PORTLAND, Maine — A new report issued Tuesday by the city’s Planning and Urban Development staff states Portland’s 12 historic districts are not to blame for the current local housing crisis.
The report’s key findings conclude that while historic districts restrict certain kinds of development, median gross rent rates within their boundaries, though currently at historic highs, have grown at nearly identical rates as the rest of the city, since 1990. Also, the report found new districts didn’t contribute to displacement of current residents and the areas actually had much higher housing density per square mile than other parts of the city.
“There is not a noticeable increase in comparative home prices, rents or household incomes after historic district designation goes into effect,” the report said.
The 24-page report follows a two-and-a-half-year study by Washington, D.C. based economic development consulting firm John Stover and Associates with input from a local advisory group of eleven people with backgrounds in affordable housing, economic development, historic preservation, and sustainability.
It was commissioned at a cost of $84,973. Of that total, $20,000 came from a Maine Historic Preservation Commission. The study was commissioned in spring 2021, when the Portland City Council approved a 12th historic district, on Munjoy Hill. The final report was delayed due to the city switching consultants.
The report’s analysis was constructed with information gleaned from city building permit data, U.S. Census data, as well as scrutinizing the housing market, zoning regulations and land use contexts.
Portland’s other 11 historic districts cover parts of Congress Street, Deering Street, Diamond Cove, House Island, the How Houses on Danforth and Pleasant Streets, India Street, the Portland Company complex on Fore Street, the Old Port, the West End and the former Westbrook College on Stevens Avenue.
Every building inside each historic district is assigned one of three classifications, according to its preservation value. Alterations or additions to the structures come under different levels of scrutiny, depending on their historic ranking. Only the lowest ranked buildings may be demolished. New construction on undeveloped parcels within the districts are also subject to review.
A 2022 study found Maine’s shortage of new housing quadrupled over the previous seven years, with the vast majority of the shortfall in the greater Portland area. Maine was found to be approximately 9,000 units short in 2019, with 8,000 of those units missing from Portland and South Portland. But the new historic districts report maintains that the numerous designated areas, and their development restrictions, haven’t contributed to Portland’s dearth of affordable housing.
The report found the average annual growth rate of Portland home values after historic district designation was lower than before designation, dropping to 1.3 percent from 2.8 percent.
“Which may indicate that designation is more frequently a result of heightened interest in a neighborhood rather than a cause of it,” the report said.
The report also found Portland’s median gross rent rates between 1990 and 2020 grew at a rate of about 0.4 percent annually both inside and outside historic districts.
“In 2020, median gross rent rates were nearly the same in historic districts, [on] the peninsula, and citywide at around $1,200,” it said.
The report also found the median household income of historic district residents in 2020 was $53,201, which is below the city’s overall median household income of $61,695.
In addition to preserving historically significant buildings and neighborhoods, the report states the districts benefit the city in other ways, as well.
The increased rate of renovation within the districts, rather than demolition and new construction, lowered the use of building materials which reduced carbon emissions and reduced landfill use. The report said if demolition rates were the same in Portland’s historic district as elsewhere in the city, more than 11 million pounds of additional waste would end up in landfills each year.
The report ends with a caveat, stating that while historic district designation has not thus far contributed to the city’s overall unaffordability, that might not be the case in the future. Since 1990, Portland has had a relatively low rate of population growth but still experienced significant rises in rent and home prices, it concludes. Thus future demand for housing could put additional pressure on the static number of buildings within historic districts.
“And potentially lead to greater housing displacement, unaffordability and inequality,” the report said.
