The Town Council held the first of three scheduled workshops dedicated to the Housing Diversity Study on Monday, May 23, 2022.  The first workshop examined the housing data collected by Camoin Associates as presented in the report Volume 1: Housing Data Package.  Camoin Associates were selected to conduct the study following the reissued Housing Diversity Study RFP of February 16; the council approved contracting with Camoin Associates on April 11.

Reviewing the data from Camoin Associates were Tom Dworetsky, Director of Research and Data Analysis Lead, and Dan Stevens, Director of Real Estate Services. Dworetsky said that the purpose of the study is to assess current housing conditions and “Provide options to create affordable housing in the community.”  The goal for the first workshop Dworetsky said, “Is to lay a foundation of solid data to inform the next stage of analysis” and the creation of housing goals.  

The study compares Cape Elizabeth with peer communities: Scarborough, South Portland, Falmouth, Cumberland, and Yarmouth.  The study states that these communities are, “The same set of communities used in the town’s 2019 Comprehensive Plan.”  In addition, data from Cumberland County, Maine, and the United States is included in the report  as appropriate. The material from the Volume 1: Housing Data Package report was divided into three categories:  

• Demographic and Economic Profile 
• Housing Inventory and Market Trends
• Development Environment.  

 Each section includes key findings.  Data from the 2020 Decennial Census, which looks at every individual, and the 2016-2020 American Community Survey (ACS), which looks at a sampling, was used in the report.

The Demographic and Economic Profile  presents data on Cape Elizabeth’s population and economy.  Key findings taken directly from Volume 1: Housing Data Package and the workshop presentation show that:

• Cape Elizabeth has grown more slowly than its peers over the last two decades.  From 2000-2020, the town grew by 4.6% and added 418 residents compared to Cumberland County’s growth of 14.1%.

• Cape Elizabeth has proportionally fewer one-person households and more households with four or more individuals compared to the county.  Approximately 30% of all households in Cape Elizabeth are family households with children, compared to 23% in Cumberland County as a whole.

• The community’s youth population has declined.  The town’s population under the age of 18 has fallen by 14%, between 2000 and 2020.  According to the 2020 Decennial Census, 22% of Cape Elizabeth’s population is under the age of 18.  Cumberland and Yarmouth were the only peer communities to experience absolute increases in the under-18 population.  All other geographies saw declines in the share of the under-18 population, however.  School enrollment in Cape Elizabeth public schools declined by 11.3% between the 2012-13 to 2021-2022 school years, compared to 6.7% statewide.  Yarmouth public schools had a notable increase of 11.4%. Falmouth, South Portland, and Scarborough all had declines by 6.1%, 7.4%, and 10.7% respectively.  The state average saw a decline of 6.7%.

• Cape Elizabeth has the highest estimated median age at 47.9 years of all geographies (ACS 2016-2020).  The town’s median age is 5 years older than in Cumberland County, and 10 years older than in the US overall.  There is an under-representation of younger adults in the 25-44 age range as compared to the county, state, and nation and an over-representation of adults in the 54-74 age range.  Children are not significantly underrepresented. 

• Housing affordability plays a role in delaying the age at which families with children can afford to move into the community.  Despite the lack of younger adults, Cape Elizabeth households are more likely to have children than in Cumberland County as a whole.

• The senior population of 60+ years has grown.  In 2010 this group comprised 24% of residents, compared to 34% in 2021.

• Cape Elizabeth is home to an increasingly concentrated population of high-income individuals.  Median household income in Cape Elizabeth grew from about $77,000 in 2010 to approximately $127,000 in 2020; making it the highest median household income of any peer communities, more than double than that of Maine, and nearly 70% higher than Cumberland County.  Within Cape Elizabeth, 26% of households have income greater than $200,000, compared to 11% in Cumberland County.  Fewer than 6% of the town’s households have income below $25,000, compared to 14% county-wide.

• There are three times more workers living in Cape Elizabeth than there are workers employed in Cape Elizabeth.  An estimated 72% of workers employed in town commute from elsewhere, while 91% of working residents work at jobs located outside of Cape Elizabeth.

Key findings for the Housing Inventory and Market Trends as reported in Volume 1: Housing Data Package and workshop presentation show that:

• Cape Elizabeth’s low population growth is tied to housing production.  From 2010 to 2020, the town added 108 housing units on net, an increase of 2.7%.  In the same time period several peer communities registered double-digit gains; Scarborough increased its housing stock by 20%, Cumberland by 14.2%, and Falmouth by 12.7%.

• Only 10% of Cape Elizabeth housing units are renter-occupied, compared to 30% in Cumberland County. The town has the highest share of owner-occupied housing among peer communities; 90% are owner-occupied.  South Portland has the lowest share at 64%. Low overall rental inventory limits the types of households that can consider Cape Elizabeth as a place to live.  Four percent of the town’s housing stock is seasonally vacant, compared to 10% county-wide and 17% state-wide.

• Growth in median home sale price has far exceeded median household income growth.  The median non-oceanfront single family home sale price in Cape Elizabeth surged by 107% between 2011 and 2021, from $336,250 to $695,000.  This compares to median household income growth of 66% in Cape Elizabeth between 2010 and 2020, and 37% in Cumberland County.  During the 2011-2021 time period, oceanfront single-family median sale price rose 80% to $2.1 million and condominium median sale price rose 99% to $607,500 in town.

• Approximately 750 households in town are considered cost-burdened, or 21% of all households in the community.  Cost-burdened is defined as a household that spends more than 30% of its income on housing costs such as mortgage, taxes, and insurance.  When examining households earning below $50,000, about 454 households, are cost burdened, or approximately 65% of all households in this income range.  Seniors comprise a disproportionate share of the cost-burdened households at 50%.

The Development Environment section of the report aims to reflect how housing developers that are generally coming from outside of Cape Elizabeth, are going to regard the town in terms of its development potential. Development capacity, regulatory environment, and community sentiment provide foundational understanding for future strategy development. 

As reported in Volume 1: Housing Data Package and workshop presentation:

• Current town zoning regulations have restrictive density requirements that are generally prohibitive for the development of workforce or affordable-level housing.  While multifamily is allowable as a use, the town’s zoning requirements greatly limit both the scale and feasibility of development, particularly for affordable/workforce level multifamily housing.  In comparison to peer communities, Cape Elizabeth ordinances ranked as most limiting in terms of allowing for multifamily housing.

• Short term rental permits issued within town have declined since new regulations were adopted in July 2021.  In 2021 44 permits were issued; thus far in 2022, 26 permits have been issued.  Other communities have seen an increase in short term rental units, which puts pressure on housing pricing and availability.

• There is an extremely limited supply of potentially-developable land for housing, suggesting that time is limited to create attainable housing before the town is effectively built-out.  There are few undeveloped parcels with zoning and infrastructure required to accommodate multifamily affordable housing development.

• High land costs and competitive market for land are significant challenges to financial feasibility of developing attainable-level housing.  

• There is split public opinion in the community with respect to support for affordable/workforce housing.  Past polling of the public has found somewhat polarized opinions with respect to affordable housing, with a slight majority in support of new affordable housing options in the community.  A survey from the 2019 Comprehensive Plan in Cape Elizabeth showed that 49% supported residential development, while 42% opposed. 

Following Camoin Associates’ presentation, councilors were given time to ask questions.  Chair Jeremy Gabrielson asked if the data quality and quantity available for the study is sufficient, “To make informed policy decisions?”  Dworetsky answered that the Decennial Census is the “gold standard,” but that the full report will not be available until the summer of 2023.  In the meantime, the detailed demographic data coming from the 2020 ACS is based on a five year sampling taken from 2016 to 2020.  “While not as up to date as ideally you would want it to be,” Dworetsky said, “the degree that the data might be off, I believe would not be significant enough to change the direction of any policy decision you would make.” Furthermore, the town assessment data is comprehensive as it looks at the full inventory of housing and sales, “We know with a good degree of certainty what the median sales price for a home is; it’s really pricey,” Dworetsky said.

Gabrielson asked if there was more financial information on the seniors in town who fall in the “cost burdened” category who might have, “Relatively low income, but have a sizable retirement that they are able to draw on?”  Dworetsky said that there isn’t great data out there on household assets; “Which presents a limitation, especially in these older cohorts where assets can be considerably higher.  You have to work with the data you have; that is what HUD [U.S. Department of Housing and Urban Development] uses and what most of these policies use when they look at policy catering to seniors.”

In response to a question about why the 25-45 age group is underrepresented in Cape Elizabeth, Dworetsky cited a national statistic that indicates, “The median age of a first-time homeowner is somewhere around 34; by that age people are looking for their first opportunity to buy a home and Cape Elizabeth is really not a starter-home community.”  Stevens added that the younger side of that age range are typically looking for rentals or for affordable owner-occupied options such as townhomes and duplexes, “And we don’t see a lot of that in Cape’s housing stock.”

Councilor Gretchen Noonan observed that the, “Striking increase in condominium prices is concerning because there are fewer affordable options for [older] people to downsize to and then we have fewer of those single family homes opening up for families to move into.”  Additionally, Noonan pointed out that while the Camoin Associates reported that there are 26 short term rental permits, she found “there were 46 listings online.”

Noonan asked Town Planner Maureen O’Meara to clarify the difference between the terms “multiplex” and “multifamily” as used in zoning ordinances.  O’Meara said that there is no significant difference, “The only difference is that multifamily is the term we use in the business district and multiplex is the term we use in the residential district. Multifamily housing in the commercial districts is your classic apartment that is above commercial uses; whereas in the residential district it is usually whole buildings that are residential.”

Councilor Nicole Boucher asked for comparisons on the percentage of Cape Elizabeth’s cost-burdened seniors with other areas, “What is the typical percentage of cost-burdened seniors in our area, in the state, and nationally?  I want to know if we are trending worse off than other people.”  Dworetsky said that, “It is common for seniors to be disproportionally cost burdened in any community as they have less income, but I will have to get those statistics.” 

Boucher commented that she is concerned about the, “Age gap in the 25-45 age range,” and asked, “what does that underrepresentation mean for Cape in the long term?”  Dworetsky responded that, “The data shows that it is not really having an impact on school enrollment as one might think.  There has been some decline in enrollment, but kindergarten enrollment is rising a bit. There are still people who are moving to Cape Elizabeth for the schools; they just might be a little bit older than happens in other communities.”

Councilor Timothy Reiniger asked for clarification on why the number of cost burdened households as listed in the Camoin Associates’ report has decreased, “In comparison to the 2019 Comprehensive Plan?” Dworetsky said he would take a look, but offered that, “One explanation could be that lower income folks are being forced to look elsewhere because they can’t afford to live in town.”

In response to Reiniger asking how to view a decline in short term rentals, Stevens answered, “I wouldn’t frame it as good or bad.  It has implications in terms of housing availability and housing affordability specifically.  We work with communities that are dealing with the opposite issue; institutional buyers snatching up properties for short term rentals and out of area folks buying ten houses at time for short term rentals; and that has significant implications for housing availability in those communities and the year round population.  Here [Cape Elizabeth] that doesn’t appear to be an issue because of the way those regulations are set up. When you talk about wanting year-round population and availability of affordable housing, by not increasing those short term rentals you are supporting availability in lower prices.”

Councilor Penny Jordan drew from the data that, “If we don’t have a lot of places where building can happen, then one needs to address density issues.  If we want to free up housing stock and we want seniors to stay in town, we have to think of ways to entice them into other housing options, while at the same time look at how we can entice families and others to move into town.”  Jordan continued, “The findings start to guide you in the direction of where we need to focus our attention; and where it is that we want to put our priorities; and how do we get there. Is that where we are at?”  Dworetsky confirmed that the next task of the study will be to, “Set goals looking at particular populations that the town may want to target; then provide a range of goals that the town could potentially seek to achieve with that regard and of course it will be up to you all to decide which ones are the priority for your community.  The third task will be around strategies and how to get there.”

Jordan asked if Camoin Associates has worked with other towns that also, “Have a finite amount of land and are land constrained in order to address these issues?”  Dworetsky answered that Cape Elizabeth’s situation is common in a lot of other “coastal communities throughout the northeast where they are largely built out.  In the end it comes down to density; where are you going to increase density?  There are different ways to do that; different styles of housing; there are different ways to make it fit with the community. But, at the end of the day, it’s more units per acre.”  The town will have to determine what are “acceptable goals” and consider “Loosening restrictions to allow the market to offer a greater variety of housing types in town and creating incentives for different housing stock,” Dworetsky said.

The next deliverable from Camoin Associates is due June 20, 2022.  The consultants are tasked with drafting specific housing creation goals. The Town Council will hold a workshop on June 27 at 7:00 p.m. in the council chambers to discuss the second task.

For more information on the Housing Diversity Study schedule, documents, and workshop recordings, please visit the Housing Diversity Study page found under the Town Spotlight section of the town homepage.