Feature
Desperately Seeking Housing
Why it’s so hard to find a home in the Hudson Valley
By Todd Paul. Illustration by Virginia Lavado

Valerie and her daughter live at Family of Woodstock’s Darmstadt Shelter in Kingston. Previously, they lived for six months at the King’s Inn, an old motel used as temporary housing. They had been homeless for nearly a year, unable to find a decent apartment to rentfor the $550 housing allowance Valerie receives each month from Ulster County Social Services.

Valerie’s case is far from unique. The number of homeless families in Ulster County has surged, mostly, according to Family’s director Michael Berg, because there is simply not enough affordable housing. “The root cause of the homeless crisis we are facing is the fact that there have been no significant new housing projects for families in the county in the last fifteen years,” says Berg.

Steven Fischer is executive director of the nonprofit Kingston Housing Authority, Kingston’s largest landlord with 585 units of low- and moderate-income housing. Fischer says there are 765 families on his waiting list—two or three times last year’s number. The situation is similar in Dutchess County. Homes for these families do not exist and are not being built. Instead, developers are targeting affluent New Yorkers who want oversized upstate second and vacation homes, and can afford to pay for them.

Ever since Henry Hudson sailed upriver in 1609, the river has served as New York’s original Thruway, carrying north those in search of scenic vistas, healthy air and water, and cheap land on which to build utopian colonies and rustic chalets. The surviving grand hotels are a reminder of the heyday of Hudson Valley tourism. But tourists and vacationers have always shared the valley with those permanent residents who came to stay—farmers, quarry and mine workers, tanners, loggers, artists, poets, and mystics. The children of those locals had always been able to find accommodations, whether by converting a chicken coop, renting a room, or building on a mountainside. Children frequently grew up and left the region to pursue a career, but seldom to find an apartment.

The days of cheap Hudson Valley housing are waning. For a variety of reasons—9/11, the fall of the stock markets, new housing codes, environmental concerns, NIMBYism, and job losses are a few—the lack of affordable housing has crept to the top of a long list of problems this region faces.

The statistics are stark. Both Ulster and Dutchess counties have about a one percent vacancy rate (five percent is defined by the federal Department of Housing and Urban Development as a “healthy” vacancy rate, representing the best balance between the interests of landlords and tenants. In New York City, anything below a five percent rate defines a “housing emergency.”). Approximately half of renters in Ulster County are “housing cost burdened,” meaning they spend more than 30 percent of their income on housing; one-third of Ulster County’s workforce now works outside the county, with many people commuting over an hour to Westchester or even to New York City, where they can earn enough to afford to live here. Affordable housing, whether rental units or starter homes, simply isn’t being built in Ulster or Dutchess.

In New Paltz, where there are more students than dorm rooms, landlords can rent nearly any space with a roof over it. Recently, according to town Supervisor Don Wilen, some students were discovered living in the hallway of an off-campus apartment house. In Beacon, a new law prohibiting tenancy in storefronts is helping to revitalize Main Street, but forcing renters to find new quarters. In Woodstock, realtors are turning would-be homebuyers away at the door. “I’m in real estate,” says longtime Woodstock realtor Gale Brownlee. “But I don’t want to see it so high-priced that when people come in the door, I have to tell them ‘I don’t have anything for you.’”

The problems of homeless families, students, working class renters, and homebuyers may seem unrelated; that they are very much related is one of the lessons Hudson Valley planners are learning these days.

Seeing the Problem
According to Anne Saylor, housing coordinator for the Dutchess County Department of Planning and Development, the buying and renting segments of the housing market are connected, and “it’s the points of connection in the market that are causing the problem.”

Saylor explains that under ordinary circumstances, people move up in the size and quality of rental housing until they’re ready to buy. But the jump from renting to buying is bigger now. The median price of a home in Dutchess County is $250,000, with Ulster at about $239,000. At press time, there wasn’t a single listing in Woodstock or Saugerties as low as $100,000; in Woodstock, the average price of a house is over $450,000, and according to Chester Straub, president of the Ulster County Development Corporation, the median selling price in Ulster County has risen by more than 25 percent since 2000. Between 1998 and 2002, the median sales price of a house in Ulster County rose 41 percent; the average price rose 52 percent. In his 2003 state of the county address, Dutchess County Executive William Steinhaus stated, “Housing prices have continued to climb, with the median selling price growing 20 percent in 2002 alone.”

Rental housing prices have also increased. Both Ulster and Dutchess counties produce a rental housing survey every year. The 2001 surveys (the most recent available) showed sharp rent increases along with a steep decline in the number of units advertised. For example, the Ulster survey reported average advertised rents for studio apartments of $500 (up 13.9 percent from the previous year). Corresponding rents for one-bedroom apartments were $585 (up 9.6 percent), two-bedrooms were $728 (up 11.7 percent), and three-bedrooms were $880 (up 2.2 percent). At the same time, the survey notes that the advertised rental housing sample was only 78 units, down from 168 in 2000 and 521 in 1998. It concludes, “The modest size of the sample may be indicative of a scarcity of available rentals.”

These figures predate the terrorist attacks of September 11, 2001 in New York City. Anecdotal evidence suggests that the existing trend toward higher housing prices was given a big boost by the events of September 11, which caused many city dwellers to seek safe havens upstate. Steven Fischer, executive director of the Kingston Housing Authority, says his own house has doubled in value since 9/11, and there are many stories of bidding wars and of sellers getting thousands more than their asking price for properties on the day they list them. Landlords have reported bidding wars even for apartments.

Saylor notes that higher rents can be trouble for tenants trying to save enough money for a down payment to buy a house; and when fewer renters are able to buy, rents are driven even higher, into a range that is difficult for senior citizens, single-parent and single-income families, and entry-level employees. Ironically, says Saylor, Dutchess County’s population is diversifying—there are more minority residents, more elderly, and more divorced families (which means one family needs two homes). And, Saylor says, the size of the county’s average household is shrinking, with 56 percent of the population living in one- or two-person households. So the demand for affordable housing has risen much faster than the supply.

What does the rental survey prescribe? “It says we need to build apartments,” Saylor summarizes. “But we’re building ‘McMansions’... $300,000 to $600,000 homes out in the suburbs.... We are building large, expensive, single-family homes...we are not building small, affordable single-family homes.”

Supply Versus Demand
There are several reasons developers have failed to meet the demand for affordable housing in the Hudson Valley. The first is obvious: there’s more money to be made building houses for rich people than for poor ones.

But other factors come into play. Most everyone who studies the problem agrees that NIMBYism is a significant problem for developers. The fact is, people want affordable housing in the abstract; they just don’t want it in their neighborhood. The exception to this rule is senior housing, because seniors are seen as non-threatening. But affordable housing for families is extremely difficult to site.

An example is the recently proposed Creek Locks Commons project in Rosendale, which would have provided 103 units of subsidized housing. “Thirty-seven percent of the people who live in Rosendale currently are in wage ranges that would allow them to live in that kind of project,” says town Supervisor Phil Terpening. Yet, the project stalled due to public opposition, and it now seems likely that the developers will propose full market value housing for the site.

Terpening says the developers and the town should perhaps have approached the project differently, and acknowledges there may have been valid reasons for concern among residents. But, he adds, “I think we do need affordable housing here.” At a recent meeting between town supervisors and realtors, Terpening says, it was noted that if a large company moved into Tech City in Kingston (the former IBM site), there wouldn’t be enough housing in the vicinity to accommodate all the employees. And he worries that many people renting in the area can’t afford to buy a house.

Marshall Beckman, head of Ulster County Mental Health and the county’s new housing consortium, points out another impediment to affordable housing development in Ulster County: Ulster, he says, is the only county in the state that still uses the old town welfare system. Under this system, each town helps pay for public assistance for its own residents. This gives towns an incentive to help residents get off welfare. The downside is that towns also have an interest in discouraging poor people from moving in. There’s a fear, Beckman says, that affordable housing will attract families on welfare and cost the towns more money for public assistance—the “if we build it, they will come” theory.

Two years ago, there was a proposal to eliminate this system, but it was defeated in the county legislature. “We’re the only county that has that system in the whole state, and it is a definite impediment to development,” says Beckman.

Beckman also notes that incomes have not kept up with the rise in housing costs—in fact, income levels in Ulster County have lost ground relative to the rest of the state. According to the 2000 census, the average annual salary in Ulster County was $26,722, as compared with a statewide average of $44,904. And the supply of housing stock has not kept pace with the increase in population. This means there are more people with less money competing for fewer, pricier homes. “It’s a depressing state of affairs,” says Beckman.

Another reason for the lack of affordable housing projects can be traced back to the Reagan administration. According to Berg, in 1985 the federal tax laws were changed to eliminate the expedited depreciation allowable for affordable housing projects. “As a result, there was very little economic incentive for developers to build affordable housing,” says Berg.

It’s becoming increasingly clear that the problem of housing in the Mid-Hudson Valley is both broad and deep, and is entwined with a myriad of other issues—economic development, zoning, and transportation are a few; and that while nonprofit housing and social service agencies are essential, legislative leadership and investment on a county level, if not regionally, is needed to address the scale of the problem. With this awareness has come a new focus on multilateral solutions.

NEXT MONTH: POSSIBLE FIXES FOR THE HOUSING CRISIS

S I D E B A R

By the numbers:

HUDSON VALLEY HOME PRICES

The housing shortage has increased in intensity in the past decade, especially since the northern exodus spawned by the attacks of September 11. Home prices have increased by more than 25 percent in Ulster county and 35 percent in Dutchess county in the past two years. Rental prices in the Mid-Hudson Valley have also shown the effects of the housing shortage, increasing 15 percent and 18 percent in Dutchess and Ulster counties respectively during the 1990s. These upward pricing trends will only be exacerbated by continued migration to the region and the current lack of affordable housing. Mid-Hudson Pattern for Progress, a regional planning group, predicts that the current population, 2 million, will rise by 11 percent, to 2.2 million by the end of this decade.

Median Home Sale Prices By Year

ULSTER COUNTY

1989 $119,000

1999 $107,009

2000 $119,500

2001 $129,900

2002 $152,500*

1/03 $174,900

PERCETAGE CHANGE

2000-2002: 27.6 percent

DUTCHESS COUNTY

2000 $174,000

2001 $200,000

2002 $240,000*

PERCENTAGE CHANGE

2000-2002: 37.9 percent

SOURCE: MULTIPLE LISTING SERVICE,

NYS ASSOCIATION OF REALTORS

*Preliminary Figure

MedianHousehold Income

ULSTER COUNTY

1989 $34,033

1999 $42,551

SOURC: US CENSUS

Per Capita Income

ULSTER COUNTY

1989 $14,921

1999 $20,846

SOURCE: US CENSUS

Median Rent Paid

ULSTER COUNTY

1990 $529

2000 $626

SOURCE: US CENSUS