PROVINCETOWN — When Steven Rayl and Scott Presley purchased a gallery space at 352 Commercial St. with an attached apartment in 2017, they planned to rent out the one-bedroom unit seasonally to help cover the mortgage.
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“You can get a lot of money from people who just want to live here for four months of the year,” said Rayl, who lives in Dallas, Texas but has a second home here. “It always works out really well.”
Their winter tenant, Chase Hiffernan, was getting ready to move out when Provincetown started its “Lease to Locals” program, run by a Truckee, Calif. company called Placemate. Hiffernan told his landlords that the town would pay them $8,000 on top of his rent if they were willing to sign a one-year lease.
“Chase brought it to our attention, and it kind of went from there,” Rayl said.
The Lease to Locals program offers payments to landlords who choose to enter the town’s depleted year-round rental housing market. New one-year leases must be with “qualifying tenants,” which the town defines as people who work on the Outer Cape, are disabled, or are full-time Provincetown residents who volunteer, serve on a board, or participate in the town’s artistic life.
One qualifying tenant in a studio apartment earns the landlord a $6,000 payment, while two qualifying tenants in a two-bedroom unit earn a $16,000 payment. The program is capped at $20,000 for three qualifying tenants in a three-bedroom unit.
The town launched its program on April 1 with a $348,500 allocation from the town’s housing funds, which come from the rooms tax on stays in hotels and short-term rentals.
Hiffernan and his landlords were among the first to participate.
“I had been here six years and still had not secured year-round housing,” said Hiffernan, who opened two businesses last year, the Yoga Joint and Coyote Kayaks.
Like many locals, Hiffernan would move into larger apartments in the fall and move out again in spring, squeezing into tighter quarters with more people for the summer.
“Having my basic needs met, like a washer and dryer and a full-size kitchen, has allowed me to focus more on my businesses,” Hiffernan said
Bridging the Gap
Chase Janvrin, a general manager at Placemate, said that Lease to Locals is quick and cost-effective compared to most housing strategies. Nantucket was Placemate’s first contract on the East Coast, and Provincetown was the second.
“In some communities, the housing crisis is primarily driven by Airbnb units,” said Janvrin. “In others, it’s driven by vacant second homes.” In Provincetown, it’s both.
“We do an analysis to determine how much money people are making on Airbnb or what the carrying costs are for their second homes, and then identify how much the incentive has to be to bridge the gap to get them to break even,” Janvrin said.
Mackenzie Perry, Provincetown’s deputy housing director, said there are now 27 tenants living in 15 properties under the Lease to Locals program. Half the subsidy is paid when the lease is signed, and the other half is paid during the 11th month of the lease, which means the town has already paid $85,000 to new landlords and will pay $85,000 more next spring.
The town had about $1 million in unallocated housing funds at the last housing workshop in December 2023, and Perry said there are still funds available for more leases to be signed this fall.
Kevin Cronin and Glenn Hilburn, a couple from Atlanta who own a vacation home on Carnes Lane that they rent short-term, recently bought a three-bedroom home on Court Street where they hope to retire in a few years. Cronin said they had planned on renting it short-term to cover the mortgage until their realtor, Meg Stewart, told them about Lease to Locals and helped connect them to three tenants.
A few weeks later they became the first landlords to sign a lease through the program and received half of their $20,000 grant.
“It’s been a win-win,” said Cronin. “It’s been great to see them build a home, take care of the property, and truly enjoy the house we have.”
Carol Sherry inherited two properties in the East End from her parents and leased one of them to two tenants this spring through Lease to Locals. She is now considering renting the apartment that is attached to the house she is using as well.
“The incentive was crucial for being able to cover the bills and offer reasonable rent,” said Sherry, who works as a costume designer. She had been planning to rent the property short-term until she heard about the incentives, she said.
After One Year Ends
For now, the town is not offering an incentive for landlords to renew the year-round leases established through Lease to Locals.
Janvrin said that in other towns where Placemate operates, 50 to 70 percent of the landlords continue renting long-term even after their incentives expire.
“The initial incentive helps address property owners’ concerns about renting full-time,” Janvrin said. “Once they see that it works, they’re often willing to continue on their own.”
Rayl and Sherry both said that it would be difficult to keep renting year-round without the incentive, however.
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“I have a relatively low income, and I’m at the age where I should be retiring,” said Sherry. “That financial incentive was the deciding factor.”
Truckee, Calif., where the Lease to Locals program began, launched a “Rooted Renters” program in July that offers payments over a three-year period to help encourage longer tenancies. Initial payments are smaller than in Lease to Locals, but they increase over each of the following two years.
Provincetown Town Manager Alex Morse said that Provincetown is “actively looking into” the Rooted Renters program, but added that the town’s goal was to “spur new year-round rentals.”
Provincetown resident Bill Docker told the select board on May 13 that attrition of existing rentals was an issue. Docker and his husband have rented the studio apartment attached to their home for the last 30 years, he said.
“There are others out there who are getting squeezed and might have to take their affordable rentals off the market, leading to attrition,” said Docker. “What about the people who have been renting units for years?”
“We have limited resources, so if we included those who already rent year-round, we would run out of money,” Morse told the Independent.
Landlords who already rent year-round are eligible to take a residential tax exemption on their rental property every year, Morse said, adding that “we have made sure property owners are aware” of that tax advantage.