Worcester-Area Rents Rising, Putting Homes Out Of Reach: Report

WORCESTER, MA — If you earn more than $65,000 per year, you can most likely afford a two-bedroom apartment in Worcester comfortably.

But if you're earning the median wage in Worcester of just over $18 per hour, you'd have to work 84 hours per week every single day of the year to comfortably afford that same apartment.

That's according to the annual "Out of Reach" report by the National Low Income Housing Coalition released this week. The report compares fair market rents in cities and towns across the U.S. against local median wages to determine the gap between earnings and housing costs.

The report found that Massachusetts is the third least affordable state for renting in the nation. A person working full time at the state's $15 minimum wage could only comfortably afford rent of about $780 per month — $1,000 lower than the fair market rent on average for a one-bedroom in Massachusetts.

According to the report, the fair market rent on a two-bedroom in Worcester is about $1,635, which is almost $150 higher compared to the 2022 report. The report uses a U.S. Housing and Urban Development geographic area that includes communities surrounding Worcester, including Westborough, Shrewsbury, Holden, Grafton and Sturbridge.

The twin forces of low rental inventory and stagnant wages are making it hard for renters of all incomes to find housing, according to the Central Massachusetts Housing Alliance.

"Worcester is also experiencing an all-time low rental vacancy rate of 3.3% for all apartment types from luxury apartments to just basic units, according to the American Community Survey," CMHA said in a news release about the Out of Reach report. "The low vacancy rate coupled with high rents is creating pressure for low-wealth renters, particularly those with an eviction record. These renters typically face discrimination in the housing market, particularly if they are Black, Indigenous, people of color, families with children and disability."

Worcester Area from the "Out of Reach" report:

Renter households

• 81,708, 37%

Annual income needed to afford...

• Studio: $49,240
• 1 Bedroom: $50,880
• 2 Bedroom: $65,400
• 3 Bedroom: $79,600
• 4 Bedroom: $87,840

Weekly hours at area median wage to afford fair-market rent...

• Studio: 63
• 1 Bedroom: 65
• 2 Bedroom: 84
• 3 Bedroom: 102
• 4 Bedroom: 113

Worcester has seen a development boom recently, but many new apartment buildings planned — as many as 3,000, according to city estimates — in the downtown and Canal District areas are either still under construction, or were delayed by the pandemic.

Housing costs are also linked to homelessness. Every $100 rise in median rent can result in a 9 percent rise in the local homelessness rate, a 2020 U.S. Government Accountability Office report found.

On the affordability front, the Worcester City Council recently passed a new inclusionary zoning law that will require developers in most cases to include affordable units in new buildings. Worcester has also minted a new Affordable Housing Trust Fund meant to assist developers who want to build affordable units.

Communities around Worcester will also have a role to play in the region's housing development. The new MBTA Communities law will require towns like Shrewsbury, Westborough, Northborough and Leicester to create zoning districts that allow for a certain amount of multifamily housing due to their proximity to transit stations.

Most smaller MBTA communities in Massachusetts have complied with the law so far, although Holden officials have taken issue with the law. State Attorney General Andrea Campbell has said she may take legal action against the handful of communities resisting the law.

CMHA, the main Worcester-area nonprofit overseeing the response to homelessness, says the city needs to do more, including rethinking zoning laws to allow more multifamily construction.

"Creating housing for households at the lowest income levels, keeping renters stably housed through rental assistance and tenant protection legislation are critical policy decisions we must implement," CMHA CEO Leah Bradley said in the news release. "We encourage the city and the surrounding towns to consider a policy of relaxing zoning restrictions to allow for more multifamily housing in high-opportunity neighborhoods, traditionally zoned for single-family homes, and to build the political will to combat 'not in my backyard' efforts."

You can read the Out of Reach report on Massachusetts here.