The skyrocketing price of housing is keeping home ownership out of reach for millennials in Massachusetts — a “huge obstacle” on the path toward achieving the American dream, particularly for those in the Boston area where housing prices are among the highest in the nation.
The median home sale price in Massachusetts has hit a new threshold — $400,000. In Suffolk County, it’s $570,500, according to a report Wednesday from The Warren Group. The year-to-date median home sale price statewide rose 3.2 percent compared to the same nine-month period in 2018. And even though the number of sales dropped this year in 10 of the state’s 13 counties, prices are still up across the board, according to the report.
“It’s forcing young people to spend an incredibly high percentage of their income on housing and affecting all sorts of lifecycle decisions: decreased fertility, delayed retirement, employment decisions,” said Boston University Professor Katherine Levine Einstein, who studies housing policy in Boston. “It’s a huge obstacle.”
A family would need to earn around $160,000 per year to qualify the median home in Suffolk County, according to data from the National Housing Conference — well over the $90,650 household income of the average two-person household in the Boston area.
Rose Grenier said she and her boyfriend, who live in Watertown, are looking to buy for the first time — but they might have to go as far as Fitchburg.
“Out there it’s still not cheap, but you at least get something for your money,” Grenier said.
She said she and her boyfriend between them make nearly six figures — which, to her, seems like a lot.
“But that’s like nothing here,” she said.
And Grenier isn’t alone — of the fastest growing jobs in Massachusetts, only one profession pays anywhere close to the salary needed to buy the average home in the Boston area: nurse practitioners, who earn about $122,000 a year, according to the U.S. Department of Labor.
Home health aides — the state’s single fastest-growing job — only earn about $30,000 per year.
Housing is only considered affordable when costs are at or below 30 percent of a household’s income, according to the federal definition.
Einstein and other housing experts blame the region’s exploding home prices on several factors: a lack of available housing supply, the cost of constructing more homes and insufficient federal funding for subsidized housing.
Boston and the 20 other metro cities and towns have seen 42,131 new homes and apartments built since 2011, but most of those have been high-end, luxury units that sit at the top of the market.
“Let’s start building housing for the people for the people who actually live here,” Karen Chen of the Chinese Progressive Association told the Herald in a recent interview.
The state needs at least 135,000 new housing units to quell the region’s housing shortage, experts say. But so far the Legislature has failed to act on a series of bills by Gov. Charlie Baker that would cut the red tape and make it easier for developers to build the kind of high-density, multi-family housing that experts say will help finally drive costs down.
Until then, realtors say many families will have to look far outside the city to find homes they can afford.
Larry Rideout of Gibson Sotheby’s International Realty told the Herald he often directs hopeful homeowners out of Boston because of prices.
“You might not be able to do the Boston marketplace — you might be able to do the Medford marketplace. Maybe you can afford the South Shore marketplace — they’re all nice, too,” Rideout said. “Boston may not be possible for many people.”
