Unbalanced Economic Expansion Affects Housing In Boston


Boston Housing (Photo Credit: Northeastern University)

BOSTON (WBZ-AM) -- It seems the greater Boston area is a victim of its own success.It’s not getting any easier to find a place to live in greater Boston and its certainly not getting cheaper.

Noted Northeastern economist Barry Bluestone reports in his annual greater Boston Housing Report card:

 “The reason why our housing problem continues to be so severe, is our economy is so strong. Unfortunately, we haven't kept up the pace of housing construction to meet that demand, “ he said.

 It should be a good problem to have, but it’s also not cheap to build:

 “Because our construction costs are very high...nationwide, we've had no improvement in housing construction productivity in 70 years,” he said.

 And the market forces take over:

 “As a result, demand outstrips supply and as a result, prices go up, rents go up,” Bluestone said.

 And what happens next is young families are being pushed away from Boston:

 “Workers who cannot afford the rents or prices in the Cambridge, Somerville, Boston area are moving to places like Lawrence, Lynn and Brockton.”

 And guess what? Prices go up in 'those' communities. But the problem, bluestone says reaches city and town halls:

“I think part of the problem is that it’s very difficult for developers to build housing for working families”

 It is the zoning laws:

“Communities have made it very difficult for developers to come in they go through long processes to try and get a zoning variance to build housing, particularly multi-family housing....and as a result, many developers just give up.”

But this time, Bluestone does not see an immediate market correction:

“I don't see us having another collapse in the housing market as we did in 2005 and 2006. That was an unusual experience.”

 Instead, bluestone suggests a lot of work needs to be done to create what he calls '21st century villages'--mixed use, multi family structures, ideally near public transit.

Listen to Jeff Brown New England Business reports at :25 minutes past the hour  on WBZ NewsRadio1030


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