A municipality’s master plan is intended to set the vision and start the process of crafting the future of the municipality in regard to several elements, housing, history, culture, open space, transportation, finance, etc. Arlington began a very public discussion about these issues and the development of the Master Plan in 2012. In 2015, after thorough community wide discussion, the Master Plan was adopted by Town Meeting. This year, 2019, the focus is on passing Articles that will amend the current zoning bylaws in order to implement the housing vision that was approved in 2015.
Related articles
Why Is This Our Issue & What Should We Do About It?
(presented by Adam Chapdelaine, Town Manager, to Select Board on July 22, 2019)
Overview
Since 1980 the price of housing in Massachusetts has surged well ahead of other fast growing states including California and New York. While the national “House Price Index” is just below 400, four times what an average house might have cost in 1980, a typical house in Massachusetts is now about 720% what it was in 1980. Median household income in the state has only increased about 15% during the same period. No wonder people in Arlington are feeling the stresses of housing costs if they want to live here and are feeling protective of the equity value time has provided them if they bought years ago.
In response to concerns about zoning, affordable housing and housing density, the Town joined the “Mayors’ (and Managers’) Coalition on Housing” to address these growing pressures. This 12 page slide deck presentation outlines the key data points, the number of low and very low income households in Arlington, the rate of condo conversion that is absorbing rental units, etc.
Solutions are offered including:
• Amendments to Inclusionary Zoning Bylaw
• Housing Creation Along Commercial Corridor – Mixed Use & Zoning Along Corridor
• Accessory Dwelling Units – Potential Age & Family Restrictions
• Other Tools Can Be Considered That Are Outside of Zoning But Have An Impact on Housing
Chapdelaine’s suggested next steps are:
• Continued Public Engagement
• Town Manager & Director of DPCD Meet with ARB
• Select Board & ARB Hold Joint Meeting in Early Fall
• ARB Recommends Strategies to Pursue in Late Fall/Early Winter
The Select Board approved the suggested next steps and a joint ARB/ Select Board meeting should be scheduled in the near future.
Note from Reporter: As a community, Arlington has long prided itself on its economic diversity. With condo conversions, tear downs leading to “McMansions”, higher paid workers arriving in response to new jobs, etc., Arlington is at great risk of losing this diversity that has long enriched the community. Retirees looking to downsize and young people who have grown up in Arlington looking for their first apartment are finding it impossible to stay in town. Shop keepers and town employees are challenged to afford the rising housing costs. With a reconsideration of zoning along Arlington’s transit corridors, Arlington NOW has an opportunity to create new village centers, like those recommended in the recent STATE OF HOUSING report. These village centers along our transit corridors could be higher, denser but also offer the compelling visual design and amenities desired by people who want to walk to cafes, shops and public transit.
This timely report on the question of affordable housing vs. density comes from the California Dept. of Housing & Community Development and mirrors the situation in the region surrounding Arlington MA.
Housing production has not kept up with job and household growth. The location and type of new housing does not meet the needs of many new house- holds. As a result, only one in five households can afford a typical home, overcrowding doubled in the 1990’s, and too many households pay more than they can afford for their housing.
Myth #1
High-density housing is affordable housing; affordable
housing is high-density housing.
Fact #1
Not all high density housing is affordable to low-income families.
Myth #2
High-density and affordable housing will cause too much traffic.
Fact #2
People who live in affordable housing own fewer cars and
drive less.
Myth #3
High-density development strains public services and
infrastructure.
Fact #3
Compact development offers greater efficiency in use of
public services and infrastructure.
Myth #4
People who live in high-density and affordable housing
won’t fit into my neighborhood.
Fact #4
People who need affordable housing already live and work
in your community.
Myth #5
Affordable housing reduces property values.
Fact #5
No study in California has ever shown that affordable
housing developments reduce property values.
Myth #6
Residents of affordable housing move too often to be stable
community members.
Fact #6
When rents are guaranteed to remain stable, tenants
move less often.
Myth #7
High-density and affordable housing undermine community
character.
Fact #7
New affordable and high-density housing can always be
designed to fit into existing communities.
Myth #8
High-density and affordable housing increase crime.
Fact #8
The design and use of public spaces has a far more
significant affect on crime than density or income levels.
See an example of a “case study” of two affordable housing developments in Irvine CA, San Marcos at 64 units per acre.
San Paulo at 25 units per acre.
Both are designed to blend with nearby homes.
This is the second in a series of “Arlington 2020” articles. The first article looked at the number of one-, two-, and three-family homes and condominiums in Arlington, and how that housing stock has changed over time. This article will examine changes in the value of those properties. We’re going to look at “value” through the lens of property assessments, so we should start with an explanation of what property assessments are and how they’re used.
A property assessment is simply the Town Assessor’s best estimate of what a property is worth, based on market values. The assessor’s office inspects properties every ten years; during intervening years, assessments are adjusted based on sale prices of similar homes in a given tax neighborhood. For all practical purposes, assessed values tend to trail market values by two years. In my neighborhood, property assessments are spot on — my house was assessed at $501,000 in 2020; during 2018, sales of similar homes in the neighborhood ranged from $495,000 to $520,000.
Condominiums have a single assessed value, which includes land and buildings. Otherwise, assessed values are broken down into land value, building value, and yard items (e.g., a garage or a shed).
Assessed values are used to determine the tax rate. The assessors page on the town website has calculations in worksheet form, but for all practical purposes, it’s just a division problem. One takes the total tax levy and divides by the sum of all property assessments (in thousands of dollars), and that’s the tax rate. An individual’s taxes are the assessed value of their property (in thousands of dollars) multiplied by the tax rate. If an individual owns (say) 1% of the assessed value in town, that individual will pay 1% of the property tax levy.
The main point is that assessed values are based on market values, but with a two-year lag. Consequently, we can use them as a way to see how home prices have changed over time.
With that background information out of the way, we can look at some numbers. Here’s a graph of the median assessed values for condominiums, one-family, two-family, and three-family homes from 2013 through 2020. (the “median” is a value such that half of the assessments are above, and half are below).
| year | Condominium | Single Family | Two-family | Three-family |
| 2013 | $297,800 | $472,850 | $532,650 | $581,600 |
| 2014 | $300,150 | $484,400 | $530,000 | $574,800 |
| 2015 | $318,200 | $507,900 | $572,000 | $616,300 |
| 2016 | $351,050 | $546,300 | $623,150 | $673,550 |
| 2017 | $357,750 | $581,200 | $663,900 | $714,800 |
| 2018 | $395,400 | $618,800 | $732,100 | $787,600 |
| 2019 | $463,250 | $701,550 | $851,200 | $897,500 |
| 2020 | $473,100 | $771,900 | $944,000 | $1,010,850 |
| %change | 58.87% | 63.24% | 77.23% | 73.81% |
As one would expect, two-family homes are worth more than single-family, and three-family are worth more than two. Condominiums have a lot of variety; they could be half of a duplex, or a single unit in an apartment building. But a general upward trend is clearly evident.
These values are straight out of the assessor’s database, and not adjusted for inflation. The Bureau of Labor Statistic’s inflation calculator shows 12% inflation between 2013 and 2020; the %change is pretty considerable, even if one deducts 12% for inflation.
Next, I’d like to dig further into the 1–3 family assessments, by breaking them down into the value of land vs the value of buildings, and showing how that’s changed over time.
Single-family homes:
| year | Land value | Building value | Total assessed value |
| 2013 | $243,700 | $226,300 | $472,850 |
| 2014 | $253,750 | $227,050 | $484,450 |
| 2015 | $272,700 | $229,900 | $507,900 |
| 2016 | $296,400 | $243,950 | $546,400 |
| 2017 | $326,400 | $246,400 | $581,250 |
| 2018 | $360,900 | $248,100 | $618,800 |
| 2019 | $440,400 | $250,400 | $701,600 |
| 2020 | $448,600 | $316,300 | $771,900 |
| %change | 84.08% | 39.77% | 63.24% |
Two-family homes:
| year | Land value | Building value | Total assessed value |
| 2013 | $202,500 | $320,550 | $532,650 |
| 2014 | $212,250 | $307,800 | $530,000 |
| 2015 | $256,400 | $309,800 | $572,000 |
| 2016 | $262,500 | $349,400 | $623,150 |
| 2017 | $307,000 | $350,700 | $663,900 |
| 2018 | $352,500 | $373,900 | $732,100 |
| 2019 | $478,300 | $374,850 | $851,700 |
| 2020 | $454,500 | $486,100 | $944,000 |
| %change | 124.44% | 51.65% | 77.23% |
Three-family homes:
| year | Land value | Building value | Total assessed value |
| 2013 | $200,100 | $377,900 | $581,600 |
| 2014 | $209,100 | $364,100 | $574,800 |
| 2015 | $249,800 | $366,550 | $616,300 |
| 2016 | $259,950 | $412,350 | $673,550 |
| 2017 | $298,100 | $412,500 | $714,800 |
| 2018 | $343,050 | $438,800 | $787,600 |
| 2019 | $459,000 | $440,100 | $897,500 |
| 2020 | $440,100 | $578,450 | $1,010,850 |
| %change | 119.94% | 53.07% | 73.81% |
There are several things worth pointing out in these breakdowns.
First, note that the land and building values “jump” a bit between 2019–2020. 2020 was one of our full reassessment years, so I’m willing to attribute this to a periodic course correction. The total increase is generally linear, but the land/building composition has changed.
Second, the median land value for single-family homes is higher than the median building value, for all years between 2013–2020.
Third, most of the increases come from changes in land value. I believe this comes down to location, location, and location. Arlington has a well-respected public school system, and it’s close to universities and tech centers is Cambridge and Boston, and office parks in Lexington, Waltham, and Burlington. City amenities are close at hand.
So what does one do about our rising home prices, and in particular, the rising value of land? The first (and perhaps default) answer is to do nothing. Rising property values are a boon to homeowners who purchased a capital asset (i.e., a house) in the past, and have seen its value appreciate over time. The downside of doing nothing is that each year, increasing housing prices create an ever-increasing income threshold for new residents.
An alternative approach would be to allow more (and smaller) units to be built on each lot. This requires reconstruction or redevelopment, but it allows the cost of land to be amortized among several households. More units/lot means more people and more density, but it reduces the income threshold for buying in to Arlington. (Note that the per-unit cost for three-family homes is lower than the per-unit cost for two-family homes. Similarly, the per-unit cost for two-family homes is lower than the cost of a single-family home).
A third article will look at the distribution of housing prices in Arlington, and how the distribution varies by housing type.
Here is a spreadsheet of data shown in this post.