Crystal Cron separates beans, rice, onions and garlic in this March 2020 file photo. Cron's group, Presente Maine, buys food in bulk and distributes it to people living in affordable and low-income housing in Portland and Lewiston. Credit: Nick Schroeder / BDN

The housing shortage in and around Maine’s largest city is an economic and humanitarian issue that can be solved in part by changing zoning and spreading out costs to develop affordable housing, planners told businesspeople on Thursday.

Greater Portland is in critical need of more housing as the hot real estate market in the city pushes residents into the growing suburbs. The median price of single-family homes in Portland was above $479,000 in August, with suburbs including Scarborough and Cape Elizabeth at higher marks. High prices have also pushed out to fast-growing suburbs, including Westbrook, Gorham and Windham.

Portland and its seven surrounding communities have about 65,000 housing units, but that needs to be increased 10 percent by 2025, according to the Greater Portland Council of Governments. That is one of the council’s priorities, along with decreasing homelessness, with the cost to build more affordable housing spread across all area communities.

Much of the current hot market for new homes in greater Portland is for large homes with large lawns that few can afford, Kristina Egan, executive director of the council, told the Portland Regional Chamber of Commerce meeting.

“This is what our zoning laws are set up to encourage, and they discourage the kind of development that we’ve had as traditional New England villages and downtowns,” she said.

She and other planners have identified about 24 areas in various neighborhoods throughout greater Portland that have enough infrastructure to add affordable housing.

“Zoning is an issue,” Kevin Bunker, founder of the Developers Collaborative, which is developing the new homeless center in Portland, said. “Every town wants someone else to do affordable housing.”

A lot of zoning in the early 20th century was race-based, and even though the Supreme Court in 1917 struck down government-instituted racial segregation in residential areas, communities still are stratify housing by type and price, such as single-family zoning with large lots, Jeff Levine, interim director of the Maine Affordable Housing Coalition and the former planning director in Portland, said.

The current housing shortages date back to the early 1980s, when the U.S. Department of Housing and Urban Development’s budget was halved, Cullen Ryan, executive director of Community Housing for Maine, said. HUD’s budget was cut again in the early 2000s.

“We watched people jump into homelessness in the 1980s like we’ve never seen before,” Ryan said, adding that housing needs to be considered critical infrastructure.

People are healthier when they have a home, and providing services when they don’t is expensive. Housing someone in a shelter with support services in Portland runs $15,600 a year. If a person experiencing homelessness ends up in jail, it costs $47,000 a year, and those who are hospitalized cost up to $1,000 per day, Ryan said. The housing cost for a single adult in Portland is about $10,900 per year.

Portland and other parts of Maine can learn from proactive cities such as Minneapolis, which banned single-family housing zoning in every neighborhood in 2020, Levine said. He said a variety of housing is needed to give communities character, and that situation existed before zoning.

“Affordable housing is an asset, not a burden,” Levine said.