PROVIDENCE, R.I. (WPRI) — When Ali Bramhall decided to leave Boston four years ago, apartments in Providence looked like a relative bargain.
“I thought it was a dream come true,” Bramhall recalled. “The rent was so much cheaper.”
Bramhall has recently been looking for a new place on the East Side of Providence — and these days it’s a different story. By early April she’d been searching for two months, only to find few units available and asking rents up by $400 to $500 a month compared with 2018.
“There is nothing out there,” she said.
Bramhall has plenty of company. Across Rhode Island, apartments are scarce and rents are soaring, making it harder than ever to find an affordable place to live.
Target 12 reviewed data from a half-dozen firms that track rents, all showing double-digit increases in the Providence metropolitan area. The real estate website Zillow shows rent for the typical apartment in the region was nearly $1,800 in March, up from just under $1,400 three years ago — a 24% increase since before the pandemic.
Another firm, CoStar, reports the apartment vacancy rate in the Providence area has fallen from 3.7% at the start of 2020 to 2.5% this past winter — half the national average.
“You have a lot of people vying for the same supply, and the supply is down,” said Mac MacDougall, a Realtor at Century 21 Butterman & Kryston Inc. who specializes in apartments in Providence and Pawtucket.
The experience of searching in a tight market leaves people frustrated and depressed, MacDougall said.
“I’ve had people say, ‘I don’t know what I’m going to do,'” he said.
MacDougall cited multiple factors helping to drive up rents. They include an increase in the number of people who want to live in Rhode Island following the pandemic, as well as the growing number of buildings being purchased by investors who then raise prices to cover the cost of their purchases.
Plus, some individuals who would like to buy a house are being boxed out of the market for single-family homes due to soaring prices and rising mortgage rates. Those individuals, who often have cash savings and strong credit, end up competing with long-term renters for the same supply of apartments.
Demand is so strong that MacDougall said in the past year he has occasionally asked competing would-be tenants to come back with their “highest and best” offers for how much they’d pay — something that usually only happens with home sales rather than apartments for rent.
The upshot? “Anyone that is making the $27,000 to $60,000 range, they’re hurting,” MacDougall said. “They can’t pay $1,600 for rent. I mean, that’s a lot of money.” But, he added, “I think this is the new normal.”
With competition tight, MacDougall said his best advice is for renters to build up their credit scores, with many landlords looking for tenants who have scores above 700. “That’s what people are asking for — a high credit score, a good income, and that’s what is going to make a difference in that person getting an apartment,” he said.
For middle- and lower-income Rhode Islanders, there is also the RentReliefRI program, funded with $352 million in federal money. U.S. Sen. Jack Reed championed the money during negotiations over pandemic relief bills.
RentReliefRI provides up to 18 months of assistance with rent payments, utility bills and other housing-related costs. As of Monday, the program had approved $177.6 million in aid, with another $70 million still being processed.
To qualify, renters need to earn no more than 80% of area median income, which is just under $62,000 for a two-person household. They also need to show evidence of housing instability — such as a past-due rent or utility bill, or a self-attestation form — and economic hardship related to the pandemic, such as losing a job or paying higher prices.
Officials are urging eligible individuals to apply to RentReliefRI soon, before the money runs out and applications are closed.
The high cost of housing has been a growing problem in Rhode Island for years. A study last year by HousingWorks RI, a research group at Roger Williams University, found there was only one community left in the state where the median tenant could rent affordably: Burrillville.
Experts say the long-term problem is easy to identify but hard to fix: for years Rhode Island has failed to build enough new housing to keep up with demand.
A 2016 study found Rhode Island would need to add as many as 40,000 new housing units over the next decade to keep up with the state’s changing demographics, far more than are currently being built. In fact, new housing construction in the state has never bounced back to its level before the Great Recession in the late 2000s.
The problem now has the attention of state leaders. Gov. Dan McKee has proposed spending $250 million in federal American Rescue Plan Act funding on housing initiatives, with $90 million of the money earmarked to develop new affordable housing. Some advocates have called for an even larger allocation of federal money to housing.
McKee has also appointed the state’s first “housing czar” — Josh Saal, a deputy secretary at the R.I. Executive Office of Commerce who is focused on addressing housing issues across government.
The R.I. House of Representatives has also prioritized housing policy under Speaker Joe Shekarchi. Two special commissions — one on land use, and another on low- and moderate-income housing — have been meeting for months to develop ideas for tackling the issue.
“It’s complicated, and I don’t mean to say that as a cop-out,” said state Rep. June Speakman, D-Warren, who is chairing the panel on low- and moderate-income housing. “It’s a very big problem.”
Speakman said there is no question Rhode Island is experiencing a housing crisis, pointing to data that shows half of residents are spending more than 30% of their income on shelter, with some even spending more than 50%.
Experts testifying before Speakman’s commission have cited a number of barriers to new development, including restrictive local zoning regulations, the high cost of land, a lack of affordable housing funding, and supply-chain issues for building materials.
“We’ve had proposals before our commission to build second floors on top of every CVS, Walgreens and other sort of strip malls around the state,” she said. “I don’t know who is going to do that, but it’s a great creative proposal.”
In addition to McKee’s proposed use of federal funding, lawmakers have put forward multiple bills during this General Assembly session that they say would help spur more development of lower-cost housing units. Others have suggested instituting rent control.
“I am hopeful that now that everyone is talking about it, there will actually be some action that follows the talk,” Speakman said.
Providence officials estimate there are currently about 880 new apartment units under construction in the city, including 246 units on the old Interstate 195 highway parcel at 80 Chestnut St. and 225 units at the former Wanskuck Mill on Branch Avenue. The recently announced proposal to redevelop the so-called “Superman” building downtown would also create an estimated 285 new apartments.
As for Ali Bramhall, she eventually adjusted her expectations and secured an East Side apartment that checked some but not all of her boxes. She moved in late last month.
“It’s not perfect, but it’s as close to perfect as I think I am going to get,” she said.
Ted Nesi (firstname.lastname@example.org) is a Target 12 investigative reporter and 12 News politics/business editor. He co-hosts Newsmakers and writes Nesi’s Notes on Saturdays. Connect with him on Twitter and Facebook