As spring moves into full swing, the season that traditionally generates the most home-buying interest can’t dissipate the clouds of limited inventory, rising prices and stubbornly high mortgage rates that conspire to perpetuate this state’s housing crisis.
And all signs point to a continuation of this untenable situation, which makes home ownership an unattainable goal for an increasing number of Massachusetts residents.
Unfortunately, the numbers don’t paint a pretty affordability picture, nor does the uncertain legislative fate of Gov. Maura Healey’s $4.1 billion housing bond bill.
Real estate analysts at The Warren Group reported yesterday that the median price of the state’s 2,563 single-family homes sold in March reached $580,000. That’s a new all-time high for that month and a 7.4% year-over-year increase.
At the same time, the number of houses sold last month was down, also by 7.4% percent.
Through March, single-family home sales in Massachusetts have declined by 2.8% compared to the same time period in 2023. But that didn’t prevent a 9.8% increase in the year-to-date median single-family home sale price, now at $560,000.
Condominium sales told the same story. March saw the fewest monthly sales since 2015 – a 5.9% decline – but the median condo sale price rose 10% to $550,000, a new all-time high for the month.
But these bleak statewide figures pale to numbers from the Greater Boston housing market.
There, the median price of a single-family home in March reached $900,000, according to figures released Tuesday by the Greater Boston Association of Realtors, more than a 9% year-over-year increase and a new March record.
And mortgage rates hovering around 7% just exacerbate an already discouraging real-estate environment, effectively pricing out even previously qualified buyers.
Producing more housing – the goal of both Healey and her predecessor – has yet to progress beyond the visioning stage.
The MBTA zoning law passed during Gov. Charlie Baker’s administration only requires communities that meet its criteria to create a multifamily zone, with market conditions dictating whether actual construction of housing ever occurs.
Healey has proposed a far more ambitious plan.
Last fall, the governor filed a five-year, $4.1 billion housing bond bill to kick-start the production of new housing.
But her bill, which her office stated in November would “unlock the creation of 40,000 new homes statewide,” has traveled a rocky road in the Legislature.
It was bounced this week to its third legislative panel.
The Committee on Bonding, Capital Expenditures, and State Assets reported Tuesday that the massive housing bond and policy bill should not pass, citing the rule that governs how long a committee can review a bill.
But instead of tabling the matter, House lawmakers opted to send the governor’s bill to the House Ways and Means Committee.
Legislation of the scope Healey envisions shouldn’t expect a rubber stamp, but a few of its detractors hit close to home.
As reported by the Boston Herald, Gerard Frechette, vice chair of Lowell’s Planning Board, testified earlier this month before the Joint Committee on Bonding, Capital Expenditures and State Assets that communities like his would suffer under some of the measures proposed.
“The overall goals are admirable and worthy of consideration,” he said, but a plan to lower the square-footage requirement to turn a single-family home into a multi-family dwelling would “have a detrimental effect on various areas” of Lowell.
“This wording will most likely encourage the conversion of some of the most affordable single-family homes for homeownership into investor-owned, two-family homes in many of the neighborhoods in the city,” he said. “Already, 58% of our housing stock is rental stock.”
Virginia Crocker Timmins, vice chair of the Chelmsford Select Board, expressed similar concerns for her town.
“It not only obliviates single-family housing zoning throughout the state, but it completely usurps the rights of each municipality to set criteria for this type of usage that’s tailored to that municipality,” she said.
And it appears House Speaker Ronald Mariano plans a substantial remodel of the governor’s bill.
Mariano said last month that he’s “going to go big” when the House takes up housing legislation, with plans to expand the governor’s $4.1 billion bill in several ways, including by proposing to extend the Mass. Water Resources Authority service territory.
The speaker signaled this move last month in his address before the Greater Boston Chamber of Commerce, which stressed the need to “unlock the full potential of the MWRA by expanding its area of service to provide clean water to future housing developments.”
Since October 2022, the MWRA has completed three feasibility studies, one of which addressed the potential of expanding the MWRA system in the Metro West area, which includes the area towns of Acton, Ayer, Bedford, Chelmsford, Concord, Groton, Littleton, and Westford.
Mariano’s MWRA expansion plan would take years – if not a decade – to produce any measurable housing, while likely complicating the already difficult path of a now rewritten Healey bonding bill.
All of which means this worsening housing crisis will further discourage homebuyers, and encourage more of our younger workforce to seek a more affordable location.