A family earning less than $100,000 a year can't afford to buy a house in Glocester, Foster, Scituate and Smithfield. In Burrillville, Johnston and North Providence, houses are a little more affordable, but still out of reach for many families.
That's the finding of a study by HousingWorksRI, a Providence-based coalition of nonprofit groups, business groups and philanthropic organizations. The coalition analyzed fourth-quarter home sales released by the Rhode Island Association of Realtors last month.
Foster and Glocester have the highest median house prices in the Northwest. A median-price house in those towns costs $385,000 and $365,000, respectively.
Assuming that 30 percent of income goes to mortgage payments, a family would have to earn $124,200 a year to buy a house in Foster and $117,720 to buy one in Glocester, according to the study.
The median prices of houses in Johnston and North Providence are $267,250 and $264,950, respectively. A Johnston family would need $86,200 a year and a North Providence family $85,480 to be able to devote 30 percent of income to mortgage payments, the study found.
Real estate analysts have said for months that the housing market is cooling off. However, the HousingWorks RI study shows that in the Nortwest area, the gap between household incomes and house prices continues to widen, Ari Matusiak, HousingWorks RI acting director, said.
The study "tells a pretty compelling story. Even though [home] price increases are not as stark on a quarter-to-quarter basis, compared to 2002-2004, we are seeing increasingly unaffordable homes," Matusiak said. "There is a huge discrepancy between market price and what Rhode Island households are earning."
The Northwest provides a snapshot of a greater trend affecting the state, Matusiak said. "It's not like the Northwest is unique," he said.
Chris Barnett, spokesman for Rhode Island Housing, a state agency that provides financing for low- and moderate-income families, agreed: "We are absolutely seeing the affordability gap growing too wide for most people to bridge."
Statewide, the median house price has grown 11 times faster than the state's median income, Barnett said. Additionally, applications for new residential constructions in the state are at a 20-year low, he said. That means the state's housing stock is falling far short of the needs of a growing population.
"Supply is certainly not enough to meet demand," he said.
One of the reasons for the high housing prices in the Northwest is its proximity to Massachusetts. Many local residents work in Boston, said Glocester Town Planner Ray Goff.
These commuters often receive higher incomes than residents who work in the state, and, in effect, "out-compete buyers in price," he said.
Even though Burrillville, Johnston, and North Providence are more affordable than other parts of the Northwest, it is still no cause for celebration, Matusiak said.
With the median state income at $46,000, a house priced over $300,000 is "still hardly affordable," he said.
Even in Burrillville, the town with the lowest median price -- $272,450 -- a family would need to earn $87,880, which is more than double the state median income.
The high prices of houses should not be a deterrent to lower-income households, according to Bob Martin, owner of Century 21 Crossroads in Woonsocket.
"Persons earning less than $100,000 can't buy every house in [Northwest communities], and they might have to look a little more" for a good deal, he said. But "more creative mortgage payments can make monthly payments more affordable to people," he said.
But he conceded that "very few people have seen the income growth to the same rate as housing prices have increased." At the end of the day, he said, "people are more interested in their monthly payment than the ticket price."
pmarceloxxxprojo.com, 277-7493
ARTICLE TOOLS: 
