Rhode Island news

R.I. trails the rest of the country in housing construction

Rhode Island's production total was barely half that of the next-lowest state, Alaska.

01:00 AM EDT on Monday, September 18, 2006

BY RANDAL EDGAR
Journal Staff Writer

Rhode Island has been creating new living space at a slower rate than any other state in the country, new figures from the U.S. Census Bureau show.

The state added 1,505 housing units between July 2004 and July 2005, an increase of only 0.3 percent in the total number of housing units, placing Rhode Island last among the 50 states in both number and in rate of increase.

Rhode Island's production total was barely half that of the next-lowest state, Alaska, which added 2,718 housing units. The next-lowest percentage increase -- 0.4 -- was in New York, which added 33,666 housing units.

The numbers reflect a long-term trend in which low production, shrinking household sizes and demand from outside the state have fueled rising prices, according to local housing advocates.

"The rest of the country and New England have enjoyed five years or so of historically low interest rates and commensurately high housing demand," Roger Warren, executive director of the Rhode Island Builders Association, said recently. "From that standpoint, what you would expect to see would be rising production numbers, but instead what we saw were declining numbers. We haven't kept up with demand and you saw housing prices increase because of that."

Warren and Christopher Barnett, spokesman for Rhode Island Housing, blame the low production on resistance from local communities, which worry that new housing units will put more students in their schools and add to education costs.

"Most communities are wary of new housing, and that has constricted supply to the choking point," Barnett said.

While the census numbers are based on data from more than a year ago, recent data show the downward trend continuing. For example, a builders association report released last month concluded that single-family house construction in Rhode Island was down 8.7 percent for the first six months of this year.

The census numbers go beyond single-family houses, counting housing units derived from single and multifamily houses, condominiums, apartments, mobile homes and groups of rooms and single rooms that are occupied as separate living quarters. The figures are based on building permit data and records of new mobile home shipments to each state, said Greg Harper, a Census Bureau demographer.

(Housing units that have been added without a building permit, such as a room that a homeowner decides to rent, are not counted and will not be added to the state totals until the 2010 census, he said.)

Housing advocates said they hope that the downward trend in Rhode Island will change now that 29 communities have state-approved plans to create more subsidized, income-restricted affordable housing. The state also has an affordable-housing plan, which calls for the creation of nearly 5,000 affordable-housing units over a five-year period.

The General Assembly, responding to the plan, authorized a $50-million bond referendum that would help create the first 1,000 of those affordable units if passed by voters on Nov. 7.

Housingworks RI, a coalition of more than 100 businesses, faith-based groups and charitable organizations, will kick off a campaign to urge passage of the bond today in the back yard of a new affordable home on Douglas Avenue in Providence. Governor Carcieri; Lt. Gov. Charles Fogarty; Bishop Thomas J. Tobin, of the Roman Catholic Diocese of Providence, and Providence Mayor David N. Cicilline are among those expected to attend.

Housing is considered affordable when a household spends no more than 30 percent of its gross income on the rent or mortgage, taxes and insurance. To be affordable in Rhode Island, a housing unit must sell or rent at a below-market price, made possible with a government subsidy.

The national census data contained few surprises in terms of which states are producing the most housing. As expected, Southern and Western states such as Nevada, Arizona and Florida had the highest building rates. Nevada added 42,998 housing units during the 12-month period, for a 4.4-percent increase -- highest in the country.

Only the District of Columbia, with less than a tenth the land area of Rhode Island, added fewer units than Rhode Island -- 1,175.

Other census data shows that Rhode Island's population actually declined by 3,727, or 0.3 percent, from July 2004 to July 2005 -- the period in which the state had the lowest rate of housing growth -- but the state's population has grown by 2.7 percent, from 1,048,319 to 1,076,189, since 2000. The state's housing stock grew 1.8 percent during that period, from 439,837 to 447,810, according to census figures.

redgar@projo.com / (401) 277-7418

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