Boston Foundation Report: Housing Prices Continue to Soar
Housing prices in Greater Boston continue to rise, reflecting one of the tightest rental markets in the United States. According to a recent report by the Boston Foundation, the rental vacancy rate in Greater Boston has plummeted to just 3% in 2024. This figure is among the lowest recorded in major cities, surpassing New York and Washington, D.C.
Competitive Rental Market in Greater Boston
The sustained low vacancy rate indicates high demand for rental properties. Despite a slight increase in vacancies in some neighborhoods due to a drop in international students, overall trends show limited availability of rental units.
- 2024 Rental Vacancy Rate: 3% in Greater Boston
- Comparison with Major Cities: Lower than New York and Washington, D.C.
With the demand for rentals outpacing supply, rental prices have surged. Estimates indicate median rent varies between $2,400 and $3,500, placing Boston as the fifth-most expensive rental market in the country, trailing cities like San Francisco and New York.
Challenges in New Housing Construction
While there was a significant increase in new housing permits in 2021 and 2022, recent statistics paint a grim picture. By mid-2023, only 5,456 new homes had been permitted, marking a 44% decline from the same timeframe in 2021. This reduction poses a long-term risk as it suggests a future lag in new housing supply.
- New Housing Permits: 5,456 in 2023 (44% drop from 2021)
- Target: 222,000 new units by 2035, as set by the Healey administration
Escalating Home Prices
Home prices in Greater Boston have been on an upward trajectory for decades, exacerbated by the pandemic and rising interest rates. The increase in housing costs is notable across various communities, particularly where prices were previously lower.
- Brockton: Median sale price of a single-family home increased by 72% since 2015
- Lawrence: Home prices have more than doubled
- 36 cities: Median single-family home price now exceeds $1 million
Affordability has dramatically declined. In 2021, a home in the lowest third of the housing market cost approximately $399,554, requiring an annual income of about $98,000. By 2025, that cost is projected to rise to $505,319, necessitating an income of $162,224.
Impacts of Rising Housing Costs
The spiraling costs have significant consequences for renters and potential homeowners. Nearly half of all renters in Greater Boston are identified as cost-burdened, spending over 30% of their monthly income on rent. The disparity is more pronounced among minority households, with 56% of Black renter households and 52% of Latino households experiencing these financial pressures.
Increased Homelessness Rates
Homelessness in Greater Boston has surged, with 2024 witnessing the highest number of homeless residents in years. While there was a slight decrease in 2025, the rates remain elevated compared to pre-2023 levels. The crisis has disproportionately affected Black and Latino populations amid increasing international migration.
- Homelessness Rate (January 2024): 366 per 10,000 for Black residents
- 105 per 10,000 for Latino residents
- 21 per 10,000 for White residents
Future of Housing Reform
The MBTA Communities Act aims to facilitate more multifamily housing construction across Greater Boston. Yet, community resistance remains strong. The report highlights the importance of building coalitions to support housing development plans and suggests providing incentives for communities demonstrating effective housing strategies.
As the challenges of rising housing prices and a tight rental market continue, robust solutions are essential for improving the housing landscape in Greater Boston.
