Just two affordable housing units were built in Cape Elizabeth from 2010 to 2020, putting the town significantly behind the pace of other communities in Cumberland County, according to a consultant’s study.
Consultants suggested the town set a “moderate” goal of 200 new affordable homes in town by 2032 and an “ambitious” goal of 450.
From 2010 to 2020, according to the second phase of the town’s Housing Diversity Study, Cape Elizabeth increased its housing stock by 108 units. Just two of those are deemed affordable, increasing the town’s affordable housing stock from 36 to 38.
“The town has underbuilt relative to the county,” Tom Dworetsky, director of research at Camoin Associates, the consulting firm working with the town, told the Town Council Tuesday. “The town has about 2.7% of the county’s housing stock, but only created about 1% of new units over that decade.”
If Cape Elizabeth is to do its “fair share” in addressing the county’s housing crisis, it will need to add 375 new units in the next 10 years, according to the study.
Demographics in need of affordable housing include seniors, young families, workers both commuting to and living in Cape Elizabeth and young adults living with their parents, the consultants said.
The council, along with a citizen advisory committee being formed, will explore ways of encouraging the construction of affordable housing once their work with the consultants is completed.
Consultants also say many residents are struggling financially to remain in town or soon will be. Roughly 21% of Cape households, or 756, are considered “housing cost-burdened,” paying more than 30% of their income to put a roof over their heads. Roughly 65% of cost-burdened households earn less than $50,000 annually.
While the number of cost-burdened households in town has dropped from 35% to 21% since 2010, consultants say it is evidence that homes in Cape Elizabeth are more attainable for the wealthy but not for others.
“You have fewer lower-income households in your town; that’s why it looks like the rate of cost-burdened is declining,” Dworetsky said. “But that’s not really a result of town policy or efforts to create affordable housing. It’s just you have fewer lower-income households in the community, period. So, we’re seeing less opportunity for those lower-income residents to buy in Cape Elizabeth and build wealth.”
There are 2,500 households with people age 55 and older in Cape Elizabeth. Of those occupied by residents 65 and over, 380 are cost-burdened, according to the study.
Even those not cost-burdened may have trouble staying in town if the housing stock does not grow “because they just don’t have options to downsize in the community,” Dworetsky said.
The study also found that 924 workers, from restaurant and retail workers to police officers and firefighters, commute to Cape Elizabeth.
Over half of the town’s 18- to 34-year-old population lives with their parents, compared to 28% countywide.
The study said one-quarter of residents could not afford to move to another home in town if they wanted to. From 2017 to 2021, the median sale price of a home in Cape Elizabeth jumped 45% from $475,00 to $687,500.
“More than half the houses were affordable to people with incomes in the top 25%,” said Councilor Gretchen Noonan. “So, there’s plenty of supply for the people (with an annual income of) over $200,000 and none for the people under $75,000 or even $100,000. That should kind of shock and worry everyone I would think. It’s just not sustainable, not tenable.”
One tactic to serve most targeted demographics is creating more rental units, consultants said. There are 392 rental units in Cape Elizabeth, representing 10% of all occupied units in town. In comparison, 30% of housing units in Cumberland County are rentals.
However, that’s just one spoke in the wheel.
“We need smaller houses, duplexes, maybe some moderately sized apartment buildings,” Noonan said. “We just need that diversity.”
One resident at the council meeting Tuesday, Matt Jordan, alluded to a similar study conducted in South Portland that calls for a regional approach to the housing crisis.
“South Portland and Scarborough … have been building a decent amount of rental units,” Jordan said. “If we as Cape Elizabeth went to them and said, ‘Hey, we’re going to do our part, let’s collaborate and build a certain number of units based on our relative wealth, relative share of the population,’ I think that could be very impactful.”
The council is scheduled to meet with the consultants for a third and final time Aug. 8, when they will consider land-use regulations and other actions they can take as a municipality to create more affordable housing.
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