Cape Cod’s housing Catch-22

Low inventory, high prices driving year-rounders away

MELANIE SMALL has been out of a home for about a month. She was living in a rental in Orleans with her 8-year-old daughter until her landlord sold the unit and she had to move out. She was given advance notice and had about a year to look for a new place, but inventory was low and what was available wasn’t affordable. 

Small works three jobs. In the summer she shucks oysters for the Holbrook Oyster Company, during the school year she is a cafeteria worker at Orleans Elementary School, and she just started a year-round bartending position at Hog Island Beer Co., a brewery in Orleans. 

Since their lease ended, she and her daughter have been relying on friends and family for shelter and moving often. “It’s hard for an 8-year-old to have to keep moving so much. It’s just kind of stressful not really knowing where we’re going to go,” she said. 

Small is far from alone in her struggle to find housing she can afford on Cape Cod, where she grew up and put down roots. 

For many long-time Cape residents, losing a lease means packing up their lives and moving elsewhere. Alisa Magnotta, CEO of the Housing Assistance Corporation, said people call her office every day looking for help and it’s disheartening for her to explain there’s nothing available. 

She watches the cycle repeat itself: a renter loses their unit and is forced to give up their job, pull their children from school, and leave the shoreline community behind. “We are losing our communities—our workforce—and families are being displaced due to poor housing policy and a lack of urgency,” she said.

The issue is one of both low inventory and high prices, with each factor exacerbating the other. When the pandemic hit, the housing market went wild. As inventory dropped and prices soared, Massachusetts’ iconic seashore felt the market pressure acutely. Barnstable County saw its median sales prices rise 33 percent between spring 2020 and 2021, the fourth highest jump in the country. On top of that, high demand for seasonal rentals and an aversion from existing homeowners to densify the area pushed an already competitive market to its limit. 

When determining rental assistance programs, the Department of Housing and Urban Development assumes that no more than 30 percent of an individual’s income should go to rent and utilities. In 2019 the median income for an individual in Barnstable County was just over $36,000. But finding a unit for $900 a month—utilities included—is not likely. Magnotta said one-bedroom units are going for $1,500 or more per month. For two bedrooms, the rent jumps to $1,800. 

The median rent in Barnstable County is higher than in 98 percent of the country and 75 percent of counties in the state. 

Even for those who can afford to rent, the inventory just isn’t there. Magnotta said that when a rental opens, there will be hundreds of inquiries. She said people are turning to social media to search for places, filling platforms with desperate posts about losing housing and finding nowhere else to go. 

Mike McNamara, owner of Hog Island Beer Co., said housing is a struggle for many of his employees, especially during the summer. It’s not uncommon for workers to spend a few weeks on a friend’s couch, waiting for a rental to open up and he’s heard of some people staying in their cars.

McNamara recently lost a manager because the home her family rented in Yarmouth was sold. She couldn’t find another affordable year-round unit, so she moved to Florida. “The lack of housing literally forced them off [the] Cape and out of Massachusetts,” he explained. 

A sign at Lily’s Diner in Chatham warns of a staff shortage on Cape Cod. (Photo by Shira Schoenberg)

The housing struggle on the Cape is not new, and advocates have long been warning that it will continue to worsen. In 2017, the Cape Cod Commission, the regional planning authority for Barnstable County, released a report on housing trends and forecasts. 

The report explains that housing markets typically play by the rules of supply and demand, with rates fluctuating based on what people can and will pay. As a vacation hotspot, seasonal demand interferes with that on the Cape. 

Following the 2009 housing crisis, demand for seasonal units from Boston and New York City dwellers skyrocketed. Some new units were built, but many existing homes were converted from year-round to seasonal occupancy. The result was a 3,000-unit decline in year-round residencies from 2010 to 2015 and a huge discrepancy between affordable inventory and need.

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The gap was worst for households making 80 percent or less of the area’s median income. For that population, there were an estimated 26,364 too few affordable units in 2015. But the researchers projected that by 2025 the stress will have crept up to significantly impact those making 100 to 120 percent of the median income. 

Small isn’t optimistic the market will open up any time soon. “There’s just nothing, unfortunately,” she said. She has applied for programs through Habitat for Humanity and other resources, but waiting lists are long. For now, she and her daughter will continue to stay with family while they work out a long-term plan.