIT UNION RBS CITIZENS, N.A. Number of Originations 137 76 72 Market Share 13.2% 7.3% 6.9% 43 LAKE SUNAPEE BANK QUICKEN LOANS METLIFE BANK, N.A. PHH MORTGAGE CORPORATION TD BANK N.A. MERCHANTS BANK BERKSHIRE BANK 67 54 52 48 44 42 42 6.5% 5.2% 5.0% 4.6% 4.2% 4.1% 4.1% Mortgage delinquencies and foreclosures Mortgage loan performance has been much better in Vermont and Rutland County than the nation as a whole. However, serious mortgage delinquencies have still increased significantly from the housing market peak in 2006. Credit card and car loan delinquencies have also increased since the recession. Debt balances, however, have moderated, which could help the market to recover over the long term. Auto Debt per Capita % of Auto Debt Delinquent 90+ Days Credit Card Debt per Capita % of Credit Card Debt Delinquent 90+ Days Mortgage Debt per Capita % of Mortgage Debt Delinquent 90+ Days 2000 2005 2006 2007 2008 2009 2010 2011 $2080 $3000 $3030 $3040 $2960 $2760 $2600 $2591 1.29% 0.72% 0.94% 1.24% 0.76% 2.85% 1.61% 2.02% $2250 $2750 $2750 $2750 $3100 $2870 $2530 $2477 9.30% 6.53% 9.22% 9.39% 12.31% 17.67% 16.31% 13.98% $13590 $19310 $21270 $23380 $24460 $23930 $22970 $21897 0.27% 1.19% 0.82% 0.88% 2.98% 5.53% 6.69% 5.72% Source: Federal Reserve Bank of New York A detailed analysis of the performance of prime mortgages indicates that Rutland County is faring relatively well compared to the United States overall, with lower delinquency and foreclosure rates. Clearly, however, enough foreclosures and delinquencies are occurring that the market is still being impacted. 44 Prime Mortgages -­‐ Credit Conditions, as of November 2010 active % % % loans 30-­‐
60-­‐
# % in 90+ % per # active 59 89 foreclosures fore-­‐
days ARM 1000 loans days days per 1000 closure past loans hsg past past hsg units due units due due Rutland County 158.8 5,230 2.9% 2.8% 0.8% 1.4% 4.7 6.3% Vermont 149.6 46,776 2.2% 2.4% 0.7% 1.2% 3.3 6.0% United States 204.6 26,415,321 3.1% 3.0% 1.2% 3.0% 6.3 11.1% % ARM loans resetting in next 12 mos. 7.6% 8.8% 10.7% Source: Lender Processing Services; Federal Reserve Bank of New York According to data from the City of Rutland, Lis Penden filings spiked in 2008 and 2010, with 70 and 78 filings, respectively. If the second two quarters of 2012 are similar to the first two quarters, Lis Penden filings may reach between 50 and 60 filings, which is high compared to filings in 2006, 2007, and 2011. The “Lis Pendens Filed Map” in Appendix I, shows a concentration of filings west of Route 7 from 2006 – Q2 2012. Lis Pendens Filed
Rutland City
90
78
80
70
Number of Filings
70
60
46
50
40
30
43
38
28
21
20
10
0
2006
2007
2008
2009
2010
2011
Through Q2
2012
Stakeholder perspectives on the for-­‐sale market Additional perspectives shared stakeholders we interviewed for this project on the for-­‐sale housing market included the following: o
Neighborhood effects are observed including a strengthening market in the southwest and challenges in the Baxter Street area. 45 o
o
o
An interviewee reported that the southwest quadrant (“the Gut”) has been strengthening – “a lot of properties have been fixed up; there are not as many run-­‐down properties. Then you add in Stonegate [a recent for-­‐sale development] – there are nice little homes in there, and with the Forest Park development [the Hickory Street apartments project being developed by the Rutland Housing Authority] what’s around them is a little nicer. The values are holding.” Another interviewee noted a strong tradition of homeownership in this area, and a third noted resident-­‐led initiatives such as RUN that have helped to stabilize and improve the neighborhood. o
On the other hand, an interviewee reported that “the northwest section – around Baxter and State – has been a little more difficult. There is some crime in those areas that has gotten headlines, and even a few neglected properties affect the neighboring homes. For homebuyers there is a tendency to cut off west of Grove Street.” Even this neighborhood has positive aspects, such as Georgetti Park and schools that are considered strong. A different interviewee expressed concern about this neighborhood, including very negative perceptions of safety and a high degree of absentee ownership. Lending constraints are impacting the for-­‐sale market. o
“The credit piece is huge right now. You have to have decent credit – if you are below 680 [FICO score] it is much, much more difficult. You really need over 680, and over 720 in a lot of cases. And the savings – having a little money to put down. Four or five years ago people were getting 100% financing; not anymore.” o
One interviewee noted that “For home rehabilitation, there has been more creativity here. [FHA] 203(k) loans are rearing their heads again, but there’s only a few places doing those [loans] and there is not a good explanation of the program. Also, there is more negotiation after the building inspection.” Several Rutland-­‐area lenders interviewed for a separate project also noted that purchase-­‐rehab financing was an area where would-­‐be borrowers were facing challenges obtaining financing. The City of Rutland has marketing strengths that are helping to drive interest among homebuyers. o
Interviewees noted that they are seeing interest among seniors in living in the city -­‐ “it is easier for them to maneuver, often walking distance.” o
Realtors® see a mix of families wanting to be in the city or the outskirts, with one noting that “folks don’t avoid living in the City.” Rutland City schools have a strong reputation according to these interviewees, including Rutland High School, which as a broad set of academic and extracurricular offerings. o
At the same time, an interviewee noted that “you don’t see so many really young buyers. It is harder for younger folks to have the kind of jobs that are going to help them afford a home. You see folks coming back to this area when it is time to raise their kids.” 46 Housing for the Elderly Key themes: •
Senior populations are expected to increase, and with it demand, particularly for younger senior housing. •
Housing cost burdens and disabilities are both important issues affecting senior households (age 65 and over). Forty-­‐five percent of senior renters are housing cost burdened. Forty percent of seniors in Rutland have a disability. Age Distribution of Seniors From 2000 to 2010 the 85+ year old seniors grew by over 23%. As those seniors age out, it is expected that over the next five years, the largest increase in the senior population will be among 65-­‐69 year olds and 70-­‐74 year olds. According to the Hickory Street Market Study, it is anticipated that in the decade ahead the demand for younger senior housing will increase and that the single household senior housing may decrease.4 65-­‐69 Years Old 70-­‐74 Years Old 75-­‐79 Years Old 80-­‐84 Years Old 85+ Years Old Total 65 and Over Senior Age Distribution Rutland, VT 2000-­‐2015 Estimate 2015 % Change % Change 2000 2010 Estimates 2000-­‐2010 2010-­‐2015 889 987 1220 11 23.6 859 695 910 -­‐19.10% 30.90% 816 706 770 -­‐13.5 9.1 682 633 614 -­‐7.2 -­‐3 656 811 662 23.6 -­‐18.4 3902 3833 4176 -­‐1.8 9 Source: U.S. Census 1990, 2000, 2010 STF-­‐1 DP-­‐1; Project Development Cycles based on VT DAIL estimate; Hickory Street Market Study Housing Cost Burden of Seniors When calculating gross rent as a percentage of household income, 45% of Rutland renters ages 65 and up are cost burdened. This is comparable to Rutland County and Vermont at 44% and 47%. Within the City of Rutland a disproportionate number of cost burdened seniors reside in census tract 9632, in the northwest section of the city. 4
. Ryan, John J. “Rutland Vermont, Housing Feasibility Assessment for the Hickory Street Apartments”, March 2012. 47 Householder 65+ by Gross Rent as a Percentage of Household Income Total # of % of Rental households households Households 30% or 30% or more Age 65+ more Census Tract 9630 103 26 25% Census Tract 9631 44% 201 88 Census Tract 9632 68% 77 52 Census Tract 9633 48% 178 85 Rutland City 45% 559 251 Rutland County 44% 1290 562 Vermont 47% 11,608 5487 Source: ACS 2006-­‐2010 5 year estimates Disability Status of Seniors In Rutland City, 40% of seniors age 65 and over have a disability. This is slightly higher compared to the percentage of seniors with disabilities in Rutland County and Vermont. There is a higher concentration of seniors with disabilities in census tracts 9630 and 9631, at 43% and 47%. Seniors with Disabilities Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont Number of Seniors Age 65+ with a Disability % of Seniors Age 65+ 363 260 139 334 1,096 3,402 28,293 43% 47% 28% 39% 40% 38% 39% Source: 2000 Census Available Subsidized Senior Rental Housing According to the Directory of Affordable Rental Housing through the Vermont Housing Data website, there are 195 subsidized housing units exclusively for elderly housing and an additional 259 subsidized housing units reserved for elderly households with disabilities. Combined, this represents 57% of total subsidized rental units available in Rutland City. 48 Total Senior Rental Households and Subsidized Senior Rental Units Rutland City Total Rental Households Age 65+ 559 Total Rental Households Cost Burdened 251 Total Subsidized Rental Units for Elderly and Elderly Disabled 454 Source: DoARH, Vermont Housing Data (www.housingdata.org); ACS 2006-­‐
2010 5 year estimates Owner occupied age distribution Of the total number of owner occupants, 27% are age 65 years and older in the City of Rutland, a larger percentage than is found in both Rutland County and Vermont. Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont Owner Occupied Age Distribution % of 15-­‐34 35-­‐64 65+ 15-­‐34 195 972 58 344 63 502 64 693 380 2511 1610 12,000 17,054 122,715 359 155 172 369 1055 4,885 43,393 13% 10% 9% 6% 10% 9% 9% % of 35-­‐64 64% 62% 68% 62% 64% 65% 67% % of 65+ 24% 28% 23% 33% 27% 26% 24% Source: ACS 2006-­‐2010 5 year estimates Special Needs Housing Key themes: •
The City of Rutland has a high concentration of non-­‐institutionalized people with disabilities, a concentration which is even more elevated in its poorest census tract. People with Disabilities Rutland City has a higher percentage of the non-­‐institutionalized population with a disability at 22% compared to that of Rutland County at 19%, and Vermont at 17%. Within Rutland City, the highest concentration of people with disabilities falls within census tract 9631, at 26%, located near the center of the city. This is the same location where there are a disproportionately high percentage of people living in poverty, as well. 49 Disability Status Census Tract 9630 Census Tract 9631 Census Tract 9632 Census Tract 9633 Rutland City Rutland County Vermont Population Age 5+ with a Disability 803 837 629 1165 3434 11329 97167 % of Population 5+ with a Disability 19% 26% 20% 23% 22% 19% 17% Source: 2000 Census Housing for People with Disabilities Rutland currently has three subsidized housing developments each with 6 units that accommodate people with disabilities. These include the Royce Street Group Home, the Westview Court Intermediate Care Facility, and the Royce Street Congregate Living. There are several housing developments that target both elderly and people with disabilities, totally 259 subsidized rental units. Of all the units available for people with disabilities, 28 are handicap accessible. Available Subsidized Rental Units for People with Disabilities Number of Number of Units for Development Name Units for Elderly & Disabled Disabled Maple Village 4 Parker House 46 Templewood Court 60 Sheldon Towers 74 Bardwell House 75 Royce Street Group Home 6 Westview Court Intermediate Care Facility 6 Royce Street Congregate Living 6 Total: 259 18 Number of Units Accessible 4 7 4 3 4 6 28 Source: DoARH Vermont Housing Data (www.housingdata.org) 50 Recommendations Implement focused revitalization initiatives in the neighborhoods surrounding downtown The neighborhoods west of Route 7 and surrounding the downtown are undervalued relative to the many assets they offer, including historic (and in some cases architecturally significant) building stock; proximity to downtown conveniences, arts and culture; a walkable, traditional neighborhood fabric; and even notable outdoor recreation amenities (such as the 300 acre Pine Hill Park and East Creek for the neighborhood just northwest of downtown). Now is the time for the City of Rutland and its partners to lead the way to spur private market investment in this area. Moreover, as noted by several participants in the first public meeting, revitalizing these neighborhoods could form an important part of a larger economic development strategy for the region, by providing a unique living experience -­‐ high-­‐quality urban neighborhoods set amidst a spectacular, almost pristine rural and natural landscape -­‐ that could help to attract and retain businesses and employees. (One group of participants at the public meeting even came up with a quality-­‐of-­‐life-­‐based marketing slogan for Rutland, “Come Up for AIR.”) See the map in Appendix I, “Recommended revitalization focus area,” for the specific geographies in which we recommend that this work begin. Any of the areas marked as “transitional” or “revitalization” areas are potential candidates for this work, with the “revitalization” area on the map, located northwest of downtown, requiring the most intensive investments to be made if an impact is to be seen. The “Healthy Neighborhoods” approach to revitalization A “Healthy Neighborhood” is a place where it makes economic and emotional sense for people to invest their time, money and energy; and a place where neighbors successfully manage neighborhood-­‐related issues and neighborhood change. 5 A “Healthy Neighborhoods” approach to revitalization means that four outcomes serve to guide every aspect of revitalization work. These outcomes are Image, Market, Physical Conditions, and Neighborhood Self-­‐Management.6 Image: The neighborhood will have a positive image that attracts investment – from homebuyers, homeowners, business, and government. People will be confident in the future of the neighborhood. Market: The residential and commercial real estate market will reflect this confidence. The neighborhood will make economic sense for key investors -­‐ homebuyers, homeowners, landlords, business and government – because property values will be steadily increasing. This will enable homeowners, homebuyers and landlords to carry out improvements and build assets. It will enable businesses to remain or locate in an improving neighborhood, and it will 5
“Strategies and Implementation Techniques for Creating Neighborhoods of Choice Through Revitalization.” NeighborWorks® America Training Institute, 2005. 6
Indented material is excerpted from the training manual, “Strategies and Implementation Techniques for Creating Neighborhoods of Choice Through Revitalization.” NeighborWorks® America Training Institute, 2005. 51 enable government to see the property value base stabilize. At the same time, the neighborhood will offer housing options for, and be attractive to, a variety of income groups. It will help neighbors who want to, stay and benefit from revitalization. Physical Conditions: Physical conditions, whether residential or business, will reflect pride of ownership and a high standard of maintenance. Public infrastructure will be maintained and improved to a standard similar to neighborhoods currently viewed as better. Neighborhood Management: Collective action by residents, institutions, and businesses will ensure the neighborhood will compete well with other neighborhoods for resources. Residents will have the capacity to manage the day-­‐to-­‐day activities on their blocks. Neighbors will feel comfortable being “neighborly” – looking out for each other, getting together to work on problems, taking action to reinforce positive standards and actions, etc. Neighbors will feel safe in the neighborhood. As Alexander Garvin states in his book, The American City: What Works and What Doesn’t, “planning is public action for private market reaction.” This is particularly true of neighborhood revitalization work. The City can fix the sidewalks and a nonprofit could acquire and rehabilitate some buildings, but for a neighborhood to thrive, individual households and property owners have to decide that they want to invest their time, money and energy in the neighborhood. The challenge is that would-­‐be owners in a revitalizing neighborhood face a “prisoner’s dilemma” when deciding whether to invest in a neighborhood. If a homeowner invests and their neighbors invest, everyone wins. But if the homeowner invests and their neighbors do not, the homeowner faces potentially large financial losses, has wasted time and energy, and to make matters worse must also put up with the nuisances generated by their neighbors’ lack of investment. Spurring private investment in revitalizing neighborhoods therefore depends on convincing households and property owners that if they invest their time, money and energy, their neighbors will do the same. The strategies described below are specifically designed to create the confidence that is needed to spur neighborhood investment. Select a geographically focused investment area, building from strength rather than weakness A revitalization initiative should work on a house-­‐by-­‐house, block-­‐by-­‐block scale. We recommend selecting no more than a 10-­‐ to 15-­‐block area for the first revitalization initiative, and working exclusively in that area for at least a year or two before considering establishing additional focus areas. Moreover, even within that 10-­‐ to 15-­‐block area, individual streets and properties will need to be strategically and carefully selected for special attention to maximize revitalization impacts. For example, it makes sense to focus efforts on a highly visible street that sets the tone for the neighborhood, and on key corner properties on that street. In selecting an area to work, it is vitally important NOT to select an area because it has the most vacant buildings, the most crime, or is “the worst” part of the city in some other way. Target areas can have some of these weaknesses, but if a revitalization initiative is to succeed, they need to be selected 52 instead for their unique strengths. For example, a good candidate for a revitalization initiative might have one or more (and ideally all) of the following: •
An existing core of resident leaders who are creative, energetic, optimistic, and collaboratively-­‐
minded in pursuing the improvement of their neighborhood •
A park, school, or other public asset that is a uniquely high-­‐quality amenity compared to what other neighborhoods can offer, or can practicably be developed into such an amenity •
Locational assets (for example, the neighborhood is not only a short distance from downtown, but the walking route to get there is particularly easy and pleasant) •
Housing stock that could have uniquely marketable qualities if it is properly repaired and maintained (for example, stock of real historic architectural significance, even if it is currently not well cared for, might indicate a neighborhood with greater revitalization upside than an area of better-­‐cared-­‐for but less historically significant housing) •
An emerging market segment of homebuyers or renters who are becoming interested in the neighborhood and whose decisions to live there creates a positive image for the neighborhood. (For example, a neighborhood might be starting to attract, or at least potentially able to attract, professionals working at a nearby employer, or young artists, or some other group that has choices about where to live). Employ a neighborhood marketing approach A concerted effort must be made to promote a positive “story” about the target neighborhood and how it is changing. Examples of neighborhood marketing activities that other communities have undertaken include: Naming the neighborhood. Rutland is somewhat unique in having only one neighborhood (“the Gut,” also sometimes called “Happy Valley”) with a clearly named identity. Other neighborhoods to the north of downtown could have a name established for them (“Pine Hill Park,” perhaps, or “East Creek,” for example) that communicates the image of a desirable place to live. Neighborhood ambassadors. Neighborhood ambassadors are resident volunteers that help to welcome new households to the neighborhood and to market the neighborhood to prospective homebuyers – providing real-­‐life testimonials about neighborhood amenities and quality of life. Ideally, Realtors® would be connected to the neighborhood ambassadors program so that they can introduce prospective homebuyers to them. Realtors® on retainer. Neighborhoods with lower property values are difficult for Realtors® to invest a lot of time in, since a 5 or 6 percent commission on a $50,000 property is not a lot of money. A Realtor on Retainer program offers some compensation to a professional Realtor® to work with a neighborhood revitalization program to help market the neighborhood, identify ways to position properties on the market to attract desirable buyers, and inform program staff about the market trends and opportunities they are observing. 53 Realtor continuing education neighborhood tours. In several communities, neighborhood revitalization programs have offered workshops – for which Realtors® can earn continuing education credit – about the history, amenities, and homeownership opportunities in their neighborhoods. The classes are intended to help give Realtors® the information they need to identify customers who might be interested in the neighborhood and present the target neighborhood in a positive light to them. Employer-­‐based marketing. A revitalization program could work with a major area employer to offer special incentives for their employees to live nearby in the target neighborhood. The employer benefits from its employees sending roots into the neighborhood and cutting down their commute time. The employee may benefit from special employer incentives that could include downpayment assistance or even special mortgages. Large institutional employers such as colleges and hospitals may be good candidates to consider for such an approach. Historic building tours and education. Workshops, tours and educational series can help to highlight a unique historic building stock, both promoting greater interest by Realtors® and prospective buyers, and helping existing owners to better maintain and improve their buildings. The City of Boston launched an education effort with Realtors several decades ago to talk to them about the historical and architectural significance of the “triple decker” three-­‐unit multifamily buildings that are so common throughout the area. The Chicago Greystone Initiative, led by Neighborhood Housing Services of Chicago, offers workshops, special financing, and outreach to encourage the purchase and maintenance of this unique building stock. Other revitalization projects have held historic home tour evenings where people can see how their neighbors have restored their homes. Hawley-­‐Green Neighborhood in Syracuse, NY puts on an annual Historic Homes and Gardens Tour that brings people in from all over the region as a way to promote the neighborhood and encourage investment. Neighborhood media. Newsletters, websites, social media, and placement of articles in the local media can all work to support a positive “buzz” about what is happening in the neighborhood. Stories would emphasize topics such as a new homebuyer purchasing in the neighborhood, positive aspects of the neighborhood’s history or amenities within it, upcoming events, stories about neighborhood improvements or homeowners making improvements recently, etc. City-­‐wide marketing initiatives that showcase individual neighborhoods can also be conducted through media channels. Some cities have website devoted exclusively to encouraging homebuyers to consider purchasing in their neighborhoods – see, for example, www.livebaltimore.com, which even has a “neighborhood match” feature meant to help prospective buyers find the neighborhood that is just what they are looking for, and www.rochestercityliving.com for good examples. “Block purchasing” compacts. In a few instances, groups of people have organized themselves to purchase homes in revitalizing neighborhoods – knowing that the commitment of everyone in their group to purchase and fix up their home made the investment of each individual in the group that much 54 safer.7 While difficult to implement, it may be worth considering how a neighborhood revitalization initiative could help to form groups of like-­‐minded homebuyers and facilitate their purchase and rehab activity. “City living” component to homebuyer education. Existing homebuyer education providers, such as NeighborWorks® of Western Vermont, could be asked to distribute marketing materials about living in Rutland to participants or to invite class participants to attend a special tour or educational event. An example of this approach from another community is the City of Rochester (NY) “City Living Sundays” program, which holds educational seminars about the benefits and perks of living in Rochester for prospective buyers, and even bus tours led by experts who talk about neighborhood history and amenities as well as special incentive programs the City offers. “Pick Your Neighbor” parties. Belair-­‐Edison Neighborhoods, Inc. in Baltimore worked with Realtors® to hold open houses for homes that were on the market. It used its neighborhood connections to encourage neighbors on the block to invite their friends, family and co-­‐workers to the open house and attend it themselves. Sometimes the organization also prepared a scope of work showing how improvements could be made in the property and financed with special loan products. Connect neighbors to one another to drive revitalization work A common mistake that local planners and revitalization initiative staff members make is to try to “organize” residents into formal structures and formal roles, hold regular meetings, and then assume that the community is being engaged if the meetings go well (or complain that “no one cares” if the meetings are not well attended). The pitfall of this approach is that the public meeting becomes the all-­‐
consuming focus of the work, when the reality is that 1) public meetings in and of themselves do not get actual work done to improve the neighborhood and are usually regarded as either boring, stressful, or both by attendees; 2) residents and other neighborhood stakeholders do not typically strengthen their neighborhood social ties significantly over the course of the meeting itself, although they may socialize beforehand and afterwards; and 3) typically only a very small subset of residents has the time or inclination to sit through meetings. If formal neighborhood governance structures exist, by all means they should be partners in the revitalization initiative. Existing groups and associations should be carefully inventoried in the target neighborhood and their leaders and members approached for their ideas about how to improve the neighborhood. However, promoting informal connections between neighbors and engagement in hands-­‐on, fun, and relatively low-­‐commitment neighborhood improvement activity is by far the most effective way to achieve neighborhood self-­‐management outcomes. 7
Baltimore has seen some of this activity, thanks to the efforts of a group called TechBalt.com. See, for example, “Take That Hill: A Group of Would-­‐Be Homeowners Challenge Developers for the Right to Buy and Rehab Homes in Reservoir Hill.” Ana Ditkoff, City Paper, April 2004. On the internet at: http://www2.citypaper.com/news/story.asp?id=8188 55 A good way to start the process of building informal connections is for resident volunteers to meet one-­‐
on-­‐one with other residents and neighborhood stakeholders, and ask them three simple questions: •
What good things are already going on in this neighborhood that you would like to see more of? •
What new ideas do you have for things that neighbors could do to make this neighborhood a nicer place to live? •
Who do you consider to be a leader in this neighborhood and what are they doing that makes you say that? (Can you connect us to them?) These conversations will usually yield a set of actionable, fun, and constructive ideas for neighborhood improvement. Better still, they can yield a map of neighbors who are interested in similar topics and activities. An effective follow-­‐up strategy can be to ask one of these neighbors to host a potluck dinner of like-­‐minded neighbors interested in the same topic, and facilitate conversation about things the group can do together. The following are examples (from real communities) of relatively informal, small-­‐scale activities that help to strengthen connections among neighbors, make visible (albeit small) impacts in the neighborhood, and build confidence in the future of the neighborhood. These types of activities should take priority over organizing “planning meetings” or creating quasi-­‐formal governance structures in the neighborhood – in most cases, the information sharing that happens in a meeting can be shared in a less formal and more fun way during the course of these activities, anyway. •
Ice cream socials, potluck dinners, dog walks, street parties, music festivals, movies in the park, and other ways to bring both small and large groups of neighbors together to get to know one another better. Bel-­‐Air Edison Neighborhoods, Inc. in Baltimore uses these events very strategically – for example, assisting neighbors to hold an ice-­‐cream social to find other neighbors who want to do a neighborhood improvement project like a clean-­‐up with them, or holding “rehabber pot lucks” for homeowners who are in the middle of rehabbing their homes to have a meal and share their stories together. •
Beautification projects (flower planting, “Paint Your Heart Out” days, clean-­‐ups). Contests can also be held for the “best house on the block” or the “best block in the neighborhood.” •
Purchasing cooperatives: Neighbors can pool together to get all of their driveways resurfaced, or install similarly-­‐themed exterior lighting, mailboxes or house numbers, or purchase landscaping materials at reduced prices by contracting in bulk. NeighborWorks® Rochester in Rochester, New York, has had particular success with this strategy. •
Tool lending libraries: Places where neighbors can go to rent equipment they’ll only need once or twice to get a home improvement job done. Swap meets could also be organized to help rehabbers find materials they need. The Portland Rebuilding Center in Portland, Oregon has taken this idea to new heights with a 60,000 square-­‐foot warehouse generating approximately 50 local jobs and $3 million in revenues – but even this organization started out as a relatively 56 informal effort among neighbors to salvage and trade used building materials amongst each other. •
Community gardens: New Kensington CDC in Philadelphia even runs a Garden Center in the heart of its neighborhood that sells plants, compost, and other gardening materials to neighbors. Many other cities have nonprofit groups who specialize in providing technical assistance to resident leaders who want to start a garden, such as the Civic Garden Center in Cincinnati, for example. •
“Green Guides” – New Kensington CDC enlists community volunteers to encourage their neighbors to recycle, maintain a street tree, and save energy. •
Block grandmas: “Block grandmas” involve local senior citizens to host a visit from a school child after school. •
Mini-­‐grants for neighborhood leadership. Of all the ideas mentioned above, the best ideas are always the one that a group of neighborhood residents has the passion to take on. Formal organizations involved in a neighborhood revitalization initiative – whether they are government agencies, nonprofit organizations, or community associations – do best when they listen and encourage residents to take the lead with their own ideas, rather than push a preconceived idea for neighborhood improvement and engagement. Minigrant programs are one way to help do this – the sponsoring organization puts out a request for ideas and offers a small amount of funding to help neighbors make their idea a reality. Incentivize and facilitate private market investment Several strategies could help to boost the monetary investment made by both landlords and homeowners in their properties: •
Capitalize a rehabilitation loan fund. The loan fund would offer financing at below-­‐market rates for both landlords and homeowners. Similar loan products in other soft markets will go slightly over 100 percent of after-­‐rehabilitation loan-­‐to-­‐value ratios for homeowners, and as far as 90 percent for investor-­‐owners – thus enabling property improvements to be made even when there is little equity in the property. Loan terms might be for approximately 10 to 12 years. Some programs offer especially attractive rates (even 0%) for the cost of exterior home improvements (such as painting or porch replacement) that make a highly visible impact on the neighborhood. •
Offer property tax stabilization for owner-­‐occupants who purchase vacant homes. At a minimum, such a program might freeze the current tax rate for owner-­‐occupants purchasing a vacant or distressed home for a set period of time (say, 5-­‐10 years). The City of Syracuse offers property tax exemptions for new and renovated properties and has additional benefits for reaching certain green-­‐building standards. The City of Cleveland also offers a tax abatement on improvements costing over $2,500 of one and two-­‐family homes that increase the assessed value of the property. 57 •
Study regulatory reforms to lessen operational burdens on landlords. Landlords universally reported extraordinarily long eviction periods, significant eviction legal costs, and a variety of other regulatory burdens that are causing small landlords to leave the market and thus helping to depress multifamily property values to levels that are unsustainable. The City should work with the local landlords association to review state landlord-­‐tenant law. The review should ascertain whether a better balance can be struck to protect fundamental tenant rights while allowing responsible landlords a reasonable opportunity to earn a return on investment. It could also look at ways to provide assistance to landlords to lessen their regulatory compliance costs. •
Consider establishing a “buy-­‐hold” fund. For properties that have the potential to go to a strong homebuyer but that are likely to be snapped up by an investor-­‐owner first, the City and/or partner nonprofits could consider establishing a fund to buy such properties, then market them to desirable buyers, along with tax and loan incentives. A nonprofit called Community Impact in Chattanooga, Tennessee was able to impact several dozen properties through this strategy. Set outcomes property by property; fund focused acquisition, rehabilitation and resale of key, strategic properties Within a revitalization target area, planners should set desired strategies and outcomes property-­‐by-­‐
property, at least for key blocks if not the entire 10-­‐15 block area. For example, 123 Elm Street (address is hypothetical) might be an owner-­‐occupied property that is likely coming on the market soon, and the outcome is to encourage a new homeowner to buy and repair it. For 124 Elm Street, perhaps the property is an investor-­‐owned property that has fallen into disrepair, and the outcome would be to facilitate the landlord making repairs to bring the property up to code and improve its external appearance. 125 through 130 Elm Street may all be stably owned-­‐occupied properties, but where encouraging owners to make small exterior improvements could enhance the overall image of the neighborhood. Neighborhood walk-­‐throughs, as well as detailed research on each property, can provide the information needed to decide on strategies and outcomes. Working with a developer – in most cities this is a nonprofit developer, although for-­‐profit developers can also be partners – to fund acquisition and rehabilitation of key properties will be the best strategy for properties where: •
The current owner is unwilling or unable to make repairs (e.g. foreclosed or vacant property, property owned by “absentee” investor-­‐owners with poor management practices) •
The property is having a significant negative impact on the neighborhood (e.g. it is a hot spot for crime) or could have a significant positive impact if rehabilitated (e.g. visible corner property that could attract a strong owner-­‐occupant after rehabilitation) The following general principles should be kept in mind when funding acquisition-­‐rehab work: 58 •
Acquisition and rehab for sale to an owner-­‐occupant is generally far preferable to acquisition-­‐
rehab-­‐rental, given the current skew towards rental housing in the revitalization neighborhoods. Given the marketability issues of small multifamily properties, acquisition-­‐rehab work should try to convert small multifamily properties to single-­‐family (or duplex or condo) properties whenever it is practicable to do so. The goal is to increase the quality of housing product available in the neighborhoods and thereby increase demand, not to increase the housing supply. •
Properties should be rehabilitated to a high standard that sets the tone for what the neighborhood should become and encourages neighboring owners to make similar improvements. •
Strategies for neighboring properties should be put into place to try to complement and extend the impact of the acquisition-­‐rehab project. This could be as simple as supporting a small event for neighbors to make landscaping improvements to their property. •
In some cases, there will be distressed multiunit properties that need to be addressed and where neither conversion to for-­‐sale housing nor demolition is appropriate. While one option is to provide financing or incentives for a private investor to take on the properties, the reality is that a nonprofit developer such as the Rutland Housing Trust can leverage significant financial resources and rehabilitate the property to a much higher level than is possible by any other means. Rehabilitation to a high standard is what is called for in a revitalization initiative, and so this option should continue to be on the table, despite the justifiable concerns of many private landlords who feel that they cannot compete with this nonprofit rental housing stock. We would recommend that: o
This type of development activity be limited to distressed properties that must be addressed to meet revitalization goals and where conversion to single-­‐family stock or demolition is clearly not an option o
Density should not be increased on building sites above current levels nor should infill construction of new rental housing be pursued (indeed, where practicable, reducing unit yields might be considered) o
Rehabilitation assistance be offered to the owners of privately-­‐held rental stock, as discussed earlier in this report, to extend the positive physical impacts of the project to these other properties and to help private landlords compete for good tenants o
Some consideration might also be given to tax credit lease-­‐purchase projects, in which tenants are offered the opportunity to purchase their units after the 15-­‐year Low-­‐
Income Housing Tax Credit period has expired. These structures can be complicated but have been pulled off with some success by groups such as the Cleveland Housing Network (www.chnnet.com). 59 o
Note that tax credit deals are typically structured to serve tenants at roughly 50 to 60 percent of Area Median Income (AMI) – current income limits for 2012 for 50 percent of AMI are $31,900 for a family of four and $25,550 for a two-­‐person household. (By comparison, the US Department of Health and Human Services poverty guideline for 2012 is $23,050 for a family of four and $15,130 for a two-­‐person household). Generally speaking, it would be beneficial for the target neighborhoods to attract households from higher income ranges than those served by a tax credit project, but a tax credit project would not be increasing the number of poor households, per se, in the area. Invest in and market the downtown and in key assets and amenities near the target area In the first public meeting, participants identified the unique strengths and amenities that are part of why they love to live in Rutland. Some key assets mentioned near revitalizing neighborhoods include: 1. Downtown Rutland. Continuing to create an exciting living and cultural environment in the downtown area could have a significant positive “spinoff” effect on neighborhoods that are physically well-­‐connected to it. An example of this type of investment is the Armory Square district of Syracuse, which has helped to increase interest in city living through the development of market-­‐rate apartments in rehabilitated factory buildings, restaurants, shopping, and a boutique hotel. The district helps to create a bridge between downtown and one of the city’s key target areas for revitalization, the Near West Side. 2. East Creek and Otter Creek. The waterways passing through Rutland are unique assets upon which much of the town appears to have turned its back, physically speaking. If planning efforts are not already underway, some consideration might be given to establishing greenways, including bike and pedestrian pathways, along these waterways. 3. The proposed year-­‐round Farmer’s Market location just west of the core neighborhoods could also help to attract a new clientele to buy or rent in these neighborhoods. Encourage and support community development nonprofits to refocus their work in ways that will better spur neighborhood revitalization. Rutland is very fortunate to be served by two capable nonprofit community development organizations, the Rutland Housing Trust and NeighborWorks of Western Vermont. Neither organization has truly engaged in what the consultants would term a revitalization initiative in some years – nonprofits doing this work typically invest heavily in community building and organizing, neighborhood marketing, and other “soft” programming, and focus their development and lending activities in highly specialized ways that respond directly to resident and neighborhood concerns. The Housing Trust has focused principally on the development of affordable rental housing – in the process, rehabilitating a number of distressed properties in Rutland – and NeighborWorks has focused mainly on regional homeownership and home improvement programming, and has also rehabilitated some properties for owner-­‐occupancy in 60 Rutland. Both organizations have tremendous value to bring to a neighborhood revitalization initiative. Potential roles one or both organizations could be asked to play include: •
Community building and organizing •
Coordination of neighborhood marketing •
Operation of specialized loan programs for home purchase and rehabilitation •
Targeted redevelopment of strategically selected properties •
Property management services to assist landlords with tasks such as tenant selection, renter readiness education for prospective tenants, and regulatory compliance Support “big picture” planning efforts that can change the context in which we are seeking to revitalize neighborhoods The health of a neighborhood is obviously impacted by the overall health of the region and of the government jurisdictions in which it lies. A full consideration of these issues is beyond the scope of this report. We do recommend, however, that additional planning efforts be pursued, as needed and appropriate, to advance comprehensive regional (not just local) strategies that address a range of important areas for the future of Rutland, such as: economic and workforce development, land use planning, regional collaborations between local governments, environmental preservation, transportation and infrastructure investments, arts and culture, food systems, public health, recreation and education. The US Department of Housing and Urban Development’s Sustainable Communities Regional Planning Grants Program was developed precisely out of the recognition that the factors impacting long-­‐term regional and neighborhood health are complex and interrelated, and are best addressed in a comprehensive way. The program provides funding for multijurisdictional planning efforts; more information is available at: http://portal.hud.gov/hudportal/HUD?src=/program_offices/sustainable_housing_communities/sustain
able_communities_regional_planning_grants Cost estimate and resources for a revitalization initiative To provide some idea of the operational costs that might be involved in a revitalization initiative, we have put together an approximate budget for an initiative that: •
Employed a neighborhood coordinator (ideally at a neighborhood association or community development nonprofit) to lead community-­‐building, revitalization planning, and neighborhood marketing efforts •
Engaged local nonprofits to run a rehab loan fund and provide some level of technical assistance to small landlords with property management issues •
Engaged a “Realtor® on Retainer” to assist with neighborhood marketing 61 •
Created marketing collateral and a website, and supported a modest level of event programming •
Ran a small mini-­‐grants program to support neighborhood improvement ideas designed and implemented by neighborhood leaders •
Provided development subsidies – averaging $40,000 per property – for ten acquisition/ rehabilitation/resale projects per year. Operational costs are estimated in the table below, suggesting that a comprehensive, three-­‐year initiative might carry total costs on the order of $1.8 million. Operational expenses Neighborhood coordinator salary Estimated cost (approximate) Year 1 Year 2 Year 3 $35,000 $35,000 $35,000 Neighborhood coordinator fringe and overhead $17,500 $17,500 $17,500 Rehab loan program construction manager (0.5 FTE rehab project manager -­‐ salary /fringe / overhead) $26,000 $26,000 $26,000 Property management assistance personnel (0.5 FTE, salary/fringe/overhead) $26,000 $26,000 $26,000 "Realtor on Retainer" honorarium $7,500 $7,500 $7,500 Marketing collateral $2,500 $2,500 $2,500 Website development / maintenance $15,000 $2,500 $2,500 Events $2,500 $2,500 $2,500 Mini-­‐grants for neighborhood leadership $2,500 $2,500 $2,500 Subtotal, operational expenses $134,500 $122,000 $122,000 Acquisition-­‐rehab-­‐resale subsidies Property development subsidies (average of $40,000 per property, 10 properties/yr) Selective demolition (average of $15,000 per property, 5 properties/yr) Subtotal, real estate expenses Total annual expenditures $400,000 $400,000 $400,000 $75,000 $475,000 $75,000 $475,000 $75,000 $475,000 $609,500 $597,000 $597,000 In addition to these expenditures, we would also recommend that state or local (non-­‐federal) resources be identified to provide $500,000 of loan capital to prime a rehab loan fund. This capital could then be used to leverage federal resources (for example, through the CDFI Fund) and bank community 62 investment capital to create a $2 million fund, sufficient to provide 100 rehab loans at an average amount of $20,000. The loan fund would revolve so that over the years, additional borrowers could be served. Resources for acquisition/rehabilitation/resale subsidies would need to come largely from government sources (such as VHCB, VCDP or other HUD resources including Neighborhood Stabilization Program funds if future rounds are made available). Some level of private funding might obtained from community-­‐oriented sources, such as the Federal Home Loan Bank’s Affordable Housing Program. These same sources – plus additional sources such as the Low Income Housing Tax Credit – could be available in the event that an appropriate rehabilitation project for rental purposes is structured. Resources for truly operational expenses of a revitalization initiative are much harder to fund. This is an area where City funding, to the extent it is available, has an invaluable role to play. Some amount of operational funding could potentially be obtained from federal grant sources, especially when nonprofit organizations are the entities with the expenditures, but at the end of the day, resource development work – raising donations from businesses, individuals, and philanthropies who care about the future of Rutland and the region – is likely to be required. Use a triage approach to maximize impact on vacant/blighted housing To maximize the impact of limited resources, the City of Rutland should utilize a triage approach to determining whether and how to intervene in vacant residential buildings. The decision should take into account the type of neighborhood where the building is located, the immediate physical surroundings of the building, and the physical qualities and condition of the home itself. We offer the following decision matrix to help guide this process: Step 1. Neighborhood type where building is located. •
If the building is located in a stable neighborhood with strong ownership characteristics (which includes most areas east of Route 7), let the market take care of the problem. City officials should inquire with the property seller or Realtors about whether there are legal issues preventing the property transfer with which they can assist, but should not spend public resources on acquiring and rehabilitating the building. •
If the building is located in a transitional neighborhood or a revitalization area, proceed to Step 2. Step 2. Historical or architectural significance •
If the building is of significant historical or architectural importance (e.g. on the historic register, in a historic district, or a particularly fine example of an important architectural style), plans should be made and resources sought for the preservation of the building. Rutland’s historical character is one of its prime marketing strengths and the investment in preservation will pay off by having a more unique community to offer prospective employers and residents. Whenever practicable, such buildings should be restored in such a 63 way as to maximize their historic / architectural value. Consideration should be given to deconverting historic homes that have been “cut up” into multiple units back into single-­‐
family properties. Step 3. Locally Undesirable Land Uses •
If the building is located in an area prone to flooding, it should be demolished and converted to green space. Inquiries should be made as to whether flood hazard mitigation funds are available to support these costs. •
If the building is located adjacent to a high-­‐traffic corridor, inquiry should be made as to whether there is interest in it as a commercial use. If the physical conditions or characteristics (e.g. lack of parking) of the building make it unappealing to private market investors for commercial use, the building should be demolished. Consider creating green space to help buffer other adjacent residential uses from the traffic corridor. •
If the building is located adjacent or close to a land use that could reasonably be expected to cause significant concerns to a homebuyer – such as a prison, an industrial use, a rooming house, or another vacant or dilapidated building – can the impacts of the nearby undesirable use be mitigated at a reasonable cost, to a level where it is reasonable to expect the property will be marketable? (E.g. could management policies at the rooming house be strengthened, could a landscaped buffer created between the home and the factory, could a cluster of buildings be acquired and rehabilitated to eliminate the negative effects they are having on one another and instead create a new node of neighborhood strength, etc.) If not, demolish the property and utilize the space to buffer nearby homes from the problematic land use. If mitigation is possible, proceed to the next step. Step 4. Cost of rehabilitation versus after-­‐rehab market value (appraisal gap). •
If the cost of rehabilitation is moderate (one rough guide might be to use a figure of under $30,000, but this is only an approximation), consider providing incentives in the forms of loans and/or tax abatements, as well as assistance in marketing the property, to facilitate the sale of the property to a responsible owner and its rehabilitation. For multi-­‐unit properties, this could include purchase / rehab loans to landlords. For single-­‐family or duplex properties, this could include not only a purchase/rehab financing package but also a property tax abatement for the owner occupant. Deeper incentives (e.g. lower interest rates on the loan, deeper tax abatements) could be provided for properties located in neighborhoods that are the subject of a focused revitalization initiative. •
If the cost of rehabilitation is more substantial, and an appraisal gap is expected on the property (i.e. the after-­‐rehab market value is insufficient to recapture the total costs of acquisition and rehabilitation), the strategic importance of the property should be assessed. Step 5. Strategic importance and visibility of the property for the neighborhood 64 For vacant properties reaching this step of the decision tree -­‐ properties with substantial rehabilitation needs located in transitional or revitalizing neighborhoods -­‐ a more nuanced evaluation is required to determine the strategy for the building. The following questions should be explored: •
Is the property located in a revitalization initiative target area? Is it in a particularly visible or important location within the neighborhood and/or is it a source of chronic safety problems in the neighborhood (e.g. frequented by drug sellers or users, etc.)? If the answer to these questions is yes, the property should be a priority for action even if substantial public subsidies are required. A rehabilitation cost estimate should be developed and broker price opinion sought for various alternatives for the property. •
•
o
Prioritize acquisition/rehab and resale to an owner occupant if the property can be feasibly converted to single-­‐family, duplex or condo use. o
Consider demolition if the appraisal gap is such that it would be cheaper (specifically meaning, it would require less public subsidy) to demolish and build a new home. Consider conversion to green space with the demolished property if the adjacent owner(s) would be interested in owning and maintaining the lot (which could be sold to them at a greatly reduced price), or if the property would be highly suitable for use as a pocket park or community garden and capacity is in place (in the neighborhood and/or within local government) to support that use. If green space is not an option, build an infill home instead – to a high standard that will help to set the tone for the neighborhood. If a grouping of strategically important vacant or dilapidated properties is found where deconversion to homeownership housing types (e.g. single family, condo, duplex) is not feasible, demolition is not desirable, and a critical mass of units can be reached, acquisition-­‐
rehab-­‐rental should be considered. If the property is not located in a revitalization target area or not strategically important to the revitalization of a target area: o
Seek to market the property with a purchase-­‐rehab loan and tax stabilization package to potential owner-­‐occupants or responsible investor-­‐owners o
If, despite the high cost of rehabilitation, the property can be rehabilitated and sold at a price with only a small subsidy (no more than the cost of demolition, so perhaps an appraisal gap of less than $15,000 in most cases), then ask a nonprofit developer to do so o
If the property is not likely to be marketable through either of the above two strategies, demolish the property and either land bank it (city ownership of the lot for potential sale to a future developer for infill housing) or seek to convey the lot to the adjacent owner(s) if they are willing to maintain it. 65 Distressed Property Interven0on Decision Tree Located
in strong no neighborhood?
yes Let the
market
create the
solution
Historic
or arch.
significance?
yes Historic
rehab
project
no LULU
impacts?
yes Feasible
to
mitigate?
no Demolish
and
create
buffer
no yes Moderate
rehab
cost?
no In target no revitalization
area?
Marketable with
incentives?
no Rehab
appraisal
gap <
demo
cost?
yes yes yes yes Incentives for
purchaserehab
Rehab
appraisal
gap <
demo +
infill cost?
Incentives for
purchaserehab
Acquisition /
rehab /
resale
yes Acquisitionrehab-resale
project; or
rental project if
part of a cluster
of multi-unit
properties
no Demo
and land
bank
no Demolish
and
create
green
space or
build infill
Tackle affordable housing challenges holistically and regionally Data from this housing needs assessment indicate that: 1. The households facing real challenges with housing affordability have very low incomes, with the worst challenges faced by households with incomes under $20,000 and affordability challenges generally limited to households earning less than $35,000. (The one exception to this rule is homeowners who stretched themselves to buy a home during the peak market years and/or have experienced income or mortgage payment shocks). A sustainable solution to addressing the needs of these low-­‐income populations needs to work on the employment and income side of the equation as well as the housing price side of the equation. 2. Both low-­‐income households and affordable housing stock are concentrated within Rutland, out of proportion to Rutland’s share of jobs and households. This dynamic raises important fair housing concerns – low-­‐income households should have a choice about where to live in a region, including the choice to live near their job and in a school district that they feel is best for their children. It also raises concerns for neighborhood health, particularly insofar as poverty rates in some Rutland neighborhoods are reaching the levels of what some researchers would consider to be “high poverty” neighborhoods. As discussed earlier, these neighborhoods have significant negative effects on the life chances of the people who live in them, as well as effects 66 on raising local government costs, reducing private sector investment, and even reducing regional house prices.8 3. The fundamentals of housing demand – employment and households – have been in a long period of moderate decline, and the future expectation would also be for a steady-­‐state to moderate decline for future demand. Vacancy levels are currently basically healthy to slightly soft. It is therefore important not to confuse helping low-­‐income households to surmount housing affordability challenges with creating new housing supply (affordable or otherwise). The former is needed; the latter is not. The action implications of these findings are as follows: •
Future affordable housing creation needs to focus on the very-­‐low-­‐income population, specifically on households earning less than $20,000 per year. Achieving this goal will be challenging given the dearth of government subsidies, including cutbacks of the key federal programs including HOME, CDBG, and public housing. •
Future affordable housing creation needs to improve fair housing choice for low-­‐income populations. Specifically, additional affordable housing units serving very-­‐low-­‐income households (below 50 percent of AMI) should not be created in the two high-­‐poverty census tracts in Rutland (9631 and 9632). Instead, they should be located in low-­‐poverty, high-­‐
opportunity areas across the region. By “high opportunity,” we specifically mean areas with excellent schools, excellent community amenities, and access to jobs. A limited number of tax credit units serving tenants at 50 to 60 percent of AMI could be considered in target revitalization areas, exclusively to the extent that they address distressed multifamily properties whose rehabilitation is critical to meeting revitalization goals and where demolition or conversion to single-­‐family stock are not appropriate options (see the earlier discussion on this topic in the recommendations on neighborhood revitalization). •
Future affordable housing creation should avoid adding significant net new units to the stock, when possible, given flat to declining expectations for future overall housing demand. Conversion of existing stock to affordable housing is a good option to pursue when a feasible opportunity can be identified. •
Initiatives to boost employment and earnings are critically important to meeting the needs of those working-­‐age households who face “affordability” challenges. The City of Rutland, and other local, regional, and state governmental agencies, should seek to maximize investment in a variety of programs including employment and training, business retention and attraction, and 8
For a full discussion of these effects, see: see: Kneebone, Nadeau and Berube (2011). “The Re-­‐
Emergence of Concentrated Poverty: Metropolitan Trends in the 2000s.” Brookings Institution, Metropolitan Opportunity Series. 67 employment supports (e.g. child care, transportation) to enhance the opportunities for working-­‐
age low-­‐income households to find employment at living wages. 68 Appendix Appendix I: Maps A. City of Rutland Land Use & Vacant Structure Map B. Land Use Map C. Tenure by Parcel Map D. Investor Owned Single & Two Family Homes E. Vacant Structures near Undesirable Land Uses F. Lis Pendens Filed G. Recommended Revitalization Focus Areas 69 N Churc
Recommended
Revitalization
Focus Area
Rutland, VT
h St
Exete
r Rd
Field Ave
Nicole Pl
City Dump Rd
3-Family
4-Family
Apartments (5+ Units)
Hilltop Ter
Robinwood Ln
Mobile Home
Commercial
Exempt
Industrial
Central Ave
n
Agricultural
Gilrain Ave
South
Utilities
e rn B
C
Ave
B
Ave
Ave A
yL
Perr
MISC Land
Sonia Dr
ve
son A
Jack
St
Madison
lvd
Common St
a
Freem
Rooming Houses
n Ave
Ma h
oney
St
Ivy
r Pl
Porte
n St
Alle
A ve
963300
Alta Ter
Foster Pl
r
Eng
ve
em A
t
t St
Mu s
ve
nA
te
Ot
St
Dr
s ey
D o rr
so
Gib
St
2-Family
Elmwood Dr
l
Po s
Plain
Dr
brook
Dr
erine
Cath
lvd
etti B
Giorg
Upland Dr
Mo o n
Woodland Dr
rk
Dr
od Dr
Dr
y Ave
Rachel Dr
o Ct
St
e
Dr
Ronald
rl
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rd Av
ont
1-Family
Grandview Ter
p o rt
St
ton St
Howa
dm
Pie
Land Use Map
Irving Hts
Sharon Dr
Victor Pl
New
ve
ton A
n
Hill Pond Rd
St
t Pa
Healy L
Brentw
o
963000
Stratton Rd
Orchard Dr
Geno Ave
Preville
Ave
Fairview Ave
Rd
e
Av
outh
t
Morse P
t St
ve
sA
ant S
Pleas
ng
Prospec
Shedd Pl
Hillside
City Parcels
ly Ave
r St
Hopkins St
e
Av
e
e r St
al
c
Clov
S
ck
Butterf
nter
Transitional Areas
no data/unsure
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St
Lafayette St
t
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l
ool Rd
St
rt o n
Ave
wood
Birch
es St
l St
Charl
Terril
shing
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Ter
ma n
Spell
Royce St
View Ln
ont
Trem
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S Main S
E Cente
Mountain
Clark St
Ave
Pl
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Dr
NE Sch
Ave
Deer St
Bellevue
Court Sq
St
St
sfield
Wendy Ln
Northeast
ll
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St
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ge
oo
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to
ds
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t
iP
Revitalization Area
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Sto
Center
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t
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k
t
ve
ood A
s
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Dr
±
e
rk
S
Hayw
l
Curtis Ave
rk
Messier P
Ave
ve
Marble A
Chase Av
Coolidge
Dana Ave
Pa
Ave Brookside Mobile
Pa
Rd
d Dr
Ln
Alt
ru
ll
Ca
Merrill St
ton St
Washing
ro
St
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s
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ell
Elm St
ts Row
lin
James St
South St
nk
St
Brown St
Forest St
mp
b
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St
St
e
Rice Ave
Rd
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m en
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woo
n St
C
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Aiken Pl
US Hwy
we
Chaffee Av
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lyn
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St
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Ho
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a
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Bur
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Robbins St
Ave
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Roberts
Pine St
n Rd
High St
Ave
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St
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Meadow St
e
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L
st Rd
Davis
Seabury
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e
Melrose Av
Clinton
ve
Library A
t
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Ave
t
Water S
Smith St
e
int Av
tt Ave
Ripley
t St
Wes
n
Hillcre
Wood Ave
t St
Crescen
St
ve
tus A
Emeri
N Main St
Holly St
North St
Oak St
Cleveland
Pierpo
Emme
Evergreen Ave
Hazel St
Watkins Ave
mton Ave
Crampton Ave Cra
Shepard Ln
C
m
olu
a
bi
t
Vernon S
t
Ash St
Linden St
Park Ave
Ct
Kingsley
State St
olin
Ma r
Ln
Walnut St
Oak St Exd
US Hwy 7
Phillips St
Adams S
Pearl St
Meadow
ve
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Grove St
Mayfield Rd
t
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963200
t
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ia
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Q1 - Q2 2012 - 28 Records Filed
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rly
( Te
(!
(!
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(
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l
P
!
sfield
(
West St
Man
e
int Av
Pierpo
tt Ave
Emme
!
(
!
(
Evergreen Ave
!
(
( !
Hazel St
Watkins Ave
Cra mton Ave
She pard Ln
Cl
em
en
tR
!
(
!
(
!
(
N Main S
Pearl St
!
(
e
tus Av
Emeri
Dr
st Rd
dow
Hillcre
Mea
!
(
Tuttle
Exd
h St
Nort
ay
eW
!
( Calli
St
rson
Jeffe
t
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High St
!
(
(
!
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Orchard Dr
t
Northeast
!
(
St!
Vernon (
!
(
S
olin
Mar
t
Vernon S
ve
Lincoln A
t
Adams S
t
Church S
Grove St
!
(
!
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US Hwy 7
t
Phillips S
!
(
ia
Patric
!
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Victor Pl
Rd
(Ave
Field!
!
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Jan Ave
9632
Lis Pendens Filed
in Rutland City
2006 - Q2 2012
h St
r
Exete
N Churc
!
(
!
(!
(
0
0.2
0.4
0.8 Miles
N Churc
Vacant Structures
and Undesirable
Land Use
h St
r
Exete
ia Ln
Patric
Victor Pl
City Dump Rd
2-Family
Rach el Dr
Grandview Ter
Stratto n Rd
Irving Hts
Sharo n Dr
Nicole Pl
Dr
erine
Cath
lvd
ett i B
Giorg
Upla nd Dr
3-Family
4-Family
Apartments (5+ Units)
Mobile Home
Hilltop Ter
Robinwood Ln
Alt a Ter
Fo ster Pl
e
Preville
Ave
1-Family
Hill Pond Rd
Commercial
Exempt
Sonia Dr
rP
Porte
l
n
Alle
Gilrain Ave
Ave
Utilities
Rooming Houses
Perkins Rd
Hayw
Curtis
Horton S
t
Chase Ave
ve
Marble A
an Ave
Freem
St
y St
k
ee
Cr
Chaplin
MISC Land
Agricultural
se
Mus
ter
Ot
ll
e Wa
Industrial
Central Ave
e
Common St
Scale A
v
Newpo rt Dr
Fairview Ave
Geno Ave
t
nS
Joh
Land Use Map
n
Woodland Dr
lvd
r
nt
Sai
Ave
Healy L
B
hern
Sout
St
St
ger
Gran
Fo re st St
Dorr D
200 Foot Buffer - Undesirable Land Uses*
Rd
Shedd Pl
Vacant Structures
no data/unsure
ly Ave
Butterf
C
Ave
e
Av
B
Ave
y Ln
Perr
t
St
Park
e
Dana Av
Gleason Rd
l
Elmwood Dr
t
er S
Clov
iP
City Parcels
e
rly Av
Easte
v
son A
Jack
Royce S
30 vacant structures out of 152 vacant
structures are adjacent to land uses
that are not desirable for residential property.
Hillside
t
Ave
rem
Eng
Ave A
s
ng
ro
St
t
ce
Spru
tS
Pos
Brown St
son
Gib
Ave
St
Ave
ard
How
Lafayette St
t
East S
l
Morse P
t
S Main S
n St
hingto
E Was
l
on P
lS
Terril
ve
kA
Nels
on
ingt
Harr
St
Madison
South St
l Rd
NE Schoo
Ave
Clark St
e
Ives Av
l
Alt
ru
y
Wa
c
to
ds
oo
W
Deer St
St
Court Sq
ton St
Washing
St
n St
erto
Edg
Pl
sfield
Man
r St
E Cente
St
Center
llie
Ca
ll
Thra
ve
Bellevue A
Davis
Norton P
St
Wales St
St
St
St
1st
Nichols
t
Cottage S
ts Row
Merchan
Pl
Traverse
rson
Jeffe
Ct
Park
t Exd
t
ple S
Tem
Aiken Pl
West St
Plain
Ston
t
t
we
Ho
r
S
Williams
Elm St
t
Summer S
Pine St
D
ge
Ri d
Ave
Burnham
Willow St
Mead ow St
ne
Sto
N Main S
Pearl St
t
Robbins S
River St
d
ve
Kendall A
ve
Library A
n
kli
an
r
F
d
Ca
mp
be
ll R
ve
Roberts A
ve
Library A
Maple St
Rd
Ave
Ave
Kingsley
e
Park Av
Ct
Kingsley
t
Baxter S
d Ave
Clevelan
t
Water S
e
int Av
Pierpo
tt Ave
Emme
Hazel St
Evergreen Ave
Watkins Ave
Cra mton Ave
She pard Ln
Cl
em
en
tR
Ri
ple
y
Clinton
St
Seabury
School St
High St
Wood Ave
t St
Crescen
ve
nA
bia
Bus
lum
wy 4
Co
US H
Smith St
Ave
Melrose
Oak St
State St
d
en R
Beld
North St
Holly St
Ash St
Walnut St
Dr
dow
Mea
hS
Nort
Laverne Dr
Orchard Dr
Dr
Tuttle
Northeast
H
e
tus Av
Emeri
Rd
illcrest
Wendy Ln
US Hwy 7
d Rd
rwoo
St
She
olin
Mar
t
Vernon S
ve
Lincoln A
t
Adams S
Grove St
St
Vernon
t
Church S
Jan Ave
t
Phillips S
Rd
Field Ave
ve
ood A
Ave
s
Billing
Dr
* Undesirable Land Uses include
Route 7 and West Street corridors,
industrial uses, prisons, rooming houses,
and flood-prone areas.
0
0.2
0.4
±
0.8 Miles
N Churc
City of Rutland
Owner Occupants
and
Investor Owners
h St
r
Exete
Stratto n Rd
Preville
Ave
Fairview Ave
Geno Ave
City Dump Rd
Dr
erine
Cath
lvd
ett i B
Giorg
Upla nd Dr
Hilltop Ter
Robinwood Ln
Alt a Ter
Fo ster Pl
e
Rach el Dr
Grandview Ter
Nicole Pl
Scale A
v
Sharo n Dr
Sonia Dr
Gilrain Ave
l
n
Alle
Common St
r
Newpo rt Dr
Non-Residential
Irving Hts
Central Ave
e
lvd
rP
Porte
Dorr D
Rd
Investor Owned
n
Woodland Dr
B
hern
Sout
B
Ave
y Ln
Perr
t
Perkins Rd
y St
ter
Ot
ll
e Wa
k
ee
Cr
Chaplin
Ave
Hayw
Curtis
Horton S
ve
ood A
±
Ave
s
Billing
Dr
t
Chase Ave
ve
Marble A
an Ave
Freem
St
se
Mus
St
Park
e
Dana Av
City Parcels
Hill Pond Rd
ly Ave
Butterf
Shedd Pl
Hillside
ve
ard A
Healy L
e
rly Av
Easte
C
Ave
t
e
Av
963300
Census Tracts
Elmwood Dr
Ave A
s
ng
ro
St
St
St
ger
Gran
Fo re st St
Ave
t
ce
Spru
tS
Pos
Brown St
son
Gib
St
Ave
v
son A
Jack
er S
Clov
Gleason Rd
l
Tenure
963000
l
on P
t
Ave
rem
Eng
Royce S
iP
Owner Occupied
Nels
How
Lafayette St
t
East S
t
S Main S
St
l
Morse P
we
Ho
St
1st
l Rd
NE Schoo
Ave
Clark St
e
Ives Av
Court Sq
St
Wales St
n St
hingto
E Was
e
Av
on
ingt
Harr
St
Madison
South St
St
ck
to
ds
oo
W
Deer St
St
lS
Terril
Pl
sfield
Man
r St
E Cente
ton St
Washing
St
n St
erto
Edg
l
Norton P
St
y
Wa
llie
Ca
ll
Thra
ve
Bellevue A
Davis
Nichols
t
Cottage S
ts Row
Merchan
Center
rson
Jeffe
Ct
Park
Alt
ru
t Exd
ple
Tem
Aiken Pl
West St
St
Plain
Ston
Elm St
t
Summer S
Pine St
r
t
Pl
Traverse
Mead ow St
D
ge
Ri d
S
Williams
Willow St
Rd
ne
Sto
ve
Kendall A
Ave
Burnham
t
Robbins S
River St
d
963100
n
kli
an
r
F
d
Ca
mp
be
ll R
ve
Roberts A
ve
Library A
Maple St
School St
Ave
Ave
Kingsley
St
Seabury
e
Park Av
Ct
Kingsley
t
Baxter S
d Ave
Clevelan
t
Water S
e
int Av
Pierpo
tt Ave
Emme
Hazel St
Evergreen Ave
Watkins Ave
Cra mton Ave
She pard Ln
Cl
em
en
tR
Ri
ple
y
Smith St
Clinton
t St
Crescen
ve
nA
bia
Bus
lum
wy 4
Co
US H
High St
Wood Ave
Oak St
State St
d
en R
Beld
Ave
Melrose
t
Walnut St
N Main S
Pearl St
hS
Nort
North St
Holly St
Ash St
963200
Dr
dow
Mea
Victor Pl
Orchard Dr
Laverne Dr
Tuttle
Dr
H
e
tus Av
Emeri
Rd
illcrest
Northeast
d Rd
rwoo
St
She
olin
Mar
Wendy Ln
US Hwy 7
St
Vernon
ia Ln
Patric
t
Vernon S
ve
Lincoln A
t
Adams S
Grove St
t
Church S
Jan Ave
t
Phillips S
Rd
Field Ave
0
0.2
0.4
0.8 Miles
N Churc
Investor Owned
Single and Two
Family Homes
h St
r
Exete
e
Scale A
v
Stratto n Rd
Victor Pl
Preville
Ave
Fairview Ave
Geno Ave
City Dump Rd
Hilltop Ter
Robinwood Ln
Alt a Ter
Fo ster Pl
Sonia Dr
Gilrain Ave
l
n
Alle
Common St
r
Nicole Pl
Dr
erine
Cath
lvd
ett i B
Giorg
Upla nd Dr
Central Ave
e
lvd
rP
Porte
Dorr D
Rach el Dr
Woodland Dr
B
hern
Sout
y Ln
Perr
t
Perkins Rd
y St
ter
Ot
ll
e Wa
k
ee
Cr
Chaplin
Ave
Hayw
Curtis
Horton S
ve
ood A
±
Ave
s
Billing
Dr
t
Chase Ave
ve
Marble A
an Ave
Freem
St
se
Mus
St
Park
e
Dana Av
Irving Hts
Sharo n Dr
Grandview Ter
ve
ard A
n
Hill Pond Rd
ly Ave
Butterf
B
Ave
e
Av
963300
C
Ave
t
Ave A
s
ng
ro
St
Ave
St
St
ger
Gran
Fo re st St
son
Gib
St
t
ce
Spru
tS
Pos
Brown St
St
1st
Ave
v
son A
Jack
er S
Clov
Other Parcels
Elmwood Dr
St
Madison
South St
City Parcels
Investor Owned 2-Family
Healy L
e
rly Av
Easte
Ave
rem
Eng
Royce S
Newpo rt Dr
t
l
Rd
How
iP
Investor Owned
963000
l
on P
on
ingt
Harr
Lafayette St
t
East S
n St
hingto
E Was
ve
kA
Census Tracts
Gleason Rd
Investor Owner 1-Family
Nels
e
Ives Av
t
S Main S
l
Morse P
ton St
Washing
c
to
ds
oo
W
Deer St
St
lS
Terril
Pl
sfield
Man
r St
E Cente
St
l Rd
NE Schoo
Ave
Clark St
Davis
Court Sq
Shedd Pl
ll
Thra
ve
Bellevue A
t
Center
St
n St
erto
Edg
l
Norton P
St
Wales St
St
St
Plain
Ston
Nichols
t
Cottage S
ts Row
Merchan
Pl
Traverse
ple
Tem
Aiken Pl
West St
we
Ho
r
t
Willow St
Mead ow St
D
ge
Ri d
S
Williams
Elm St
t
Summer S
t
Robbins S
Rd
ne
Sto
ve
Kendall A
Ave
Burnham
ve
Library A
Maple St
River St
d
963100
n
kli
an
r
F
d
Ca
mp
be
ll R
ve
Roberts A
e
Park Av
Ct
Kingsley
School St
Ave
Ave
Kingsley
St
Seabury
Pine St
ve
nA
bia
Bus
lum
wy 4
Co
US H
High St
Clinton
t St
Crescen
t
Baxter S
d Ave
Clevelan
t
Water S
e
int Av
Pierpo
tt Ave
Emme
Hazel St
Evergreen Ave
Watkins Ave
Cra mton Ave
She pard Ln
Cl
em
en
tR
Ri
ple
y
Ave
Melrose
Wood Ave
Oak St
State St
Smith St
N Main S
Pearl St
Walnut St
d
en R
Beld
North St
Holly St
Ash St
963200
Alt
ru
Hillside
Dr
dow
Mea
le
t
t
u
T
Exd
h St
y
Nort
Wa
llie
Ca
St
rson
Jeffe
Ct
Park
Orchard Dr
Laverne Dr
e
tus Av
Emeri
Rd
illcrest
Dr
H
Northeast
d Rd
rwoo
St
She
olin
Mar
Wendy Ln
US Hwy 7
St
Vernon
ia Ln
Patric
t
Vernon S
ve
Lincoln A
t
Adams S
Grove St
t
Church S
Jan Ave
t
Phillips S
Rd
Field Ave
0
0.2
0.4
0.8 Miles
N Churc
City of Rutland
Land Use Map
h St
r
Exete
Stratto n Rd
Preville
Ave
Fairview Ave
Geno Ave
City Dump Rd
Dr
erine
Cath
lvd
ett i B
Giorg
Upla nd Dr
Commercial
Exempt
Industrial
MISC Land
Hilltop Ter
Robinwood Ln
Alt a Ter
Fo ster Pl
e
Mobile Home
Rach el Dr
Grandview Ter
Nicole Pl
Scale A
v
Sharo n Dr
Agricultural
Utilities
l
n
Alle
Gilrain Ave
Perkins Rd
y St
k
ee
Cr
Chaplin
Ave
Hayw
Curtis
Horton S
ve
ood A
±
Ave
s
Billing
Dr
t
Chase Ave
ve
Marble A
an Ave
Freem
St
se
Mus
ter
Ot
ll
e Wa
Rooming Houses
Central Ave
e
Common St
r
Apartments (5+ Units)
Irving Hts
Sonia Dr
lvd
rP
Porte
Dorr D
Newpo rt Dr
Shedd Pl
Rd
4-Family
n
Woodland Dr
B
hern
Sout
y Ln
Perr
t
St
Park
e
Dana Av
1-Family
Hill Pond Rd
ly Ave
Butterf
B
Ave
C
Ave
t
Ave A
St
963300
Land Use Map
Elmwood Dr
e
Av
t
St
ger
Gran
Ave
s
ng
ro
St
tS
Pos
ce
Spru
Fo re st St
son
Gib
St
Healy L
e
rly Av
Easte
Lafayette St
t
East S
t
S Main S
l
Morse P
St
Brown St
St
1st
963000
Ave
v
son A
Jack
er S
Clov
no data/unsure
2-Family
ve
ard A
How
Ave
rem
Eng
Royce S
Gleason Rd
l
Hillside
on
ingt
Harr
l St
Terril
n St
hingto
E Was
e
Av
l
on P
l
iP
3-Family
Nels
ck
to
ds
oo
W
St
Madison
South St
l Rd
NE Schoo
Ave
Clark St
e
Ives Av
Court Sq
St
Wales St
ton St
Washing
St
n St
erto
Edg
Pl
sfield
Man
r St
E Cente
St
Center
St
Deer St
St
Norton P
y
Wa
llie
Ca
ll
Thra
ve
Bellevue A
Davis
Nichols
t
Cottage S
ts Row
Merchan
Elm St
t
Summer S
St
rson
Jeffe
Ct
Park
Alt
ru
t Exd
ple
Tem
Aiken Pl
West St
Pl
Traverse
Plain
Ston
t
we
Ho
r
S
Williams
Willow St
Mead ow St
D
ge
Ri d
ve
Kendall A
Ave
Burnham
t
Robbins S
Rd
ne
Sto
t
963100
ve
Library A
Maple St
River St
d
ve
Roberts A
e
Park Av
Ct
Kingsley
School St
Ave
Ave
Kingsley
St
Seabury
n
kli
an
r
F
d
Ca
mp
be
ll R
Clinton
Pine St
ve
nA
bia
Bus
lum
wy 4
Co
US H
High St
Wood Ave
t St
Crescen
t
Baxter S
d Ave
Clevelan
t
Water S
e
int Av
Pierpo
tt Ave
Emme
Hazel St
Evergreen Ave
Watkins Ave
Cra mton Ave
She pard Ln
Cl
em
en
tR
Ri
ple
y
Ave
Melrose
Oak St
State St
Smith St
N Main S
Pearl St
Walnut St
d
en R
Beld
North St
Holly St
Ash St
963200
Dr
dow
Mea
hS
Nort
City Parcels
Victor Pl
Orchard Dr
Laverne Dr
Tuttle
Census Tracts
Dr
H
e
tus Av
Emeri
Rd
illcrest
Northeast
d Rd
rwoo
St
She
olin
Mar
Wendy Ln
US Hwy 7
St
Vernon
ia Ln
Patric
t
Vernon S
ve
Lincoln A
t
Adams S
Grove St
t
Church S
Jan Ave
t
Phillips S
Rd
Field Ave
0
0.2
0.4
0.8 Miles
N Churc
City of Rutland
Land Use and
Vacant Structures
h St
r
Exete
Stratto n Rd
Victor Pl
Preville
Ave
Fairview Ave
Geno Ave
City Dump Rd
Dr
erine
Cath
lvd
ett i B
Giorg
Upla nd Dr
Apartments (5+ Units)
Mobile Home
Commercial
Exempt
Hilltop Ter
Robinwood Ln
Alt a Ter
Fo ster Pl
e
Rach el Dr
Grandview Ter
Nicole Pl
Scale A
v
4-Family
Industrial
MISC Land
Sonia Dr
l
n
Alle
Rooming Houses
Ave
Perkins Rd
Hayw
Curtis
Horton S
ve
ood A
±
Ave
s
Billing
Dr
t
Chase Ave
ve
Marble A
an Ave
Freem
St
y St
k
ee
Cr
Chaplin
Utilities
Gilrain Ave
se
Mus
ter
Ot
ll
e Wa
Agricultural
Central Ave
e
Common St
r
Newpo rt Dr
3-Family
Irving Hts
Sharo n Dr
Woodland Dr
lvd
rP
Porte
Dorr D
2-Family
n
Hill Pond Rd
B
hern
Sout
y Ln
Perr
t
St
Park
e
Dana Av
no data/unsure
Rd
Shedd Pl
Hillside
l
on P
ve
ard A
Healy L
ly Ave
Butterf
B
Ave
C
Ave
t
e
Av
963300
City Parcels
Elmwood Dr
Ave A
s
ng
ro
St
Ave
St
St
ger
Gran
Fo re st St
son
Gib
St
t
ce
Spru
tS
Pos
Brown St
St
1st
963000
Ave
v
son A
Jack
er S
Clov
Census Tracts
Gleason Rd
l
Land Use Map
e
rly Av
Easte
Ave
rem
Eng
Royce S
iP
1-Family
Nels
How
Lafayette St
St
l
Morse P
t
S Main S
n St
hingto
E Was
e
Av
on
ingt
Harr
St
Madison
South St
l Rd
NE Schoo
Ave
Clark St
Deer St
t
East S
Court Sq
ton St
Washing
ck
to
ds
oo
W
l St
Terril
Pl
sfield
Man
r St
E Cente
St
St
n St
erto
Edg
l
Norton P
St
Wales St
Center
Alt
ru
ll
Thra
ve
Bellevue A
Nichols
t
Cottage S
ts Row
Merchan
we
Ho
St
Plain
Ston
Elm St
t
Summer S
Pl
Traverse
n
kli
Aiken Pl
West St
Willow St
Mead ow St
r
e
Ives Av
Ave
Burnham
t
Robbins S
Rd
D
ge
Ri d
ve
Kendall A
St
Williams
ple
Tem
St
963100
ve
Library A
Maple St
School St
Davis
ve
Roberts A
e
Park Av
Ct
Kingsley
an
Fr
ne
Sto
Ave
Kingsley
St
Seabury
River St
d
t
Ave
Clinton
Pine St
ve
nA
bia
Bus
lum
wy 4
Co
US H
d
Ca
mp
be
ll R
Wood Ave
t St
Crescen
t
Baxter S
d Ave
Clevelan
t
Water S
e
int Av
Pierpo
tt Ave
Emme
Hazel St
Evergreen Ave
Watkins Ave
Cra mton Ave
She pard Ln
Cl
em
en
tR
Ri
ple
y
Ave
Melrose
Oak St
State St
Smith St
N Main S
Pearl St
Walnut St
d
en R
Beld
North St
Holly St
Ash St
963200
Laverne Dr
Orchard Dr
Vacant Structure
Dr
e
tus Av
Emeri
Dr
st Rd
dow
Hillcre
Mea
le
t
t
u
T
Exd
h St
y
Nort
Wa
llie
Ca
St
rson
Jeffe
Ct
Park
High St
Wendy Ln
d Rd
rwoo
St
She
olin
Mar
Northeast
US Hwy 7
St
Vernon
ia Ln
Patric
t
Vernon S
ve
Lincoln A
t
Adams S
Grove St
t
Church S
Jan Ave
t
Phillips S
Rd
Field Ave
0
0.2
0.4
0.8 Miles