Lakes Region Community Developers Executive Director

Carmen Lorentz

‘The difficulties that first-time buyers face has nothing to do with unrealistic expectations. It’s simple economics – supply and demand,’ says Carmen Lorentz of Lakes Region Community Developers. (Photo by Allegra Boverman)

Carmen Lorentz is executive director of Lakes Region Community Developers, a housing and community development nonprofit based in Laconia with a $60 million portfolio of affordable rental housing.

She started the job in 2017, after serving as director of the state’s Division of Economic Development.

Under her leadership, the organization has been diversifying its real estate development activities to include developing affordable starter homes, supportive housing and affordable commercial space for local nonprofits serving critical needs in the region.

Q. How has the shrinking inventory and rising cost of housing affected Lakes Region Community Developers’ capacity to maintain and develop its portfolio of properties priced within the means of working families?

A. We have 366 apartments in six different towns. Our vacancy rates are the lowest they have ever been, and during Covid-19, turnover has been much lower than normal. This helps us maintain our portfolio. So, low vacancy and low turnover is good from the perspective of operating our properties.

When it comes to developing new housing, the tighter market makes it more difficult to find a site that is the right size, has all the infrastructure we need and that is affordable. When you’re developing a rental project, you know how much acquisition cost per unit your project can accommodate. Most of the time, there is very little wiggle room.

Q. What challenges has the agency encountered in its efforts to diversify its portfolio by developing starter homes? Do first-time homebuyers expect more of a starter home than its cost can provide?

A. The difficulties that first-time buyers face has nothing to do with unrealistic expectations.

It’s simple economics — supply and demand. Freddie Mac estimates that we need 3.8 million more housing units nationwide. New Hampshire Housing Finance Authority estimates we need 20,000 more housing units in New Hampshire. We are in a huge hole, and the only way out is to build more entry-level homes. In order to do that, we need public investments in water and sewer infrastructure and changes in zoning to allow higher-density development in appropriate areas.

Without those two pieces, it’s difficult, if not impossible, for developers to build entry-level homes that people who live and work here can afford.

We have been working on a development of 20 entry-level homes in Wolfeboro for a few years. We hope to break ground this summer. The only reason we even attempted this project in Wolfeboro is due to our strong partnership with Eastern Lakes Region Housing Coalition, which owns the land and is selling it to us for a very low price. We also secured $540,000 in state and federal grant funding to help offset the cost of the road, water and sewer infrastructure. We really could use more subsidy on the infrastructure, but there are no funding sources for this in New Hampshire.

Q. How should housing policies balance meeting the needs of an aging population with ensuring the growth of a younger workforce?

A. The myth that workforce housing creates a burden on elderly homeowners has been debunked, and we need to move past it. As a landlord, we pay property taxes on all our properties. We pay $350,000 in property taxes every year — $150,000 per year just to the City of Laconia! Our tenants are a diverse mix of single people, couples with no kids, families with children and elderly people. When you average it all out, our tenants pay for the public services they use and do not create a burden on elderly homeowners.

An aging population needs young workers. Young workers need housing they can afford. If we don’t build housing for young workers, our aging population will find it more and more difficult to access the services they need to thrive.

Q. How does the high proportion of seasonal homes in the Lakes Region weigh on the supply of affordable housing in the region?

A. For many people, a second home can be smaller than their primary residence, and it doesn’t need to be on the water. This is exactly what most first-time buyers can afford. So there is direct competition between first-time buyers and secondhome buyers. Most of the time, the second-home buyer with higher net assets and more cash is going to get the house.

Many second homes are used as shortterm rentals now, making even more homes unattainable for local first-time buyers. This keeps first-time buyers in the rental market longer, which puts increased pressure on the supply of rental units, making it harder for year-round renters to find a place they can afford.

We have this very strange situation where we’ve got lots of empty houses and condos and lots of local people who can’t find anywhere to live. This is one reason we need to build more workforce housing and entry-level homes that are incomerestricted.