Greater Boston is experiencing a housing market rebound, but the lack of affordable housing could undermine the recovery, according to the Greater Boston Housing Report Card 2013.
Thomas Grillo
Real Estate Editor- Boston Business Journal
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The Boston area is in the midst of a housing-market rebound with rising home prices, increased production and a dramatic drop in foreclosures. But the lack of affordable housing could undermine the recovery, according to a new report by Northeastern University’s Dukakis Center for Urban and Regional Policy.
Penned by economist Barry Bluestone and his team at the center, the Greater Boston Housing Report Card 2013 said while housing affordability remains a major issue, especially for renters, a number of Bay State communities are using zoning changes and incentives provided by the state’s Chapter 40R legislation to create more affordable transit-oriented developments.
The report highlights reasons for optimism for a continued recovery in the region’s housing market. Housing sales are projected to hit their highest level since 2005 in Massachusetts this year, and condominium sales are expected to be at a level not seen since 2008. But it is the increase in building permits that underscores the market’s turnaround. Bluestone estimates more than 11,000 units will be permitted in 2013, nearly double the construction permits pulled just two years ago.
The growth in permits has been marked in the multifamily housing market, with more than 7,000 units permitted in 5-plus unit buildings this year, triple the number in 2011. Single-family housing, while growing, is doing so at a slower rate — up 38 percent from 2011.
Positive signs for the market may mask some of the challenges it faces moving forward, the report found. Boston remains one of the most expensive cities in the country for renters and homeowners. The report said that since 2005, the cost of living in Greater Boston has increased twice as fast as median homeowner household income and three times faster than the median income of renter households.
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