Housing Prices

[Jenkins]

Reading through some comments on the ProJo interactive board, I saw that some people just can't imagine who it is that will be buying all of these fancy new downcity condo's and apartments. Here's a link to an MSNBC article on how the retiring baby boomers are now moving to cities in big numbers. Can certainly see that possibly happening with Providence. One problem Providence could have though, is that it seems to me retirees are VERY aware of cost of living and taxes, no matter what their wealth is, and right now Rhode Island is one of the worst places for both

http://www.msnbc.msn.com/id/7190609/

[Cotuit]

I wonder if someone can break down these prices for me. $500k - $3million sounds like a lot, but what is the actual average mortgage payment on a property like this. I assume it's still a lot, but would sound more reasonable if it was broken down.

People also seem to have such little faith in how wealthy Rhode Island actually is. We will have outsiders filling these spots, but there will be Rhode Islanders living in them too.

[Jenkins]

I wonder if someone can break down these prices for me. $500k - $3million sounds like a lot, but what is the actual average mortgage payment on a property like this. I assume it's still a lot, but would sound more reasonable if it was broken down.

People also seem to have such little faith in how wealthy Rhode Island actually is. We will have outsiders filling these spots, but there will be Rhode Islanders living in them too.

<{POST_SNAPBACK}>

Well, it all depends on the interest rate at the time, etc., but roughly speaking, a half million dollar mortgage at 6% interest is about 3k a month, before taxes. I think with the retireeng boomers, though, that they will have a large amount to invest, assuming they have just sold their home for a large amount of money (especially true if they are coming from Massachusetts). So, you could have 4 bedroom house selling in a suburb of Boston for close to a half mil. Then take that money and buy a condo in Providence and only have to pay taxes. Very high taxes, though.

[Soren]

So, you could have 4 bedroom house selling in a suburb of Boston for close to a half mil.

<{POST_SNAPBACK}>

I think you're underestimating a bit. Homes in the pricier 'burbs regularly sell for well over a million.

[Frankie811]

I think you're underestimating a bit.  Homes in the pricier 'burbs regularly sell for well over a million.

<{POST_SNAPBACK}>

We always sell ourselfs short when considering projects like these. We think, who can afford this, and who's gonna be able to afford that. If there wasen't a market for these projects, then they wouldn't be built. Who in there right mind would spend millions just to have their project fail. Many studies have been done on the housing market in this area. Former Mayor Cianci once said that we need to think big, and that he was surprised himself when he learned that we have one of the highest area economies in the world. Just think of all the business and corporate leaders, doctors, bankers, lawyers and wealthy indivisuals in the region. Everybody thought that Providence Place wouldn't do well, but we all know better, don't we. There's plenty of old money in this state.

[Jenkins]

The other thing to think about with the growth of Providence is the law of momentum. In almost any area, whether it is a city, a relationship, a sports team, things are either getting better, or they are getting worse. Often the sheer momentum of whichever direction things are going reinforces itself, creating kind of a self-fulfilling prophecy. That being said, the momentum for Providence right now is very positive. That in and of itself is one of the hardest things to do, to get the momentum going in the right direction. But now that it is, it actually makes it more likely that things will succeed in the long run.... OK, did any of that make any sense

[Cotuit]

OK, did any of that make any sense 

<{POST_SNAPBACK}>

Perfect sense actually.

The locals here, as locals everywhere often are, can be a quite pessimistic lot. Often when I tell a native that I've lived in Boston and New York and chose to move here, they look at me like I have 9 heads and can't imagine why I would chose to live here. They'll say they want to leave (but notice they never do). Though when I talk to others from away they can't shut up about how much they love it here (even with the high taxes and government corruption, schools are usually the biggest gripe).

I can almost imagine the population of the state slowly cycling out the natives and being full of people from away. These people from away with their positive outlooks on the state are undoubtedly a good thing (and they aren't only coming from Boston). These people will open businesses, they will run for office (hopefully changing the inbred culture of corruption), they will raise families and create new generations of people who only know Rhode Island as a great place to live that has a colourful history.

[Jenkins]

I read recently that the population of RI actually increased over the last years. And almost in direct proportion to Massachusetts' decrease. So I think a lot of people are moving in from MA. Me and my wife moved to Providence from Boston, and mostly based on the good things I'd heard about Providence from various sources. As things continue to get better, hopefully more people will make the move. It has worked out so far for us. And I've told all my MA co-workers and friends how much we like Providence.

[Cotuit]

I read recently that the population of RI actually increased over the last years. And almost in direct proportion to Massachusetts' decrease.

<{POST_SNAPBACK}>

I think that's a bit of a coincidence. Metro Boston is still growing, but the population in Western Mass. is dropping really fast, bringing the state's numbers down with it. There are probably people moving from Greater Boston to Providence and NH, and people from Western Mass. moving to Providence and NH and also filling the void in Greater Boston. Then Greater Boston, Providence, and NH continue to also have people moving in from other parts of the country.

People are definately coming here from Mass., but the correlation of the numbers lost in Mass. to the numbers gained in RI are a coincidence.

[Magellan98]

This may sound funny - but in 1995 when I was applying to college my "winning" essay (I say "winning" because I got into my eventual alma mater with it) was all about the pessimism in Rhode Island. If I can find it maybe I'll post it. Anyway, at the time the Providence Place Mall was a hot topic, the Convention Center had just been built and wasn't living up to expectations, and all I can remember reading in the Projo were downbeat editorials on Providence and its economic atmosphere.

Fast forward 10 years and I can't believe all of the projects being proposed. Though 75% will probably never see the light of day, I think it's exciting to see the type of residential developments being proposed - the type that just may lure me back to Providence. I think Providence is a great place for many reasons which I think have been exhausted on this website. However, I've never seriously entertained the idea of returning because Providence just didn't have the urban experience I want. I don't want to live in a 4 bedroom house on an acre in Lincoln. I don't want to mow lawns and commute 20 minutes to work. I want to live downtown, where I can walk to cafes, book shops, and restaurants. I want one (or no) cars to be enough for my partner and I. Based on what I've seen on this site, I'm not alone. Maybe I'm crazy, but I'm a firm believer in the "If you build it they will come" mantra when it comes to Providence. Its been the case with the mall, recent hotels (Westin, Courtyard), and even the airport (massive growth following the opening of the new terminal). My fear now is that it'll take years before any of these residential projects ever break ground. I want to come back as soon as possible!

[Cotuit]

This may sound funny - but in 1995 when I was applying to college my "winning" essay (I say "winning" because I got into my eventual alma mater with it) was all about the pessimism in Rhode Island.  If I can find it maybe I'll post it.

<{POST_SNAPBACK}>

I'd love to read it.

Though 75% will probably never see the light of day, I think it's exciting to see the type of residential developments being proposed

<{POST_SNAPBACK}>

Sounds like a Rhode Island pessimist to me, I think most of these have a shot at coming to pass in some form. Maybe I'm too optimistic. The Power Block is the part I'm not quite holding my breath on.

I want to live downtown, where I can walk to cafes, book shops, and restaurants. I want one (or no) cars to be enough for my partner and I.  Based on what I've seen on this site, I'm not alone.

<{POST_SNAPBACK}>

I don't own a car. I live in Providence car-free. It can be a hassle, and it's not for everyone, but everything I need from home, to shopping to work, to entertainment is within a 15 minute or less walk.

Maybe I'm crazy, but I'm a firm believer in the "If you build it they will come" mantra when it comes to Providence.

<{POST_SNAPBACK}>

If Providence was the same as it was in 1985 today, I never would have came here. They built it, and I came.

Where do you live now?

[Frankie811]

I want to come back as soon as possible!

Time to come home, Maggelan!

[Cotuit]

Boston.com has an entire special section on the existing and planned luxury condos in Boston. It can give you an idea of the demand there, and I think it shows that there are plenty of people to fill these spaces both in Boston, and here in Providence.

[miriam]

Hi,

First off, I'm new to this board. Just stumbled on it today. I recently moved to Fox Point after being priced out of my illegal loft in olneyville. So I've been wondering a lot about who's going to fill in all these luxury lofts.

Here's what I don't get. In my circle of friends, most of whom are either artists, service industry workers, or work in the non-profit sector, I can count on one hand the number of people who make more than 20K a year. Senior staff at AS220 don't make that much a year, yet AS220 is referenced as a major selling point by urban redevelopers looking to sell Providence's hip and artsy image. When I first moved to Providence, I enjoyed a high standard of living at about 10K a year and that was only six years ago.

Now with all this "revitalization" affordable housing for me and my peers is becoming more and more scarce. Buying is nearly impossible, especially when rising rent precludes most from saving for a down payment. It seems like every year or so an out of state investor buys the building I'm renting in and doubles the rent, sending me scurrying to find a new place to live. The building that I'm living in now -- a shabby two-unit -- is on the market for almost 600K.

I heard on NPR the other day that homelessness in RI is at an all-time high. I think that's pretty shameful considering how much new housing is currently under construction.

So maybe the negative stuff we're hearing about all this new development isn't so much pessimism as it is resentment. I'm tired of hearing that a "Rising Sun" raises all boats. All that seems to be going up is the rent. I honestly don't see how all this development is going to help the average Rhode Islander.

m.

[provid]

We'll more than anything its meant to draw new people into the city from away; Boston for example. These are the places where prices are twice as high so a 500k condo means much less.

The train is close to everywhere so the morning train ride is cake compared to driving into the city.

[miriam]

We'll more than anything its meant to draw new people into the city from away; Boston for example.  These are the places where prices are twice as high so a 500k condo means much less.

The train is close to everywhere so the morning train ride is cake compared to driving into the city.

<{POST_SNAPBACK}>

Obviously this is the case. But how do Providence wage earners compete with this influx of Boston money? Where do we go? And please don't say Pawtucket -- that place is almost as expensive as Providence at this point unless you can afford to buy. These new condo developments do not exist in a vacuum. The cost of living here is growing across the board. I'm afraid it will choke out all the wonderful things that make this city so vital.

[provid]

It's really nothing you can compete with. Prices every where

[Cotuit]

Obviously this is the case. But how do Providence wage earners compete with this influx of Boston money?

<{POST_SNAPBACK}>

This affordability factor is something that the city and state have to think about very carefully and be proactive on. We certainly don't want to see longtime Rhode Islanders forced out of state, we'll be better off having a multi-income community in Providence. Obviously the years and years of mostly quite low income residents has not been good for the city, and having mostly upper income residents will not be good either. Service sector employees need to be able to live in the city where they work, artists need to be able to afford to live and work in the city. Providence can look to Boston and see where Boston did not take action to keep the pressure off it's low income residents, and hopefully we can learn from what has happened in Boston. We need to be on our leadership to make sure they keep affordable housing a high priority in the city, and not just out in Elmwood and South Providence, but everywhere in the city.

The reality though, is that an Eagle Square or Rising Sun type rehab, or what Buff Chase is doing Downcity is not cheap. It is not realistic to expect these developers to take a loss just to maintain an arts community in the city. The arts community needs to help themselves. Groups like AS220 and RISD need to take a lead on organizing artists to create their own arts spaces that they have control over. No one is going to do it for them. Certainly though there should be input from the city and the state, tax exemptions, development grants, donations of property where possible.

I think the arts community needs to look away from the mill spaces they have occupied for so long as well. mikepl put it very well, "If tomorrow your car is considered a collector

[miriam]

No, these rehabs aren't cheap. however...

These developers are standing on the back of the artistic community that made these areas desirable in the first place. If gentrification is one long, continuous process beginning with risk-taking artists, then developed by deep-pocketed investors and finally consumed by yuppies from Boston, why don't the artists get the same governmental support as the developers? I would love to see the numbers, but I'd be very surprised if the amount of money for public arts funding in Olneyville nearly approaches the monetary incentives poured into the so-called "Promenade District" developers.

I've seen several posts in which people seem to be amazed that a city so small can contain such a rich arts scene. I'll tell you why Providence has such great art: Because artists can afford to live in Providence and make art. They're not waiting tables all day or compromising their creativity to make something marketable to pay their rent. That's the purview of our nation's larger cities, where artists have to compete for food and shelter with investment bankers and middle managers. Here, we have an affordable, fertile environment in which to create. Providence arts never used to *need* much subsidizing or patronage because living and working here was so cheap.

Since I found this forum, I've shown it to several of my friends. Reading through it, some of them were actually brought to tears. It is a terrible feeling to know that your way of life and future stability might be sacrificed on the altar of "urban renewal." I wish that there was some way to make people understand the gravity of this situation. Do you understand the gravity of this situation?? The cavalier attitude I see here towards gentrification is dangerous, disturbing and offensive. Anyone who measures progress by how many '88 hondas along Vally st. are replaced by benzes, as one poster put it, is not someone I want to live near. There goes the neighborhood, as they say. That kind of progress is a sham.

ah, I'm sorry for the ranting. I guess there's not much that can be done. Maybe we'll all pick up and move to Montana. Just promise y'all won't follow us over there once Providence living reaches "New York prices" whatever that means.

m.

[KRC]

ah, I'm sorry for the ranting. I guess there's not much that can be done. Maybe we'll all pick up and move to Montana. Just promise y'all won't follow us over there once Providence living reaches "New York prices" whatever that means.

m.

<{POST_SNAPBACK}>

Rant! Please. I agree with you 100%. I don't want these facts to impead progress, but you are completely correct that those that put in the effort to make this city the attractive place it is are being forced out. Just please don't move us all to Montana! Yuck.

[Garris]

Wow,

Quite a post Miriam, and some of what you say I agree with 100%, and other things you mention make my blood boil. There are some who would argue (I being one of them) that there are elements of your "ranting" that are entitled, self centered, and downright childish. The type of "We deserve the support of society because of the beauty we create. I mean, we're artists for God's sake!" It's a stereotype that oftens turns the public against the art community.

I'll take your points in turn:

These developers are standing on the back of the artistic community that made these areas desirable in the first place.

I'm tiring of hearing this. I wasn't in Providence during those Renaissance years, but from reading the articles and books I have, it seems like the city's rebirth was a fairly complex process. The coming together (with a lot of luck) of initiatives from urban planners, politicians, financiers, artists, the University community, and the economy as a whole. To say that those building on that success today are just "standing on the back of the artistic community" strikes me as a bit simplistic and bombastic. Brown University is expanding it's medical and biotech offerings, expanding their training opportunities, which is in part why I'm here. Do I owe the artistic community anything as well?

If gentrification is one long, continuous process beginning with risk-taking artists, then developed by deep-pocketed investors and finally consumed by yuppies from Boston, why don't the artists get the same governmental support as the developers?

Well, they do get governmental support. The same? No, and this is a valid issue. But, some would argue (as a recent prominent national study did) that the arts are like sports stadiums... They bring back investment, but not nearly as much as is thought and claimed. Something like, for example, the tax cut to rehab historic structures probably will bring Providence back more in investment than any similar arts initiative ever could. Society supports monetarily what it values, for better or worse.

The arts community ranting, rather than at housing prices, should be yelling just as loudly for increased arts education in the schools, which studies have shown directly correlates into more appreciative and engaged future arts patrons.

Because artists can afford to live in Providence and make art. They're not waiting tables all day or compromising their creativity to make something marketable to pay their rent.

I know many "artists" myself, and some can fully support themselves with their art, others need to do other jobs. It's just part of the landscape. No one ever promised artists that what they do would be guaranteed to support them without other work. Most of the folks I know went into the artistic field with their eyes wide open on this. They knew they could be a teacher, or a real estate agent, or a store manager, or an architect, and do much better. But those chose the arts. My job often asks me to stay up 40+ hours straight without sleep, and expose myself to considerable disease risks and liability. It may suck, and we may beotch about it, but it's part of the job. If we don't like it enough, we can go do something else...

Since I found this forum, I've shown it to several of my friends. Reading through it, some of them were actually brought to tears. It is a terrible feeling to know that your way of life and future stability might be sacrificed on the altar of "urban renewal." I wish that there was some way to make people understand the gravity of this situation. Do you understand the gravity of this situation??

Oh, I understand. I don't know how to respond to you here in a way that you'll "understand." I mean, as recently as 10 years ago, Providence was considered a though-and-though failed city. No value to it at all, the "armpit of New England." It was certainly affordable then. My neighbors in Wayland Square bought their condos then for, like, $70,000 and they run $300,000+ today. I knew people with graduate school salaries who had apartments on Benefit overlooking the city, which is impossible today. You can't have your cake and eat it too. You can't take a city left for dead, dangerous and deserted, and turn it around and not expect prices to go up, since then no person will want to invest to make that turn-around happen because they won't be able to make money.

What is your practical, reasonable, economic model for how to turn around a city and not have prices go up?

And frankly, this area is still far from unaffordable. East Providence, many areas on the West End of the city, Pawtucket, areas of Fox Point, etc. are still quite affordable, and the region as a whole is still probably undervalued. I see rents around the city for as low as $500 a month. You, as an artist, probably could have easily afforded to live in Downcity circa 1990. Will you as an artist be able to live on the Westminster Street of 2010? Probably not. But you likely won't be priced anywhere more than a 5-10 minute walk-bike-bus ride away. Try doing this in the metro Boston region or NYC metro region at all.

Things change. My parents at an age younger than I'm at now, built a four bedroom home on more than an acre with an income significantly less than I make now (adjusted for inflation). That area was considered a rural "frontier" community North of NYC at the time. Today, it's a full-fledged suburb where the average home goes for $500,000 plus. I could never afford a place there today with my current income, and neither could someone doing what my parents were doing at that time today. Things change. Does it suck? Yes, but just as my parents took a chance on a "frontier" community then, today's community of opportunity may lie elsewhere. Maybe Buffalo, NY? Or Baltimore, MD? Perhaps Bridgeport, CT or Hartford? Providence of 1995 was definitely a "frontier" investment...

But, despite this, I was still able to afford a place on the East Side of Providence last year. That's an inkling of how undervalued this city still probably is.

The cavalier attitude I see here towards gentrification is dangerous, disturbing and offensive. Anyone who measures progress by how many '88 hondas along Vally st. are replaced by benzes, as one poster put it, is not someone I want to live near.

I will agree that the analogy is somewhat crass. But I think the implication was that there is an improvement in other indices such as crime and cleanliness. In general, professionals like to live near other professionals, just like artists like to live near other artists... For better or worse...

And let me tell you, many of those people in the '88 Hondas are my patients, and they'd trade their lifestyles in for those of my artist friends in a heartbeat.

That kind of progress is a sham.

Um, no its not. That kind of progress changes things for everyone involved, but it's not a sham. This kind of progress often stabilizes regions and economies that floats the boat for everyone. Have the enormous improvements in Manhattan, or Boston, or New Haven, or any of the NE urban areas devastated the arts community in those areas? Devastated the middle class? I don't think so. Everything may have gotten shuffled around a bit, but in general, these areas are thriving and have lower unemployment rates than they have in a generation.

So, what's my take on things? I think everyone is a bit right. There's no doubt that there is a housing pricing pressure being put on RI wage earners that RI employers will eventually have to address. Workers in RI, who in many fields make 25-30% less than their CT and MA counterparts, will no longer find competing against those individuals for housing to be desirable and, if things don't change, they will leave RI (as I know some are doing for MA or PA or other states) and it will be difficult to attract workers here (as some employers are already saying is happening). Employers will eventually have to raise salaries to compete. Where will they get money to do this? In part from their real estate holdings, which are helping fatten their bottom lines.

I still think the region as a whole is undervalued. Is the top end of the market here somewhat overvalvued? Probably. There are whispers in the real estate community that those people who bought the random newly constructed condo on the East Side for $800,000 3 years ago is only getting $600,000 when they turn to sell it, for example. And those following the real estate market can't help but notice that some high profile properties aren't really moving very fast.

But I think all of the attention on the high end is obscuring the reality that this area is still, on the whole, fairly affordable. I lived in a city in Minnesota that was having a boom 10 years ago very similar to that of Providence and eventually it capped out since the reality of what people were making bumped up against the housing market. I'll happen here too, although the presence of the Boston market so close is a wild card, but the same will have to take place there too.

Take a gander at the link Cotuit posted about the Boston market... Wow... You think things are nuts in lil' Rhody? Check out the Boston condo market!!! It helped to check some of thoughts about what is going on in RI.

- Garris

[miriam]

Garris,

I agree with you that demanding more public funding for artists isn't such a great way to guarantee positive economic growth for a city, but I'm not convinced that this reckless redevlopment and wooing of out-of-stater is the way to go either.

The point I was trying to make is that providence's low cost of living allows local artists to do their thing without relying on much public funding, to opt out of the starving artist rat-race that you describe. I'm sorry if I came off sounding entitled. Nobody I know is looking for a handout.

Sure, the Providence rennaisance isn't soley the result of the artists. The Universities and other agents have played a large role in this renewal, but I was talking about Olneyville. In the context of that specific neighborhood, I think it's safe to say that there would be no development there right now if not for the already established artistic community in place.

The arts community ranting, rather than at housing prices, should be yelling just as loudly for increased arts education in the schools, which studies have shown directly correlates into more appreciative and engaged future arts patrons. 

First of all, the arts community *is* ranting at the public schools for increased arts funding. But the way I see it, it's six of one, half a dozen the other. Use the money to pay the school district fund the arts or leave the artists and the activists to their own devices, and they leverage their inexpensive living situation to volunter their time or work for low wages doing good things like...

- teaching free english classes to recent (often undocumented) immigrants: http://www.englishforaction.org/en/Home.php

- providing arts and literacy education as well as work skill development for under-privileged and at-risk youth (especially those in or transitioning out of the criminal justice system): http://www.bss220.org

- providing free bicycles and bike maintenance training to kids living on the south side: http://www.recycleabike.org/

- organizing community garden projects in some of the poorest sections of this city: http://www.southsideclt.org/

...and so much more. All this is possible because people here have the time and financial freedom to do the things that matter to them on a shoestring budget provided by philanthropers and public funds. I'm just not convinced that attracting a more affluent population will help raise Providence living standards any more than the sweat equity of concerned citizens who have a real stake in the future of this city.

Now if you can get both of those forces working together, that's some seriously awesome stuff. Appointing Bert Crenca, co-founder and artistic director of AS220 to the Providence school board is a step in the right direction. Puente, a mixed-use development project headed by the civically-minded daughter of Mr. Struever (i.e. of Struever Bros. Eccles and Rouse), looks promising.

If Providence becomes a Boston bedroom community, then you're replacing these concerned locals with people who spend 8 hours in an office in another state and three hours commuting five days a week. Where does their coveted capital go? To the banks if their mortgaging or landlords if they're renting? To a private school and the service industry? To MA income taxes? How does this help Providnce? What's trickling down and where?

I'm all about getting more money and commerce into this city if it will improve the lives of its residents, but I don't think that the type of economic growth going on right now is necessarily the recipe for improving quality of life here.

Miriam

[provid]

Don

[Cotuit]

These developers are standing on the back of the artistic community that made these areas desirable in the first place.

<{POST_SNAPBACK}>

No they're not. There was nothing desirable about Olneyville or the Promenade before the developers came in and started rehabbing the mill structures. The only thing desireable was that there were nearly abandoned buildings that artists could squat in for little or no money.

In other areas such as the Lower East Side in Manhattan or DUMBO in Brooklyn, artists have created a cafe community around their enclaves that attract other non-artists and patrons of the arts, and then eventually developers. This is not what happened in Olneyville. It is the developers that are making that area desirable by renovating the fantastic structures that were built a century or more ago. It's happenstance that there was a community of artists living in that area before the developers arrived.

[raypacia]

I agree, Cotuit. The existence of artists per se doesn't seem to do much to drive up the intrinsic desirability of a neighborhood. It's how they communicate with their surroundings that matters. And in the case of Olyneville, I'd agree there was little to none of that. I think of Olneyville and I think of Wes's Rib House, not a nascent arts district from whence the continued vitality of Providence flows. If I remember some Projo coverage from a year or so back, most of the big devleopers revamping the old Olneyville mills are from out of state and displaying commendable confidence in the neighborhood. If anything, these are the people who are putting weight on their own backs, with little prodding from anyone else.