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Downtown Affordability Within Reach?

As we prepare to usher in a new year, something rarely seen in today’s market is also upon us. The developer Related Beal has begun work on a downtown apartment building where EVERY unit will rent at BELOW-market rates. Downtown is prime real estate so this endeavor is very shocking as developers could get top dollar for such apartments. Their efforts are especially applauded as it called for a hefty $230 million budget. 

The Related Beal project offers a template for other developers to meet the city’s goal of building more housing that middle-income residents can afford. The 14-story building at Beverly and Causeway streets in the Bulfinch Triangle near North Station will house 239 apartments priced at rents affordable to low- and middle-income tenants.

About half the units are aimed at renters earning mid-range incomes — up to $78,800 for a two-person household — with the rest set at rents for lower incomes. A family of four that earns $78,800 a year, for example, could rent a two-bedroom apartment for $1,628 a month, in a neighborhood where similar new apartments could be twice that price. 

When you are doing good for the community, you have to be creative in recouping the financial loss. Related Beal designed the project to also include a 220-room hotel, to help offset the development costs and make it easier to charge lower rents. This is exciting because it demonstrates that developers can impact their community with a little creativity. Areas like Mattapan and Roxbury could greatly benefit from creative projects like this to boost the local economy, provide affordable housing and rid neighborhoods of abandoned buildings. 

Related Beal is writing a road map that could help other builders finance more affordable housing in Boston. The issue with our housing is that middle income renters suffer the most. Generally, they earn too much for heavily-subsidized apartments but can’t afford the high-end apartments that are quickly taking over.  

Construction will likely take about two years and possibly a record breaking influx of applications for the lottery. We will be following this history making project so sign up for our blog to stay current on the progress and to learn more about the Boston real estate market.

If you have any questions regarding renting one of your units, please CONTACT US TODAY at 617-297-8641 or Contact@MandrellCo.com! Our agents are trained to find you the best tenant that meets your requirements.

 

 

adapted from The Boston Globe

 

 

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Building Credit For Home Ownership

Due to the consistent rise in Hyde Park home values and subsequent rental costs, many people are starting to look more seriously at home ownership before they are priced out of their community. Understanding how credit plays a role in your ability to purchase a home is critical. If you do not have credit, then understanding how to build credit with a credit card can really be life changing. It’s an easy way to change your financial future.

You ideally want a card that reports to all 3 credit bureaus and you want to PAY IN FULL each month. If you are unable to do so, do not carry a balance greater than 10% of your card’s limit. The best way to accomplish this is live within your means: DO NOT BUY MORE THAN YOU CAN AFFORD. IF YOU CANNOT PAY OFF THE DEBT IN FULL, YOU CANNOT AFFORD THE PURCHASE! Paying off the card automatically each month is easy, with automated payment options and flexibility in selecting your due date, you should be able to pay in full each month or carry a minimal balance. You are not jumping through silly hoops trying to ‘hack’ the FICO system simply charge what you can pay for and go about your life.

Example: I charge my groceries to my credit card and when I get home, I pay off the bill. This allows my behavior to be reported to the credit bureaus (they hold the key to your financial future if you operate in the realm of credit). You want all 3 bureaus looking at your good credit habits (experian, transunion and equifax). By showing them your good habits, you will increase your credit score in a hurry.

There are 5 factors that go into a FICO score. The biggest 2 are payment history (35%) and amounts owed (30%). As you can see, it’s more important to pay on time than it is to owe a lot of money. Never take out debt to raise your credit score. That’s not a wise choice. That’s like spending money in hopes you can save money by getting a lower interest rate. Does. Not. Make. Sense. Go for the 35% and pay off your card each month. Being in good standing with your debt is the largest factor in your credit score.

At The Mandrell Company, we try to teach strong financial habits to increase home ownership in communities across Greater Boston. We specialize in teaching clients how to build wealth through real estate, and to get started, you need a good track record of strong financial decisions. To attend one of our free seminars, please register at Urban Money Matters or contact us directly at contact@mandrellco.com.

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New Development Project in Roslindale

The construction boom across the city benefits smaller but increasingly trendier neighborhoods as Roslindale. Potential homebuyers priced out of downtown and surrounding areas are beginning to appreciate Roslindale’s close proximity and accessibility to public transportation. Developers are taking notice. The latest development project approved by the BRA are new condos on Taft Hill Terrance.  

  • Total Project Cost: $4,000,000
  • Total SF: 15,353

Parkhead Development, LLC, led by Michael Indresano, received approval on plans to construct 19 condominium units off of Taft Hill Terrace in Roslindale. The project, designed by Embarc Studio, will contain two one-bedroom units, 15 two-bedroom units, and two three-bedroom units spread between two new buildings. Two of the units will be deed restricted as affordable housing, and the developer will make a $96,000 contribution to the City’s Inclusionary Development Fund to fulfill their obligations under the current policy.

The project will include bicycle storage and 19 on-site parking spaces for vehicles. Each condo owner will receive a $2,000 credit towards a car share account to encourage active transportation.

Source: Boston Redevelopment Authority 

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It is no surprise that the Boston Real Estate market is HOT! Luxury condo buildings are on the rise, as are rental prices and demand for housing. The Boston Inclusionary Development Policy hopes to keep a place in the city reserved for low and middle income families. 

Some affordable housing activists say changes to the policy is long over due as the last substantial update was in 2007.  Updates are set to take effect in January 2016. The new guidelines would require developers to construct a greater number of affordable housing units or pay more to opt out of on-site affordable units in many neighborhoods. The goal of these efforts is to help keep home ownership within reach for Boston low- and middle income families as current prices are not realistic for achieving home ownership. 

The new IDP shifts will take effect zone by zone. Roxbury, Dorchester, Hyde Park, Mattapan, Roslindale and West Roxbury comprise Zone C. The IDP team aims to encourage middle class housing construction here. There is no increase requirements for developers in Zone C as it is difficult to develop here currently. 

Currently. rental units must be affordable to those making up to 70% of the area median income, earning $62,000 for a family of three. The BRA will allow developers in Zone C, to provide units to those making 100% AMI, earning $88,650 for a family of three. This concerns community members as they believe this is still out of reach for residents of the community. Many believe this will make the area more affordable to those from outside these neighborhoods rather than incentivising community members to become homeowners or remain renters. 

We are sure this will continue to be a topic of discussion in the coming year as we (The Mandrell Company) strive to increase home ownership in these neighborhoods. We work with sellers of the community and also educate potential buyers on the home buying process and provide resources to help make it more affordable for them to own in their community. 

 

For more information on our upcoming home ownership and investing in multi-family seminars, please email us at contact@MandrellCo.com and we will provide an updated schedule of events for 2016. 

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