By William C. Shelton

(The opinions and views expressed in the commentaries and letters to the Editor of The Somerville Times belong solely to the authors and do not reflect the views or opinions of The Somerville Times, its staff or publishers)

It’s difficult to comprehend the speed and extent to which our beloved city is changing, while the people who built and made it so attractive are being priced out. And it’s difficult to convey how much impact instituting a transfer fee with revenues dedicated to permanently affordable housing could have on those conditions.

Starting with the first point, I could tell you that just since 2010, single-family home prices have increased 80%, and condo prices, 56%. Aggregating property types, Somerville’s price escalation appears to be the most intense in Eastern Massachusetts. But this doesn’t convey the magnitude of housing turnover or the human consequences.

I’ve discussed human consequences in earlier columns. Suffice it to say that they are traumatic and enduring for displaced families, and injurious to the fabric of community that those families’ departures unravel. As Mayor Curtatone suggested to the Boston Globe a couple of years ago, we are at risk of losing our soul.

To get a sense of the magnitude, you would need to be immersed in Somerville’s current housing market. Scott Hayman is. As Somerville Community Corporation’s Real Estate Director, he’s struggling to find reasonably priced units to buy as part of SCC’s 100 Affordable Homes joint venture with the City of Somerville.

Often before he awakens each morning, he has already received automated text messages notifying him of the day’s multiple listings, with follow-up texts from brokers on the ground and ready around the clock.  The market is moving so fast that even emails might take too long to bring a timely response.  When he visits an occupied property, the first words from the sellers’ broker are often about when the existing leases will expire, or that the occupants are tenants at-will, implying easy evictions.

Having considered hundreds of properties online, and visited almost fifty in person, he finds that competitive bids require making an offer within 24-to-72 hours. Successful bids are often above asking price and don’t include financing contingencies. Cash buyers have a significant advantage, backed by investors from far and wide, including outside the U.S.

Scott doesn’t waste much time on properties with strong potential for condo conversion. He knows that he will be outbid. He has looked at listings and discovered properties purchased only a month earlier by speculators who anticipate a quick $100,000 profit.

He says that, “While we debate and plan and design affordable housing policy, Somerville’s community as we know it is being sold out from under us.” He’s right. And we could see it coming twenty years ago.

That was the year that Massachusetts voted to abolish rent control. Subsequently, a number of reasonably well-off people whose tenure in Boston’s, Brookline’s, and Cambridge’s rent-controlled apartments had enabled them to accumulate savings chose to buy into Somerville. So the inflection point in regional housing price explosion came earlier here.

Mayor Michael Capuano appointed an Affordable Housing Task Force to recommend policy solutions. As a member of it, I suggested that maintaining Somerville’s economic diversity would require permanently removing a portion of our housing stock from the inflationary spiral, using deed restrictions. Since housing price inflation would far outpace operating cost inflation, units purchased at market rate would become affordable over time.

To finance this, I recommended an anti-speculation tax and a transfer fee. The former would be a capital gains tax on housing sales, graduated by how long the home is held. It would decline to zero over five years of ownership, and those whose personal circumstances forced them to sell would be exempt. But the largest source of financing would be a 1% transfer fee on the sale of real estate, as is already in place in Duke’s and Nantucket Counties, where the fee is twice that rate.

The Task Force was composed of disparate members with differing interests—tenants, landlords, real estate agents, a banker, housing advocates, and a recently elected Alderman Bill White. But by continually listening to each other and focusing on hard evidence rather than anecdotes, we came to consensus. We embraced these measures and many others in a December 1998 report.

But it was issued a month after Mayor Capuano was elected to Congress, and the transfer fee and the anti-speculation tax were never adopted. Although the other recommendations were eventually put in place, the transfer fee would have more impact than all of them combined, while having minimal negative consequences.

At today’s housing inflation rates, 1% is almost invisible to new buyers. Owners who are permanent residents would never pay it. And it is a tiny price for those who realize an unearned windfall by selling out and moving on.

Yet over the time since we first recommended it, a transfer fee would have contributed $80 million toward keeping a portion of our housing permanently affordable. And I don’t just mean affordable to our lowest-income households.

As David Gibbs explained in his excellent column in this space two week ago, households at every level up to and beyond the Boston area’s median income are struggling to pay Somerville housing prices. But income guidelines for most affordable housing programs exclude a majority of them. We’re at the point, for example, where municipal employees who don’t already own their own homes will be unable to afford living in the city in which they teach kids, fight fires, and maintain streets.

But wisely invested, transfer fee revenues could leverage many times their amount in capital invested in permanently affordable housing owned by a land trust, nonprofit organizations, or limited-equity cooperatives and private owners. And a good portion of funds so invested would eventually make its way back to a growing fund, producing hundreds of affordable units every year.

In his January inaugural address, Mayor Curtatone made a commitment to build 9,000 new housing units and institute a transfer fee as means of keeping Somerville a place where people like his immigrant parents can still afford to live.

Given market dynamics, building 9,000 new units would contribute little to that goal. But a transfer fee would accomplish more than everything else that we’re already doing.

Yet we have seen no such initiative from either of our city’s branches of government. I understand that Office of Strategic Planning and Community Development staff are busier than a one-legged man in an ass-kicking contest. Between managing a complete zoning overhaul, completing the Union Square Revitalization Plan, working on inclusionary zoning, fighting for the Green Line, and performing all their usual duties, they’re foregoing sleep.

But Somerville is foregoing $1 million every month that could support permanently affordable housing. Of the many issues currently under consideration, this one is perhaps the most important and urgent because of its potential influence on what we become as a community.