If you build it, will they come?

Last Updated on Thursday, October 11, 2012 10:17 pm Written by Cindy Nevitt Friday, October 12, 2012 01:00 am

“If you build it, they will come.”

So a voice whispered in “Field of Dreams,” the 1989 major motion picture that spawned the very catch phrase today being paraphrased by certain parties in Ocean City.

These parties believe that the mere act of building single-family homes will bring an influx of year-round residents to this island.

Silly boys. Just because you build it is no guarantee they will buy it, or occupy it, or live in it year-round. Just because you say it is affordable doesn’t make it so. And just because the city has previously permitted two single-family homes to be crammed onto one single-family lot is no excuse to do it again.

I speak of the quaintly named “coastal cottage” concept, which – in the name of creating “affordable single-family homes” – will double up on the number of structures allowed on a lot. Currently proposed for such a fate is the Coggins property in the 1200 block of Haven Avenue, and the role model for the concept is Tioga Terrace.

These six homes on Wovern Place are built so close to the road that there’s no room for grass to grow.

Never heard of Tioga Terrace, where homes face the alley that runs between Simpson and Bay avenues between 13th and 14th streets? How about Wovern Place, where tightly packed homes face a narrow, crooked alley that runs between 14th and West 15th streets bordered by Prospect and Pleasure avenues?

I’ll wait while you go have a look. I’ve included a photo of two homes on Tioga (1352 and 1354) that back up to two homes on Bay (1353 and 1355), and need just 8,658 square feet of space – or just under one-fifth of an acre – to do so. At that ratio, Ocean City can build 20 homes on one acre. You’ll be living so close to the house next door that you’ll be able to smell the sulfur when your neighbor lights a match.

These four homes, two facing Tioga Terrace and two facing Bay Avenue, combined are less than one-fifth of an acre of land. One home facing Bay Avenue can be identified by the back door glimpsed between 1354 Tioga and the detached garage next to it.

Council likes the concept

This is what three members of City Council are endorsing as the solution to Ocean City’s lack of families living year-round in town. I’ve seen less crowded sardines in cans.

Councilman Antwan McClellan, representing the 2nd Ward, has called the concept “just perfect.”

“Something like that is needed in that area of town,” he said.

Really, Antwan? Children playing in the parking lots of Piccini, Wawa and Sherwin Williams is what’s needed in that area of town?

I can assure you it most certainly is not.

I lived at 13th and Haven, across the street from where the proposed project would be located, in the mid- to late-1980s. I sold my condo and moved when I got married because I could not see myself raising children in a place where their playground would be equal parts asphalt, heavy traffic and flood water. Any parent who thinks this is a good place to raise a family needs a psychiatric evaluation. Any councilperson who thinks adding more people and more impervious coverage to a flood-prone, low-lying area needs a good dose of common sense. 

Councilman Tony Wilson, representing the 3rd Ward, has said his sister owns a home on Tioga, and that “she was darn happy to be able to afford a second home.”

Hello, Tony? The idea is to increase year-round residents, remember?

As a compromise to his first choice of single-family homes with garage apartments, Councilman-at-large Keith Hartzell is extolling the virtues of the two-homes-to-one-lot concept and said he’s as much in favor of absentee owners availing themselves of it as he is year-round residents.

“I love Tioga Terrace,” he said last week, minutes after he witnessed City Clerk Linda MacIntyre deny the Gazette’s Open Public Records Act request for copies of the “coastal cottage” drawings for the Coggins property on the grounds that: (1) such information is “non-releasable” because it was discussed in a Planning Board subcommittee meeting, where no minutes are kept and no information is made available to the public; (2)  it’s only a concept; and (3) the concept is proprietary to the architect, and releasing the drawings for public inspection could lead to theft of the idea.

First, let’s clear up the notion that the “coastal cottages” concept has only been whispered about behind closed doors. The subcommittee’s recommendation to allow single-family homes to be built on small lots – specifically on block 1207, lots 11-19.01 – was discussed before City Council on Sept. 27, at which time McClellan, Wilson and Hartzell all made positive comments in favor of the concept.

And let’s not labor under the misconception that the “coastal cottage’ concept, a plan that will put 2.5- to 3-story homes on half a lot, will be restricted to the Coggins property. At the Sept. 27 council meeting, Randy Schuele – the planner hired by the city to oversee the Master Plan re-exam, which will be voted upon on Oct. 17 – said the use also may be appropriate in other areas of the city.

Let’s also talk about the fear that someone could steal the architect’s idea to shoehorn two houses onto one lot. That concept has already been stolen by the very architect who is proposing duplicating Tioga Terrace on the Coggins property in the 1200 block of Haven.

In his failed attempt to sell me on the advantages of Tioga Terrace-like future development, Hartzell said the concept made single-family home ownership affordable, which is the same point he made at City Council’s Sept. 27 meeting. He named $400,000 as the proposed price of a “coastal cottage” and said that anyone with a good credit score making $75,000 annually would qualify for the mortgage on such a home at an interest rate of 1 to 2 percent. He further stated the monthly mortgage payment would be $1,200 to $1,300 a month plus property taxes.

What’s wrong with it

None of that sounded right to me, including Hartzell’s claim that there is more impervious ground coverage around one duplex than around two structures built on the same size lot. Stroll down Tioga and judge for yourself. The setbacks are so negligible that it’s hard to tell where the sidewalks end and the front yards begin.

While I appreciate Hartzell’s enthusiasm, I could not accept his facts at face value. So I did what he challenged me to do: My homework.

The selling prices of these so-called “affordable” single-family homes are more in the $475,000 to $550,000 range, according to those privy to the concept. There are no 1 percent or 2 percent mortgage interest rates available on planet Earth. A quick check of 30-year rates being advertised shows a low of 3.10 from Lending Tree and a high of 4.235 from Quicken Loans.

And what about the down payment, which at 20 percent would be anywhere from $80,000 (using Hartzell’s $400,000 figure) to $110,000 (using the insiders’ highest price of $550,000)? How long would it take the average wage earner in Ocean City, who collected an average salary of $46,386 in 2004, the most recent figure available from the 2010 U.S. Census, to save that much money?

Even if you bumped the number up to $66,481, the estimated median income in Ocean City in 2010 as reported by the most recent U.S. Census, how many years would it take to amass such a fortune?

So the average Ocean City resident isn’t pulling down 75 G’s a year. Doesn’t matter, because that’s not enough money anyway for these new affordable single-family homes. Don’t take my word for it. Listen to someone who is currently chasing the elusive dream of home ownership in Ocean City.

“The councilman's assessment gave us a good laugh,” said a college-educated, married woman who, with her husband and two elementary school-aged children, looked into buying a single-family home this summer. The couple, who asked not to be identified, work a combined 95 hours a week (two full-time jobs as white-collar professionals and two part-time jobs), earning almost twice as much as the $75,000 in annual salary that Hartzell said could support a $400,000 single-family home purchase. Yet they can only afford to rent, the wife said.

“Not only is $400,000 frankly not ‘affordable’ by our standards, $400,000 around here right now buys you a two bedroom or maybe, if you're lucky, a three-bedroom single that needs a lot of work, .i.e., too small for a family or a money pit that nobody will be able to afford to keep,” the wife said.

Even if the home were new, the math would not change. A $400,000 home, with a 20 percent down payment, would cost $1,700 a month with property taxes and insurance included, the wife said. At 10 percent down and an interest rate of 3 percent, a rate she called “a bit of a fallacy,” the monthly payment is closer to $2,000 a month.

Her figures are more in line with the 2010 U.S. Census, which reported median monthly owner costs for a unit with a mortgage in Ocean City as $2,226.

The woman said she and her husband, with a credit score of 750, could do no better than an interest rate of 4.85 percent this summer.

Concept not affordable or desirable to residents

Another factor affecting homes that come with stratospheric price tags are tighter lending guidelines for jumbo loans, the wife said.

“Once a home creeps up over the $421,000 mark, look out. How many young families with good credit – not bad, not excellent – aren't able to buy here because 80 percent to 90 percent of the single-family market is jumbo territory?” she asked.

In the end, she said she and her husband walked away from “a modest three-bedroom house with a small yard, five blocks from the beach” because the mid-$400,000 price tag, with 10 percent down payment, pushed their monthly payment to $2,700 with property taxes, insurance and PMI factored in.

“By this councilman's logic, all that should matter is what we can technically ‘afford’ now,” the wife said, adding the loss of any income in her household would jeopardize the couple’s ability to continue to make such a lofty mortgage payment. “He should take a good long look at the foreclosure crisis, and then maybe reassess his definition of what is and is not affordable.

“Basically, I think he is completely out of touch with what young families who want to buy in Ocean City are really up against. I know this, because we are living it. We have good salaries, good credit and solid employment ... and we're still renting.”

The 2010 Census does not report any rents higher than $1,999 a month in Ocean City, with the largest group of renters (1,535) paying between $700 and $749 a month. The second-largest group of renters (1,129) pays between $1,000 and $1,249 a month, and the third-largest group of renters (1,089) pays between $150 and $199 a month. In 2010, there were 839 renters in Ocean City paying between $1,500 and $1,999 a month, an amount that roughly approximates the mortgage payment on a $400,000 home that is purchased under ideal circumstances (20 percent down, 3 percent interest rate).  

As for the two-houses-on-one-lot concept ala Tioga Terrace, the wife said, “It sounds just like a condo to me except flipped on its side. The benefits of a single-family home for us, and why we're only looking to buy a single-family home, are two-fold: privacy, and a yard. Since this concept appears to have neither, it's not something we would pursue.”

So tell me again, councilmen: Who do you think is going to buy these homes?

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