The Ills Of A Growing Economy
Boston is widely regarded as one of the most bustling cities to live in in the US. Some of the reasons for this are its unique blend of diversity and its rich history. The combination of these aspects endears itself to many people looking for apartments. However, it is becoming increasingly expensive to rent an apartment in Boston. Have you ever wondered why that is so and how people can counteract this phenomenon?
According to a recently study conducted by the local financial times, around 24% of the families living in Massachusetts are spending as much as 50% of their incomes on housing. This will come as no surprise to people living in Boston, as housing here is pretty much as expensive as it comes. The high prices mean that there are an increasing number of people who want to Rent Apartments in Boston instead of buying one, as it seems like a better economic decision than purchasing a property.
Historically, Boston has hardly been an ideal place for most people to live in. The outlook for the city was bleak until the late 1980s when things slowly started to look up. The level of major crimes plummeted while local banks and mutual fund companies grew. Colleges increased the number of students that they were enrolling and hospitals expanded. This created an influx of available jobs in both the medical and educational industries. As the population of Boston recovered economically there were negative repercussions such as the inflated housing prices. It has been estimated that the median price of houses in Boston jumped 203% between 2000 and 2010.
While some of the blame for the rising housing prices can be attributed to the increase in demand, there are other factors to consider as well. The citys population is 23% smaller than what it was 60 years ago. Over the years, apartments in the South End, Back Bay and Beacon Hill have been renovated to have fewer units per building. Also, a growing number of people are living alone and the average family size has decreased. Both of these things mean that the need for larger units has decreased. Additionally, since 2000, Boston's college student population has exploded with an estimated number of 67,000 students living in rental housing in the city. As such, this means that the increase in demand for apartment housing has not been contributing solely to inflated house prices.
During the past ten years, there has been a lot of construction in the city an estimated total of 20,000 new housing units have been added. But, a quarter of these were in low-income housing projects. Meanwhile, the citys population has increased by more than 28,000 people.
The current housing supply bottleneck and recession have done nothing but exacerbate the situation. According to a research study conducted by a professor at Northeastern University, this is mainly because of three reasons; the increase in the number of foreclosures, the bleak economic outlook and the ever increasing number of college students, graduate students in particular, who are now competing with other households for rental apartments.
All in all, housing prices in Boston are hardly expected to fall anytime soon. Though it is always ideal to have a strong economy, in Bostons case this would mean more people looking to move into the city which would further exacerbate the current situation.
by: Bruce Garland