The Nantucket housing shuffle



It was a banner evening for the Penske brothers. According to reports from witnesses, after a night of drinking, Jay, the youngest son of automobile racing magnate Roger Penske, urinated on a woman passerby, bolted with his brother toward the Nantucket Yacht Club, broke into an employee apartment, then fled the scene before being apprehended by police. And just for good measure, while being arrested, he reportedly shouted racial epithets at the woman upon whom he had urinated. Less than 24 hours later, he was back in the adoring glow of the island’s nightlife, walking into the party of beautiful people in the newly opened, and extremely hip, Cru, where oysters, martinis, and frivolity mix with a pulsing vibe.

On the other side of the island, the Rev. Georgia Snell, president of the Nantucket Interfaith Council, which runs the food pantry and housing assistance program, attended to a completely different set of challenges. Each year, dozens of families go without housing, unable to pay summer rents, which spike when the population swells to five times its year-round number. Many of Nantucket’s residents must therefore rent on 10-month leases, becoming homeless over the summer. The problem is so pervasive, it sadly has a name: the Nantucket shuffle. For one single mother it meant sleeping in her car, while she sent one of her daughters to stay with her father, and the other to friends in Maine.

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Somewhere between the antics of the spoiled children of billionaires, and the plight of a mother struggling to provide for her family, lies the story of the island of Nantucket. How Nantucket went from an “ant-hill” of “naked . . . sea hermits,” as Herman Melville wrote in his epic novel set in the early 19th century, to one of America’s most expensive zip codes, was, in part, pure happenstance. But it was partly a matter of choice, too: In a backlash against development while seeking to preserve its historic identity, Nantucket enacted some of the toughest zoning rules in America which, over the past four decades, have had the effect of turning it into a community for the very rich.


Now, in the midst of another golden summer, Nantucket stands as the prime example of how excessive preservation can be just as much of a threat to local character as excessive development.


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Nantucket grew rich once before, as the capital of America’s whaling industry in the first half of the 19th century. But then its economy fell into decline, surpassed by nearby cities like New Bedford, which had access to the nation’s railroads as well as a more facile harbor. With the advent of kerosene, which made whale oil obsolete, the industry died, and with it Nantucket’s economic mainstay.

While other American cities were reinventing themselves, rebuilding their economies as well as their physical structures, Nantucket had no money to do so. This stagnation, however, would prove to be its greatest gift. From the grand homes of the ship owners who lived on Main Street, the whaling captains who lived on Orange, and the mates who lived in the lanes, the island was awash with the remarkable architecture of its heyday. If only by circumstance, the result was the largest collection of pre-Civil War homes in the country. That, and its pure maritime beauty, set the island known as the “Gray Lady” apart.

By the middle of the 20th century, Nantucket was becoming widely appreciated as a hidden gem. Among its enthusiasts was a man named Walter Beinecke. An heir to the S&H Green Stamp fortune, Beinecke turned his attention to the island in 1963, after having summered there as a child. His vision was bold, and he turned it immediately toward the waterfront — an area that had been mostly destroyed by a massive fire in the mid-19th century. He rebuilt the buildings and marinas, finally restoring what he called Nantucket’s “front-yard.”

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The former New York City resident’s ambition made him a controversial figure, but his success was undeniable, as Nantucket began its first renaissance since the days of whaling, more than a century before. In his 2004 obituary, which ran along the top of the front page of the Inquirer and Mirror, the island’s newspaper since 1821, his spirited point of view was on display: “I told people that instead of selling hot dogs to thousands of people, they’d be better off selling a steak and a bottle of wine. They’d make more money and handle a lot less bodies.” This hubris, and the fact that he owned the plurality of the island’s real estate, might have explained why some people walked the streets with buttons that read, “No Man Is an Island” and “Ban the B.”


But by then it was too late. Nantucket had been discovered, and the building boom was underway. In the first decade of construction, the number of building permits issued by the town increased by nearly 200 percent, with 1,836 of the permits going toward new dwellings, according to information provided by the Nantucket Historical Association. For this small town of less than 4,000 people, it was a lot of construction.

Too much, actually.


Like the swing of a pendulum, when change goes too far in one direction, it often results in a return the other way, a market correction of sorts. From Washington to Town Hall, for those who represented Nantucket, and the residents who elected them, market correction turned to panic.

In 1971, through a home-rule petition filed with the state Legislature, the town took the unusual step of landmarking the entire island, thereby turning construction approvals over to the Nantucket Historic District Commission, a body with omniscient authority. The Vineyard Gazette once described the commission’s regulatory practices as “life under the iron fist.” Its number-one goal, as listed in its 184-page design guideline manual, is to “preserve as unchanged as possible the old structures built before the middle of the 19th century in their original setting and conditions.”

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On one level they have succeeded. Nowhere is there a more pristine collection of buildings, streets, and sidewalks, meticulously laid out like a movie set. But towns are more than just a Potemkin collection of buildings, they also happen to be a collection of people. And in the effort to ensure that roofs are gabled, windows are period-designed, and shingles are white cedar, the town has chosen aesthetics over its underhoused residents.


To further mitigate the onslaught of construction, concerned residents started to buy up land to save in conservation. By 1973, the Nantucket Conservation Foundation owned about 14 percent of island land, with many of the contributions bequeathed by the estates of lifelong residents. In 1983, the town established the Nantucket County Land Bank, funded by a 2 percent transfer fee applied to real estate transactions. The accumulated funds are substantial — $15.8 million last year. The money is used to purchase island land and protect it from development. The law had two immediate effects — to make the construction of housing more expensive, and to make buildable land less available in the first place. Today, almost half the island is land bank protected and unavailable for housing.

And on two occasions, in 1981 and 1998, Town Meeting voters sought to ignore the laws of economics and passed measures to restrict the number of building permits issued in a given year. For the political set, passing laws and regulations is just something you do. But among economists, the opinion about regulatory schemes that limit or restrict growth is universal: It simply drives up the cost of housing. And did it ever.


Every year the Massachusetts Department of Revenue totals the property values within each municipality and adds it up. It’s called equalized valuations. Intuitively, Boston, with its commercial towers and dense construction, would rank number one on the list. And it does, at just under $110 billion. Next is Cambridge, then Newton. No surprises there. After that sits Nantucket. More than Worcester, the state’s second-largest city. More than Weston, the wealthiest suburb of Boston.

From the largest mansion to the tiniest salt box, housing on Nantucket is simply more expensive than elsewhere in the Commonwealth. The average price of housing is more than $350,000 higher than Martha’s Vineyard, according to online real estate database Zillow. The same data shows that in the last 18 years, Nantucket County’s housing prices grew faster than anywhere else in Massachusetts.

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And when housing prices rise, they attract owners with ever-higher annual salaries. Census data shows that Nantucketers earn almost $20,000 more than Vineyarders, and have nearly three times the rate of residents earning salaries over $200,000 per year. Homeowners not only tend to be more wealthy than their island neighbors to the west, but more likely to be white. The percentage of homes on the Vineyard owned by blacks is almost 60 percent more than the comparable rate on Nantucket, according to census data.


Policies have consequences. For the lifelong residents who rent on the island and the summer workers within the service industries that attend to the tourists, those consequences are real. Marianne Stanton, the publisher and editor of the Inquirer and Mirror, as well as a direct descendant of the Coffins and Folgers, surnames synonymous with Nantucket, remembered an incident outside her church one Sunday morning last year. A group of young summer workers from China had gathered, holding handmade signs asking for help to find a place to live.

Some of the larger and more responsible businesses on the island help their workers find housing, and in some cases have built their own. The kids outside the Methodist Church that morning were not among the lucky. “I wound up giving each of the kids 40 bucks instead of putting it in the plate,” Stanton recalled. “The town really has to do something.”

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Peter Morrison, a demographer who retired to the island from the RAND Corporation in California, agreed. He called the situation, “the most severe shortage of affordable housing you’ll find anywhere.” The present amount of affordable housing on Nantucket is 2.5 percent of the island’s housing stock — far below the state average of 9.2, and well below the Vineyard’s 5.2 percent, according to data from the Department of Housing and Community Development.

Yet for all the conservation and preservation efforts underway, little money is directed toward increasing the amount of affordable housing. A 1973 effort to add half a percent to the real estate transfer fee for the purposes of affordable housing was never signed by then-Governor Frank Sargent. And even though Nantucket became one of the first communities to adopt the Community Preservation Act — a tax levy of 3 percent that can be dedicated to affordable housing creation — its priorities remain stubbornly fixated on open space and historic preservation.

In 2013, the same year Reverend Snell was fielding desperate calls from soon-to-be-homeless Nantucketers, close to $1.8 million of the $2.3 million raised by the act went to historic preservation and open space. Only $320,000 was used for affordable housing, according to the town’s planning office.


Like the slow but gradual turn of a large ocean liner, Nantucketers are starting to recognize their challenge. In 2001, voters rejected attempts to extend the building cap until 2008. Voters decided “it was at best ineffective and harmed many of those it was intending to help,” according to coverage by the Inquirer and Mirror. Further, in 2006, a non-binding ballot initiative asked residents if they would support using public land to develop and manage housing: Forty-nine percent voted in favor, 45 percent against.

Planning Director Andrew Vorce sees an opening. Vorce’s first trip to the island was for his job interview. A community planner from Arlington, he was promoted to the top planning job in 2005. In that time he has been busy. In 2009, the town expanded housing opportunities in mixed-use developments, and in 2014 it allowed for six-unit buildings. Two affordable-housing projects that will ultimately create dozens of units are underway, even though one is stalled, and one had to contend with a lawsuit from neighbors. Still, he’s optimistic. As he sat around the conference table in his Fairgrounds Road office, drinking a coffee from the bakery next store, one couldn’t miss the enormous stack of files belonging to the Historic Commission awaiting approval. Glancing at the pile, he agreed that now might be the right time to liberalize some of the regulations that are holding the island back.

Until that happens, the Gray Lady tilts decidedly toward wealth.

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Mike Ross writes regularly for the Globe. Follow him on Twitter @MikeForBoston