While communities statewide are struggling to cope with issues surrounding housing for working families and low-income residents, the greater Newport region is witnessing the extreme of these issues. Without the intervention of a concerted effort to make more housing available for working individuals, we will lose opportunities to enhance the vibrancy of our communities; in fact, we may be seeing this loss already. The data is clear and should be a call to action for our leaders and all residents of the region.
We are seeing an unprecedented disparity as a typical homeowner in the “Connect Greater Newport” region now pays $135,000 more than they would for the median-priced Rhode Island home and over $55,000 more than the United States median.
While we have a diverse array of employment opportunities as a result of our core industry sectors, worker income levels are not keeping up with skyrocketing sales and rental rates. Our analysis shows that the household income needed to afford a median-priced home increased by 44 percent over a five-year period, while wages for top industries like manufacturing rose 37 percent; professional, scientific and technical, 15 percent; health care, 15 percent; and accommodation and food, 35 percent. This mismatch creates a widening gap for workers across industries.
The growth we have seen in the total number of housing units has been led by a surge in high-value, owner-occupied units and a drop in lower-value renter-occupied units. A continuation of this trend will mean that workers who support our communities, including teachers, firefighters, hospital workers, and those in the maritime industries, will no longer be able to live in our communities.
Our analysis shows the income-to-housing cost mismatch in another way. Households earning less than $100,000 make up 57 percent of households in the region. Homes affordable to households earning under $100,000 made up 24 percent of home sales in 2020- 2022. The availability of housing for our front-line workers often creates disappointment for many as they search within a shrinking pool of affordable homes.
Our analysis also shows housing and rental costs consistently rising, making it harder for local earners to afford homes in their income bracket and contributing to a population loss of workers aged 30-54. Workers in this age group are sometimes referred to as “prime age workers” because they provide stability to local businesses, start families, and put down roots. From 2010-2019, the region lost almost 1,100 workers aged 30-54.
While we have seen an increase in older residents, a lack of needed housing development is putting pressure on the working-age population and those who want to age in place, leading to the cost-burdened status of one-third of retirees and one-fourth of working professionals. “Cost-burdened” refers to households paying more than 30 percent of their income on housing. This lessens their ability to enjoy our great community amenities and, worse, puts them at risk of any disruption causing them to be forced to move or allowing deferred maintenance to continue on their property.
This is the first in a series of editorials resulting from our recently published report, “Housing Analysis for the Greater Newport Region.” In future editions, we will share what employers are saying, identify opportunities for change, and document the lost opportunities that result from this imbalance. As the state legislature, under the leadership of Rep. Joseph Shekarchi, debates a set of initiatives to address statewide issues, we want to make sure our region understands the severity of the issues in our backyard and the importance of advancing policies and initiatives that help address the housing gap, especially for working families.
Erin Donovan-Boyle, Greater Newport Chamber of Commerce Rich Overmoyer, Fourth Economy Consulting
Editor’s Note: For more on the local housing shortage, see Island Looks at Solutions for Housing Crisis in NTW’s May 18 edition and online