Click through an interactive map to see the impact of teardowns, dubbed "new growth" by budget-makers, on Wellesley's tax revenue.

As Wellesley’s older, smaller homes are being torn down at a rate of more than 70 per year, the new homes that take their place are leaving an enlarged footprint both on the streets where they’re built and on the town’s balance sheet.

The impact on the town’s budget, according to officials at Town Hall, is likely less apparent than the visible change preservationists say the construction of the brand new homes has on Wellesley’s neighborhoods.

According to a Townsman analysis of the assessed values of homes torn down since 2011, those properties collectively contributed to approximately $2.5 million in growth to the town’s tax revenue in 2016 compared to the fiscal year prior to their demolition.

While refraining from passing judgment on the effect of teardowns on neighborhood character and aesthetics, town Treasurer/Collector Marc Waldman said that new home construction is financially beneficial for the town.

“You can just sort of envision a good bit of our new growth comes from teardowns because we’re certainly not building a lot of large new housing development tracts,” Waldman told the Townsman this week. “It’s not an insignificant amount; and it certainly has real budgetary impact.”

Executive Director Hans Larsen estimated the new growth contribution in the town’s annual budgets at $1.6 to $1.8 million, with a large portion of that attributable to teardowns.

Click on the map below to see a house-by-house breakdown of how property tax bills changed before and after the teardown process for homes torn down from 2012 to 2014.

According to data obtained by the Townsman, the 68 and 72 teardowns in 2012 and 2013, respectively yielded between $77 and $79 million in combined growth to the assessed values of those homes by 2016.

That same data revealed that tax bills for the 198 homes torn down and replaced from 2012-2014 jumped by an average of 145 percent.

“Obviously the core tax levy is going to go up 2.5 percent,” Waldman said, referring to the state law that enables towns to raise taxes each year, “but the new growth is kind of the gravy on top of that and when it’s strong it allows the ability to do more with the budget.”

According to Larsen, the increased revenue from the larger homes is beneficial to the town’s financial picture but far from a cornerstone of its operating budget.

“It doesn’t have a big impact,” he said. “Teardowns give rise to new growth, so some amount of our new growth each year is attributed to teardowns.”

The collective tax payments of the nearly 200 properties where a demolition occurred from 2012 to 2014 was just shy of $4.2 million for 2016, compared to $1.7 million in the years immediately preceding their demolition.

Those tax receipts amount to approximately 2.5 percent of the town’s operating budget for the coming year.

Delaying would have minimal long-term effect

Wellesley’s Historical Commission is working on crafting a demolition delay bylaw that, if passed at Town Meeting next year, would put it on par with each of its neighboring communities.

According to Tad Heuer, Chairman of the Commission, the goal of the bylaw is to slow down the pace of teardowns and preserve what he and other preservationists say is an unchecked overhaul of the character of Wellesley’s neighborhood streets.

“I don’t think anyone’s saying we want a moratorium on demolition permits,” Heuer told the Townsman earlier this month. “What we’re looking at is: people are saying the character of our neighborhoods” is being altered by teardowns and reconstruction of larger homes.

According to Waldman and Larsen, such a bylaw is unlikely to have a lasting effect on the town’s revenue from rebuilt homes.

“You might have a smaller growth for that year,” said Waldman, “but starting two years out you’re right back on that same schedule.”

Larsen agreed that the town’s budget-builders might notice a one-time impact on revenue generated by teardowns, but that it would likely rebound as long as the housing market remains strong.

“I think something like that could have sort of a one-time impact,” Larsen said. “But, I think over the long haul…the underlying economics of the marketplace will dictate the long-term outcome.”

‘Starter’ homes disappearing

Heuer, in discussions with the Townsman about the effort to impose demolition delay bylaw over the last several months, noted that he’s concerned that the effect that the teardown trend has on the number of houses available that are affordable for younger families.

According to an annual report published by Pinnacle Residential Properties, the number of homes sold for less than $1 million accounted for 20 percent of all home sales in 2014 and dropped 17 percent in 2015. It’s unclear how many of those homes were among the 95 torn down in 2015 or the 20-plus torn down so far in 2016.

That disappearance, he said, prevents many families from being able to move into town and also prices out many of the town workers who serve Wellesley on a daily basis.

“We clearly value our teachers, our police officers, our firefighters,” Heuer said. “These are people that we want to be in town all the time. We want them to know us, we want to be friendly with them…”

Of the 1,232 full-time town employees, only 106 live in town according to Larsen. That number drops to just 81 if teaching assistants that Larsen said are in all likelihood living with their parents are excluded.

Two builders in town -- Jim Mealey who restores one or two homes per year and Roger Kane who tears down and replaces 10-12 per year -- both said that restricting demolition permits could hurt the housing market and owners who are looking to sell.

“I think they’re trying to do some social engineering and calling it preserving character,” said Mealey, who added that he’s expressed the same thought directly to Heuer in conversations the two have had on the issue. “But, as population grows, prices are going up.”

According to Heuer, though, a diverse housing stock that enables people to move into town for less than $1 million would be an asset for Wellesley, especially if it meant town workers could stay in town when they’re not on the clock.

“I think it’ll be ideal if we can have more of those key workers live in the town they’re supporting,” Heuer said. “Jim calls it social engineering; I think it’s the way the town has always tried to accommodate…all income groups….”

Town Meeting turned down a similar proposed bylaw in 1991 as towns were beginning to adopt waiting periods. In 2016, nearly 150 Massachusetts communities have some form of law to stall teardowns.

‘You can’t legislate taste’

Even the strictest delay bylaws cannot prevent demolitions entirely.

Instead, they give town officials time to review a house’s historical significance and in some cases negotiate a plan to preserve the existing homes in full or in part, according to spokespersons from Wellesley’s neighboring communities.

Kane acknowledged that developers in towns and cities with delay bylaws—like Newton—sometimes rent out a home for a year in order to collect revenue and wait out the delay period.

He added that homeowners in delay-equipped towns have adopted the practice of beginning the demolition application process and then sell once the waiting period has ended.

Newton’s city council voted this week to amend the city’s demolition delay ordinance to require the delay period to restart if a property changes hands while it’s ongoing.

According to Mealey, the effort to delay demolitions ultimately won’t be fully effective.

“You can’t legislate taste, basically,” said Mealey, who added that he’s not a fan of many of the design of newer houses being built in Wellesley. “I think that’s what they’re trying to do.”

This the second part of an article on teardowns. The first part ran in last week’s Townsman. Ryan Fitzgerald contributed to the collection of data used in this story.