AMI Explained

by Steve Revilak

The term “AMI” or “Area Median Income” comes up in almost any discussion about affordable housing, because it’s used to set rents and the household incomes for people who are eligible to live in affordable dwellings. AMI is a fairly technocratic concept and my goal is to make the concept (and the numbers) easier to understand.

AMIs are set each year by the U.S. Department of Housing and Urban Development; broadly speaking, an AMI is the median income of a region. Arlington is part of the “Boston-Cambridge-Quincy, MA-NH HUD Metro FMR Area” which consists of more than 100 cities and towns in Massachusetts and New Hampshire. Median incomes represent the “middle” family income of an area—half of households make more, and half make less.

In the process of turning median incomes into income limits, HUD also considers household size: larger households are assigned larger AMI limits than smaller ones, in order to reflect the higher cost of living for more family members.

How do these limits translate into affordable housing regulations? Arlington’s affordable housing requirements (aka “inclusionary zoning”) require that rents for affordable units be priced for the 60% area median income, but the dwellings are available to households making up to 70%. Let’s show an example with some numbers.

Household size	60% Income Limit	70% Income Limit	60% Rent
1	$68,520	$79,940	$1,717/month
2	$78,360	$91,420	$1,959/month
3	$88,140	$102,830	$2,203/month

HUD considers an apartment suitable for a household if it has one bedroom less than the number of household members, so a two-bedroom apartment would be suitable for a household of three, a one-bedroom would be suitable for a household of two, and a studio would be suitable for a household of one. The monthly rent for a two-bedroom apartment would be calculated as follows: $88,140 ÷ 12 × 30% = $2,203. The 30% comes from HUD’s rule that affordable housing tenants should not be cost-burdened, meaning that they pay no more than 30% of their income in rent.$88k or $102k/year can seem like a lot of money (and once upon a time it was). To get a better sense of what these income levels mean, I looked into what kinds of jobs pay these wages. To that end, I found wage information from the Arlington Public Schools report to Town Meeting, the Arlington town budget, and wage data from the Bureau of Labor Statistics. Here are a few scenarios:

Scenario 1: single adult

Scenario 1 represents a single adult living alone, and earning between $68,520 and $79,940. Jobs in this pay range include:

Elementary classroom teacher ($62,000 – $75,000)
Town planner ($75,000 – 79,000)
Animal Control Officer ($72,000)
Firefighter ($73,640)
Librarian ($70,395)
Lab Technician ($70,710)
Social Worker ($71,470)
Subway operator ($72,270)
Licensed Practical Nurse ($75,690)
Paralegal ($77,500)
Chef ($78,040)
Carpenter ($78,000)

Scenario 2: single parent with household of two

Scenario 2 represents a single parent earning between $78,360 and $91,420/year. Jobs in this pay range include:

Office Manager – Assessor’s office ($80,399)
Assistant Town Clerk ($77,375)
Town Engineer ($74,000 – $80,000)
Police Department Patrol Officer ($87,000)
Town Budget Director ($88,488)
Telecommunications equipment installer ($80,350)
Plasterer and Stucco Mason ($82,250)
Electrician ($82,380)
Cement Mason ($86,250)
Plumber and pipe fitter ($90,580)

Scenario 3: household of two, both adults

Scenario 3 has two adults, each earning $39,180 – $45,710 per year. Jobs in this salary range include several that we’ve come to know as “essential workers” during the pandemic.

Special education teaching assistant ($34,290)
Arlington Public Schools Paraprofessional ($36,290 – 42,440)
Substitute Teacher ($34,921)
Inspectional Services Record Keeper ($44,481)
Food preparation worker ($39,590)
Bartender ($39,730)
Childcare worker ($40,470)
Ambulance Driver ($40,890)
Waiter ($41,440)
Pharmacy aide ($41,460)
Bank teller ($42,270)
Tailor and dressmaker ($43,790)
Restaurant cook ($44,140)

You may have noticed gaps in these lists — for example, there are no jobs listed in the $50,000 – $60,000 range because it’s in between the income limits for one- and two-income households. It’s also worth noting that a fair number of town employees’ salaries would qualify them for affordable housing (the town is Arlington’s largest employer).

So who qualifies to live in affordable housing? People with a lot of ordinary, working-class jobs, including many town employees.

Photo of flyer that says Rent is Too High, Don't Let City Hall Block Rent Control

Rent Control and the Supply of Affordable Housing

by Arthur Prokosch

New research from the Urban Institute shows that rent control and rent stabilization policies in 27 metro areas increased the supply of rental units with prices affordable to extremely low-income residents. However, this came at the cost of less overall housing supply, and especially fewer rentals with prices affordable to higher-income residents. If subsidization proposals return to Boston and Massachusetts again next year, they will not be a silver bullet for affordability, but could be one ingredient in a successful strategy alongside more housing construction.

As detailed in an in-depth Boston Globe article, rent control in Massachusetts was last repealed statewide, 51-49%, by an initiative petition in 1994. A year ago, as the Globe also reported, Boston and Massachusetts saw a number of “rent stabilization” proposals to reinstitute some components of rent-control policies. None of these proposals included income-specific provisions like limits on higher-income tenants occupying rent-stabilized apartments. Discussions are likely to restart next year.

The new research gives stronger evidence that achieving the goal of affordable housing at all income levels requires multiple complementary strategies, because each affordable housing strategy has its own tradeoffs. Rent control may increase the number of very-low-priced rentals across an entire region, at least in the short run, with the tradeoff of reducing housing supply and affordability at higher income levels. Thus, at best, rent control would need to be paired with greater amounts of new housing production–even more than is already needed today–to be able to give a net benefit for low-income, moderate-income, and every other income band above very-low-income residents.

Other affordable-housing strategies have their own tradeoffs. Arlington’s inclusionary zoning requirements set aside some units for lower- and moderate-income residents, with a tradeoff of increasing the prices of the remaining units, or reducing their number. Meanwhile, nonprofit organizations like the Housing Corporation of Arlington and government agencies like the Arlington Housing Authority ensure that some lower-income residents can afford housing, with the tradeoff that their limited funding only allows them to serve a small fraction of the demand.

In contrast, reducing barriers to the construction of new housing decreases housing costs across a metro area. See another recent article for a description of how housing construction has a “filter effect”, slowing rent growth at all income levels. Even so, a range of strategies would help ensure that affordable housing arrives as quickly as it is needed, at every income level, and in every neighborhood where it is needed.

In summary, rent control can be a useful tool, one that’s most effective when combined with other strategies. Our housing problems are multi-faceted, and the responses have to be multi-faceted too.

Affordable housing rent control

Written by Guest Writer October 3, 2024

Race-based Inequality of Economic Opportunity

Written by Barbara Thornton November 11, 2020

Transportation Emissions and MBTA Communities in Arlington

by Anson Stewart

Last year, the New York Times published The Climate Impact of Your Neighborhood, Mapped. This interactive feature shows that across the country, carbon emissions per household tend to be lower in relatively dense, walkable, and transit accessible areas. Compared to nearby communities like Winchester, Lexington, and Belmont, the average household in Arlington is responsible for much lower carbon dioxide-equivalent (CO₂e) emissions. Allowing more housing along Mass Ave and Broadway, as proposed by the town’s MBTA Communities Working Group, would enable more households to live in these lower-emissions neighborhoods and could be a meaningful step toward reducing driving and Massachusetts’ climate impact.

Zoning Artificially Limits Housing Supply

As noted in the NYT feature above, “For many people today, it is often easier and cheaper to find a home in a high-emissions community than a lower-emissions one… Many cities and local governments often artificially limit the amount of denser or transit-friendly housing available, particularly in wealthier neighborhoods, through zoning that favors single-family homes or requirements around minimum lot sizes and parking spaces.” Zoning restrictions from the 1970s severely constrain housing capacity along the corridors that help reduce climate impacts in Arlington. Those restrictions push families out to places where people drive more to meet their daily needs.

Driving (VMT) is the Largest Source of Massachusetts’ Climate Emissions

Cars are mind-bogglingly detrimental to our climate. According to the Massachusetts Clean Energy and Climate Plan for 2025 and 2030, “Transportation is the largest source of GHG emissions in the Commonwealth, responsible for 42% of statewide GHG emissions as of 2019… Emissions in the transportation sector have stagnated despite state and federal vehicle emissions standards that have gradually increased the fuel efficiency of vehicles. One major cause of increased emissions is the considerable increase in total statewide vehicle miles travelled (VMT) over the past 30 years.” Even as electric vehicles proliferate, the carbon intensity of our grid means driving will have a substantial climate impact, and reducing VMT must be a primary strategy.

The NYT analysis uses nationally available survey and expenditure data, so income and other effects may confound the estimates of transportation emissions. Massachusetts has a unique dataset that allows measuring driving emissions much more directly – the Massachusetts Vehicle Census (mentioned in the town Working Group report).

For each municipality, dividing the daily mileage driven (of cars registered there) by the population yields vehicle miles traveled (VMT) per capita, which varies widely in the Boston region. For example:

Cambridge: 8 miles per person per day
Somerville: 11
Arlington: 14
Boston: 14
Belmont: 14
Medford: 15
Lexington: 16
Winchester: 17
Waltham: 17
Woburn: 24

Thanks to Arlington’s walkable neighborhoods and transit access, our per capita VMT is lower than many nearby communities, and even on par with the City of Boston!

If Not Arlington, Then Where?

As a thought experiment, consider a climate-conscious family of four who wants to buy a condo in one of the communities above. If they can’t afford Cambridge, Somerville, or Arlington (where 2023 YTD median condo sale prices were $910k, $855k, and $810k respectively), they might consider Waltham or Woburn ($615k and $638k, respectively), or even Winchester or Lexington ($795k and $798k).

Lexington in particular might be appealing, especially as their Town Meeting recently adopted MBTA Communities zoning that allows much more multifamily housing than the minimum required (see the Lexington Cluster Housing Study Group materials in support of meaningful new housing supply). But even with that new capacity, the pace of development will be slow and most of the transportation “bones” of Lexington will be fixed. It is generally less transit accessible than Arlington, and all else equal, the family would likely end up driving more than if they lived in Arlington.

Assuming the average VMT per capita figures above, a family of four would end up driving an additional 2,920 miles per year living in Lexington versus Arlington. Assuming 30 mpg fuel efficiency and 8.9 kg CO₂e per gallon of gas, the incremental emissions from this one family would be 865 kg of CO₂e, equivalent to the annual carbon sequestered by six half-century-old red oak trees (according to Forest Service data here).

If this family moved to Woburn instead of Arlington, the incremental annual driving would be 14,600 miles. Associated emissions would be over 4.3 metric tons, equivalent to the annual carbon sequestered by 32 of those red oak trees.

Extrapolating These Emissions

How does this example of one family relate to the level of development Arlington might see from MBTA Communities zoning updates? The Working Group’s proposal had a nominal capacity of just over 7,000 housing units in an area that currently has about 2,100. The ARB recommendation to Town Meeting cuts the nominal capacity to around 3,400, for a possible net change of around 1,300 units theoretically allowed. Recent estimates (following the approach here) suggest that this capacity might result in 100 to 300 new housing units built in Arlington by 2033.

If new units enable 250 families like the one above to live in Arlington instead of Woburn, these back-of-the-envelope calculations suggest the avoided annual emissions from VMT reduction would be over 1,000 metric tons CO₂e in the year 2033.

Of course these are rough estimates, and the actual climate impact will depend on wider development trends, grid decarbonization, MBTA service, and the details of the zoning that Town Meeting adopts later this month. Low parking requirements (as originally proposed by the Working Group) and robust transportation demand management could help strengthen the climate change mitigation potential of Arlington’s MBTA Communities zoning update. On the other hand, further reductions in Arlington’s multifamily housing capacity would exacerbate emissions. Those concerned about reducing our collective climate impact should take note.

Emisssions MBTA Communities

Written by Guest Writer October 7, 2023

The Artemis Arlington. An old brick factory building attaches to a new modern building with beautiful landscaping in front.

Housing

Overwhelming Demand for Arlington’s New Affordable Housing Units

Written by Guest Writer June 14, 2024

HCA’s New Vision for 10 Sunnyside Ave

(Contributed by HCA Board Member Laura Wiener, and Executive Director Erica Schwarz)

The Housing Corporation of Arlington (HCA), the Town’s non-profit housing developer, is excited to create a new development on Sunnyside Ave with 43 new affordable homes. The homes will be a diverse mix of sizes and serve people of different incomes, all under 60% of the area median income. Arlington and the entire Greater Boston region have a severe shortage of affordable housing, which this project will help to address. Arlington’s Master Plan, Housing Plan, and Housing Trust Action Plan all acknowledge the need to create significantly more affordable housing.

The HCA’s new Sunnyside Ave proposal is located just off Broadway, near the Alewife Brook DCR Greenway and the Somerville line; it’s a great location near a supermarket, bus lines, and a modest walk to Davis Square. Currently, the site is a dilapidated former auto body shop. The proposal is designed to meet the specific needs of HCA’s residents and the Arlington community. The development will be Passive House certified. It includes 21 vehicle parking spaces, approximately 70 bike parking spaces, and a 2nd floor roof garden for tenants to enjoy. The development also includes a community room that the HCA will share with other local groups. The project will also add a sidewalk on Sunnyside Ave where there currently isn’t one. HCA owns the site and expects to start seeking zoning approval in the spring.

Building affordable housing is a long and complicated process, due to the permitting process plus the number and complexity of funding sources needed. The state’s Department of Housing and Community Development receives many more requests than they can fund in every funding round. We expect to complete the permitting process in 2023, secure our financing by the end of 2024, and start construction in early 2025. With an expected construction timeline of around one year, HCA expects to see tenants moving into the building in spring, 2026. A public forum on the project is anticipated in the coming months. Given the complicated funding and permitting challenges, your monetary and public support of our new development on Sunnyside Ave would be appreciated.

The Housing Corporation of Arlington is a non-profit, community-based developer and owner of affordable housing in Arlington. It owns 150 units of affordable rental housing in all parts of town. The units are occupied by a diverse mix of families and individuals. HCA has been purchasing, rehabilitating, and building new housing since 2000, and also provides social service programs to support family stability and build community connection and engagement. Every week, HCA staff help local families who are struggling with the extreme cost of housing, making the creation of more affordable homes both urgent and important.

The staff, board of directors, and the more than 1,000 tenants, donors, and members who make up the HCA organization are very excited about this opportunity to expand Arlington’s portfolio of affordable housing. Our most recent projects included three newly constructed buildings—two in Downing Square (Lowell Street) and a mixed-use property shared with “Arlington Eats” on Broadway. To learn more about HCA or apply for housing, go to: https://www.housingcorparlington.org.

Housing Corporation of Arlington

Written by Laura Wiener February 22, 2023

Arlington 2020: the Cost of Low-Density Housing

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).

Graph of Median assesed values by year and housing type

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.

assessors data housing affordability

Written by Steve Revilak October 4, 2020

Arlington Report on Demolitions & Replacement Homes

Written by Guest Writer July 27, 2019

Housing

Will Arlington Set A Housing Goal?

After a week of good coverage on the need for more housing units in the greater Boston region, on August 2, 2019 the GLOBE carried the following editorial, mentioning the situation in Arlington.

Good news? On housing? In Massachusetts?

Yes, that’s right. Even here in the land of the $600,000 starter home, a few forward-thinking cities and towns are starting to make progress on what sometimes seems like an intractable problem: the inadequate production of new housing that has sent the cost of renting or buying in Greater Boston into the stratosphere.

It’s way too soon to declare victory — not when the median sale price for a house in Massachusetts is $429,000 and $420,000 for a condo, according to the Warren Group. High prices happen when demand gallops past supply, causing buyers to bid up prices of existing homes to insane levels. In addition to squeezing renters and contributing to gentrification, the skyrocketing price of housing has evolved into a real threat to the region’s economic competitiveness.

“Greater Boston is losing current and potential domestic residents,” warned the Boston Foundation in its annual housing scorecard, “who are voting with their feet to live elsewhere for a variety of reasons.” Just on Tuesday, another report — this one from the real estate website Apartment List — found that only San Francisco has done a worse job than Greater Boston building new housing to respond to demand.

Thankfully, last year 15 cities and towns in Greater Boston made a joint pledge to pick up the pace of new housing construction by permitting 185,000 new housing units by 2030. Collectively, meeting that goal would mean tripling the pace of housing production. Some of the members of the group, called the Metropolitan Mayors Coalition, are doing their part to reach that goal faster than others — but almost all 15 report progress.

Even outside those three, there’s some impressive municipal-level progress. The Revere City Council approved development on the portion of the former Suffolk Downs racetrack that sits in that city, which will eventually bring in a whopping 2,700 housing units

Leading the way have been Boston, Cambridge, and Somerville, each of which has set numerical goals for housing production. Boston has been on a building spree and is on track to meet its goal of 69,000 new units by 2030. Cambridge volunteered 12,500 new housing units; and Somerville has said it will build 6,000. Committing to a specific goal is crucial: A hard number creates accountability for officials.

In Quincy, 1,500 housing units are under construction, and another 1,030 are either permitted or in the process of receiving permits. Medford has 497 housing units in construction. More than a thousand units are expected in Brookline over the next few years, in part thanks to the state’s 40B housing statute that lets developers bypass local zoning when towns have insufficient levels of affordable housing. Newton has 471 units under construction and another 273 permitted.

Other municipalities are working on plans or reforming zoning bylaws to set the stage for future growth. Austin Faison, Winthrop’s town manager, says that will involve setting a housing production goal. Everett rezoned land near the newly extended Silver Line, setting the stage for development. Braintree is in the process of updating its zoning bylaws that would include provisions for denser multi-family housing.

Arlington experienced a setback when its town meeting rejected an innovative plan to spur denser housing and allow so-called accessory dwelling units. Town manager Adam Chapdelaine said the town was now launching a “more cooperative effort” and would try again, and that the discussion would include coming up with a numerical goal.

The experience in Arlington points to one way the state can help municipalities. Town meetings and city councils require a two-thirds vote to change zoning, which can empower a small minority to thwart reforms needed to encourage housing. Governor Charlie Baker’s housing bill would change that by reducing to one-half the vote needed to change zoning — and deserves legislative approval pronto.

There’s one other way that the state can help, and this one won’t come as a surprise: better transportation. Access to transit can be a key to successful development. For instance, Revere wants a commuter rail stop at Wonderland. Without direct access to any rail service, Everett is banking on buses as part of its development plans.

Cities and towns that are moving forward on housing production inevitably encounter resistance, and they deserve great credit — not just for taking badly needed steps to build housing, but for doing so in a coordinated way. Keeping municipalities on the same page is part of what’s necessary to break down the longstanding barriers to housing in Massachusetts. As Chelsea city manager Thomas G. Ambrosino put it: “Having it be a region-wide effort and everyone rowing toward the same goal makes it easier for us to defend our efforts, because we can tell those who are critical about building that this is a regional need and everyone is in it together.”

Arlington Housing Boston Globe Editorial Housing production goal for new housing

Written by Guest Writer August 2, 2019