Depressing: Boston-area housing costs still high

Every year, the Kitty and Michael Dukakis Center for Urban and Regional Policy at Northeastern University puts together the “Greater Boston Housing Report Card“. Every year, the results of the study validate what we all know to be true: it’s expensive to live in Boston and in Massachusetts.

Even after a two-year old recession has shaken our economy to the core, the cost of housing is still oppressive to many in and around Boston.

According to the report:

This recession has taken its toll on Massachusetts and the Greater Boston metropolitan area, but this time around the Commonwealth has fared better than many regions in the country. Job losses here since December 2007 [report was released before the third-quarter, 2009] amount to 3.2 percent of total employment compared to 4.8 percent nationally …

Home prices in Greater Boston have declined from their peak in September 2005, but the overall price slide has been 16 percent – half the rate for the 20 Case-Shiller metro areas combined. In some metro areas where speculative bubbles drove home prices sky-high (e.g. Las Vegas, Phoenix, and Miami), prices have fallen by 50 percent. In Greater Boston, prices have declined by little more than they did in the last housing cycle that began in 1988.

The relative burden of housing costs has lessened for many in the Greater Boston area, as the ratio of median selling price to median household income has dropped from 6.52 in 2005 to 5.42 in 2008. However, according ot the authors of the study, “in other measures, housing in Greater Boston has actually become less affordable than ever.”

… despite the recession’s impact on other prices, effective rents in Greater Boston continued to climb right through the beginning of 2009. Rents were 13 percent higher in the second quarter of 2009 than in early 2004, while median rental household income had hardly increased at all over this period …

… Boston is now tied with San Diego for second place in terms of monthly gross rent, trailing only San Francisco while being more expensive than Washington, D.C., New York, and San Francisco.

In the past few months, it seems as though rents have dropped throughout Greater Boston but perhaps not enough to make a significant difference to people’s pocketbooks.

Related posts:

1. Northeastern professor suggests new “stimulus” plan
2. Go, Boston! We’re #195!
3. Housing is cheap
4. Boston: We’re #4! – MA owners have high-level of equity in their homes
5. California ruling on affordable housing set asides may mean trouble in Boston