As costs continue to rise in the Massachusetts residential real estate market, state and local governments struggle more and more with ways to provide affordable housing. Private builders and investors can usually make a lot more money creating luxury condominiums, and without outside help, they may have little economic incentive to create apartments or other housing units that lower-income people can afford. To provide that incentive, some local and state governments offer financing.
Recently, MassHousing obtained $49.3 million in financing for WinnCompanies to assist with the preservation of affordable housing at the Tannery, a 284-unit community in Peabody. Under the agreement, the company commits to keeping the units affordable for 45 years, rather than leasing them at market rates after a planned renovation.
More than a century old, the Tannery was converted to housing more than 40 years ago under a financing program launched by the Department of Housing and Community Development. Under the terms of the new deal, most units in the complex will be reserved for low-income households, as measured by the Area Median Income, which currently stands at $113,000 for a family of four in the Peabody area. Only 49 of the 284 units will be rented at market rates.
According to news reports, dozens of residents will be able to keep their apartments because of the deal.
The Massachusetts residential real estate market is complex at any price point. Builders, developers, investors and others need help from experienced real estate attorneys to find solutions in order to build their businesses and give people a home.