Affordable Housing

The Massachusetts Comprehensive Permit Act (commonly referred to as Chapter 40B) is the commonwealth’s primary affordable housing by-law. At the risk of oversimplification, the overall mandate of Ch. 40B is to ensure that each municipality in the Commonwealth maintains at least 10% of its housing stock at an affordable level.

Some municipalities vary, but it’s safe to set forth some facts about 40B:

To qualify, an “affordable” buyer earns roughly 80% of median income. So, if the average income in a town is $100,000.00, a person making $80,000.00 could qualify as an affordable buyer. Someone whose work is service-focused, a young family, someone new to the workforce, or someone recently divorced may find them-self unable to live in a community in which they grew up, close to their work, or closer to family. The goal of the Act is to give folks the ability to access the services and benefits of those communities.

How does 40B work?

40B is defined as a Comprehensive Permitting Process. Essentially, a developer who is granted such a permit is able to override certain aspects of municipal zoning bylaws and other requirements.

For instance, if local zoning only permits, a single dwelling unit per acre, a comprehensive 40B permit may allow a developer to construct say 10 units per acre in the form of attached condominiums. In such a proposal, 25% of those condominiums would need to be set aside for an affordable buyer as defined above.

So, when a development is deemed “affordable housing,” roughly 25% of the units are affordable if the units are being purchased by the resident. If the units are rental units, the percentage could be as low as 10%. Again, the definition of affordable, means the resident earns roughly 80% of the local median income.

In addition to 40B, many towns in Massachusetts have adopted the Massachusetts Community Preservation Act, which allows Towns to impose a CPC surcharge, with 1/3 of that money going toward affordable housing. Here is a map of the towns in the Commonwealth that have adopted the CPC.

Massachusetts remains one of the least affordable areas in the United States. As realtors, your affordable buyers have tremendous resources to access on of these units. If you think you have a qualified buyer, but aren’t quite sure where to begin, it’s okay, call me.