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Not being an economist, I'm going on speculation here, but I think Cliff has hit on a big part of it. In densely populated areas, the demand for land is high. High demand = high prices.
Also, I'm going to guess that another factor may be that New England produces little or nothing in the way of raw materials that drive modern economies, and is in an out-of-the-way location up in a corner of the country. The fact that the region produces little in the way of raw materials means that everything has to be shipped in here after being manufactured, grown, or otherwise produced elsewhere. The region's somewhat remote location means that goods have to be shipped here in separate loads, special to this region. In regions which have routes between other locations passing through them, they can receive portions of bulk shipments passing through to several destinations. Everything here has to be shipped in special order, so to speak.
As for not needing a car, it depends on how often you like to get out away from the city. If you really like to spend a lot of weekends in the mountains, for example, you'll need a car. Even if you don't go in much for excursions, and would spend the vast majority of your time around the local environs of Boston and vicinity, be aware that there are plenty of suburban locations where it's difficult to get around without wheels. It is true, though, that compared to most of the U.S. the Boston area does offer more local spots where it's convenient to travel to nearby destinations by public transit, and where all the basic needs could conveniently be met without a car. You just need to search out those locations if you want to live car-free.
Some of these responses under this post are really wacky. New England does produce many raw materials. As a matter of fact, when Florida has one of those hurricanes that knock down their poorly made, cheap houses, much of the raw materials are shipped down there from here.
Boston is expensive because it is a very desirable place to live. Period. We have the best colleges/universities in the world, with an extremely varied economy; we are not dependent on anything, really. Route 128 is the nations technology highway, it is home to the mother companies that eventually spawned in Silicon Valley in CA.
Boston is beautiful, it is like the east coast San Francisco, but only better. It is also very progressive, which means people who live in other areas of the country that are non-progressive often prefer to live here. Incidentally, we look at some of these politicians around the country like Mitch McConnell, John Boehner, or Eric Cantor and and can't figure out how these people get elected.
Boston is expensive because it is a very desirable place to live. Period. We have the best colleges/universities in the world, with an extremely varied economy; we are not dependent on anything, really. Route 128 is the nations technology highway, it is home to the mother companies that eventually spawned in Silicon Valley in CA.
Boston is beautiful, it is like the east coast San Francisco, but only better. It is also very progressive, which means people who live in other areas of the country that are non-progressive often prefer to live here. Incidentally, we look at some of these politicians around the country like Mitch McConnell, John Boehner, or Eric Cantor and and can't figure out how these people get elected.
The boston area does not have that much of a tax base though. We are known for schools (tax exempt), hospitals (some are tax exempt), being more union friendly (unions are tax exempt). I wouldn't say we have a varied economy as businesses have closed.
Rt 128 being a technology highway implies too much. If what you are saying is true then why was there a silicon valley?
I'm not saying the place is bad but there just is not enough to really draw people to it. Don't get me wrong it has one of the best bar scenes in the country, the best sports scene on the planet and of course plenty of schools. But how long can you really go to school? What if you are bored of bars and don't like sports? Yeah there's the MFA and MoS but these tend not to change often. Of course there is medical care but when people come here for care they don't stay to live here. More importantly there are those that just became doctors that now have incentives from the federal government to work in areas that are impoverished as part of paying off student debt...they aren't staying here.
"It is also very progressive, which means people who live in other areas of the country that are non-progressive often prefer to live here."
Progressive meaning what? What can be found in Boston that cannot be found in other areas? Yes you can argue the sports but come on now a big screen hdtv can get a better view than the bleachers. You can watch events 24/7 anywhere on the planet..heck I saw the Celtics win halfway around the world in Shanghai!
Remember the blue laws? It wasn't until 1990 that retailers could open up on sundays..why not? Tattoos were illegal for 35 or so years due to one incident, liquor stores couldn't open on fridays until recently, fireworks are illegal even though they are are legal in over 45 states. Depending on the towns delivery of products and services is prevented on sundays due to trucking laws.
We paid billions for the big dig. They said it wouldn't leak a drop. Then leaks here and there..then a panel fell down. Heck Boston Harbor was kinda cleaned up...the wastes were pushed further out which is like a kid cleaning a room by putting everything under the bed.
If the place was desirable then why do so many leave? The cost of living means everything in here cost more. So why not just bank some money and move to where it is cheaper?
The population of Boston is 25% less than what it was in the 1950s it is now where it was in the early to mid 1970s. (ignore the church stuff)
The problem that the state has is we have many cities that were left behind. Industries left for other areas. Efficiencies of technologies have meant we do not need as many people as we once had (google only employs 20K people, twitter 300 etc) Eink corp out of cambridge was recently bought out by Prime View International out of Taiwan just as Lotus was bought out by IBM 16 years ago.
We can't use the argument that "It's different here" or "It's different now" because that is what gets us into bubbles.
I love the Boston area. However I also know that my partner and I won't be able to live here forever. We are both professionals in our late 20s/early 30s with excellent careers (and "good" salaries, for what it's worth) and advanced degrees, but we don't have the kind of family money or huge income ($250,000+ each) that apparently you need to comfortably buy something where we could raise a family AND have some sort of semblance of life near a city (without commuting 1+ hours each way by commuter rail or car traffic).
Sure, there are deals to be had - few and far between. But part of the real estate problem (or non-problem, depending on what side of the fence you're on ) I think is the tight rental market.
Having lived in New York, I think the Boston rental market is even harder than the Manhattan rental market.
What do I mean?
The quality of apartments in Boston is pretty low; they may be pretty charming, but even at some fairly competitive price-points, the housing stock is old, aging, and has not been kept up with.
Sure, in New York you can find apartments that rent for $50,000 a month and have their own elevators; Boston is not much different there. But in the $3,000-$4,000/month range you have a pretty decent set of options in a variety of neighborhoods for 1 bedrooms in New York. Even on the "higher-end" of rentals in Boston/Cambridge/Brookline (think $3000+/month), quality is by-and-large pretty low. No, I'm not talking about the fact that the apartments are old (Boston is an old city) - I am talking about pretty basic things. Does the stove hardly work because it's originally from the 70s? Is all the grouting messed-up in the bathroom? Is paint peeling from the ceiling (with no intentions of getting it fixed)? Are half of the room's radiators broken? I'm not kidding about any of these things.
I know some of these things are purely aesthetic (i.e. really crappy bathrooms) - but they speak to a larger point: because Boston has so many students and young professionals, I think owners/landlords/management companies don't feel a lot of pressure to maintain things well. They assume their tenants will treat the place pretty crappily OR they know that the market is so tight that there are oodles more people hungry for an apartment who will fork over the $$ just to find a place over their head.
I also know the cost of updating can be very pricy -- but I've been astounded at what I've seen in Boson in terms of quality (in a bad way).
The market is so tight - estimated at 6% vacancy this spring/summer - coupled with transportation inequalities among neighborhoods meaning that not all areas are "equal." We all know it's hard to find an apartment in New York -- I think it's even been a plotline for a movie or tv series -- but at the end of the day there are enough neighborhoods, buildings, and options, all with decent-enough public transportation, that you can find something. Except for someone with a ridiculously low budget or ridiculously complicated non-negotiable set of wishes (e.g. this street, this floor, allowing my five pet bulldogs, whatever), I don't know anyone who was unable to find an apartment, or several, within a few day's time.
On the other hand I know people who have searched for weeks for an apartment in Boston. Part of the problem is that not all areas of Boston are "equal" when it comes to public transportation. The T (subway) does not service all areas and it can be difficult and time-consuming to commute via bus AND T, especially in the winter. That wipes out a whole set of areas for young professionals who want to live in Boston in part because they like being car-less (e.g. me!).
The infrequency of the subway (and bus!) also adds to the problem. If the subway lines were more frequent and the buses were reliably on-schedule (I say this as someone who commutes to work via bus every single day and I have not, in the last 9 months, had the bus be on-time for my evening commute), it might be an easier pill to swallow. But it's not.
Add to this the strange distribution of services and shopping. If you want to live a carless life, you need to be able to walk to places that provide goods or services you need in your daily life and/or a way to transport goods/items/yourself at low-cost. This is going to sound weird, but I think the high taxi rates in Boston figure into this.
In New York you can find pretty much anything you need in your neighborhood - and if you couldn't, it was only a short subway ride, bus ride, or cab ride away. Cabs weren't cheap, but they were affordable when you really needed to use one.
I recently hailed a cab in Cambridge for a short ride (I was carrying something and had to go someplace not serviced well by public transportation) and my eyes about bugged out of my head when I realized that the initial mile is $5.55 and each subsequent mile is $3.60.
(For comparison, in New York, the "drop" (entry) fee is $2.50 and each subsequent fifth of a mile is 0.40, meaning that your first mile is the equivalent of of $4.50 and each subsequent mile is $2.00).
For a 4-mile cab fare from Cambridge to Boston you'd pay $16.35 (pre-tip).
For a 4-mile cab fare in NYC or its boroughs you'd pay $10.50 (pre-tip).
There are a lot of common management companies - and not much competition. I don't know of any set of companies in New York that manage a good proportion of the housing rental stock, with the exception of Stuy Town/Peter Cooper Village (which is a whole 'nother subject unto itself).
However in Boston there are maybe 10 rental companies that manage, proportionally, a large chunk of the rental market.
This lack of competition means that there is not a lot of pressure to offer things like discounts/specials/good service/competition among rates/rents. It also means that rents can be pretty much raised without impunity across the board (everybody's doing it!).
There just aren't a lot of options if you want to live in urban Boston (/Cambridge/Somerville/Brookline/JP) for the long-term. We "get" that Boston offers a lot culturally, intellectually, etc. That's why we live here. And why we love it.
But it's a hard pill to swallow to pay more than $40,000/year in rent (for no equity) - and it doesn't leave us a ton of room to save money to eventually buy.
I was at a wedding this past weekend with my closest friends. We all live in Boston and include 3 lawyers, 2 consultants, 3 teachers, a doctor, and a software developer. None of us can buy in Boston - and we would rather buy in Seattle, Portland, Atlanta, (what-have-you), than commute from Boxborough or Framingham or ___enter suburb name here____ (nothing against those places, but we like walkability).
I know exactly two people under the age of 45 who own in Boston/Cambridge/Brookline. They both bought their places for $1. Yes, from their parents (their parents bought them for them)!
So, to the poster talking about affordable housing -- we don't think we're entitled to own a place in Boston (we know we aren't) and we don't expect to be able to live here for the long-term. [I guess we could all rent for the rest of our lives, but I am not sure if that's the best financial strategy...] So we will all move eventually. But we're engaged, responsible, gainfully employed young professionals. We teach your kids, treat you at the hospital, solve local civic problems, and more. We all give freely of our time, energy, and resources to local non-profits and volunteer groups that help make this area what it is. We're the type of people who you and your neighbors want to live with and near.
Eventually something will have to "give." And I'm not sure what that is or what the solution may be. And I know it's not a problem unique to Boston -- it's a situation being replayed in San Francisco, New York, etc., in different ways.
For now, we'll continue to love Boston and continue to work to make our community a better place. Until we have to move one day. And I honestly think the loss of my generation of young professionals will be Boston's loss.
Rt 128 being a technology highway implies too much. If what you are saying is true then why was there a silicon valley?
At the time when the Silicon Valley was developing, the draw there was having the undeveloped space to build custom buildings for those startup companies at a very competitive price plus the nice weather of that part of CA and the presence of the talents coming out of the UC schools.
The weather of CA is a huge draw, and no one in this thread is claiming that MA is the very best state to live in over the rest of the 49 states. MA just works well for many of us. My family actually moved to CA, first to the Davis area, and now they are all in Berkeley. However, moving to be with them has zero appeal to me... except that my beloved cars would never rust. But that just isn't reason enough. I'm not even interested in taking my vacation time in CA, that's how much CA doesn't appeal to me.
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Sure, in New York you can find apartments that rent for $50,000 a month and have their own elevators; Boston is not much different there. But in the $3,000-$4,000/month rangeyou have a pretty decent set of options in a variety of neighborhoods for 1 bedrooms in New York.
Manhattan is where the pricey apartments are. For more affordable options, one has to become a "bridges and tunnel person" and seek residences in the boroughs such as Brooklyn, the Bronx, Queens and Flushing, and out of state to NJ and CT. The New York City that you are referring to occupies a much much larger area than Boston's metro area.
Not really relevant to this thread, but a friend of mine called from Miami beach recently. She said she was selling her condo for 31-2. I said "Wow! $312k is a lot for a condo". She said No: I'm SHORT selling it for $31,200!!! She's actually upgrading to a 2 bedroom, 2.5 bath townhouse w/ garage for $60k. I could buy a few condos in miami for what a downpayment costs here.
Note: The condo is in a safe area a few blocks from the beach. Taxes are $800/year and Assoc fees are $180/month. Crazy Cheap!!
Not really relevant to this thread, but a friend of mine called from Miami beach recently. She said she was selling her condo for 31-2. I said "Wow! $312k is a lot for a condo". She said No: I'm SHORT selling it for $31,200!!! She's actually upgrading to a 2 bedroom, 2.5 bath townhouse w/ garage for $60k. I could buy a few condos in miami for what a downpayment costs here.
Note: The condo is in a safe area a few blocks from the beach. Taxes are $800/year and Assoc fees are $180/month. Crazy Cheap!!
For more affordable options, one has to become a "bridges and tunnel person" and seek residences in the boroughs such as Brooklyn, the Bronx, Queens and Flushing, and out of state to NJ and CT. The New York City that you are referring to occupies a much much larger area than Boston's metro area.
I'm not saying this is going to happen now but I wouldn't be surprised if in the next 5 to maybe 10 years Boston will be more expensive than NYC.
Looking at the 25th, 50th and 75th percentiles it is getting close
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25th is only 5% more in NYC
50th is only 6% more than NYC
75th is 9.7% more
What's the reason? Well NYC's inventory numbers show they have increased I would say about 25%.
Boston on the other hand has dropped 25% (since 2006). The seasonal dips are also much more obvious on Boston..probably from the student populations that leave on winter break.
Boston and Massachusetts as a whole is not known for building new housing in massive amounts. Westwood station can be an exception but that's on hold. The process for building anything in Mass can be long and hard. Many towns still have open town meeting.
Infact if you state that you want to make an apartment complex instantly you are going to have to talk to everyone in town. Apartments mean more people which potentially means more students in classrooms. This means higher demand for teachers, bus drivers, staff etc. Towns try to forecast planning going forward a number of years and that would be like dropping a bomb on their lap.
Because there is so much expected from governments services in Mass any attempts to expand housing in large units (obviously housing is built.I'm talking actual complexes) are going to be resisted.
I'm not saying this is going to happen now but I wouldn't be surprised if in the next 5 to maybe 10 years Boston will be more expensive than NYC.
Well I don't think so. Manhattan has a certain appeal to the really wealthy and the celebrities that Boston will never have. We aren't ever going to get the Trump Towers phenomenon around our city. The real estate market has a way of sorting things out.
If gilwood's friend sold her condo in Miami for only $31.2K, then that's because no one was willing to pay more for it. And look at all the uber cheap real estate in Detroit. Cheap real estate is great, but it's not really a bargain if the amenities aren't there like good jobs and good schools for families. Life is just too short to waste time in places that are a compromise, just to save money. Also, right now, it probably makes more sense to rent than to buy.
Again though, there is no need to compete with other major US cities for popularity.
I might actually buy some "investment" property down there. It'll probably be worth it just for a place to stay for a few nights when I'm down there. Might even be worth it just to store my shoe laces there at that price.
Well I don't think so. Manhattan has a certain appeal to the really wealthy and the celebrities that Boston will never have. We aren't ever going to get the Trump Towers phenomenon around our city. The real estate market has a way of sorting things out.
If gilwood's friend sold her condo in Miami for only $31.2K, then that's because no one was willing to pay more for it. And look at all the uber cheap real estate in Detroit. Cheap real estate is great, but it's not really a bargain if the amenities aren't there like good jobs and good schools for families. Life is just too short to waste time in places that are a compromise, just to save money. Also, right now, it probably makes more sense to rent than to buy.
Again though, there is no need to compete with other major US cities for popularity.
Manhattan certainly will be expensive. But it is one of the five boroughs (Bronx, Queens, Staten Island (yes it counts too) and Brooklyn.
I am aware that Harlem is having a Renaissance.
But you do have to keep in mind is that celebrities often go to NYC due to rent controls. Cindy Lauper spends less than $900. Fox Business this morning reported another celebrity that spends $1000 for rent a month.
I'm not saying that Boston will go up but rather that NYC is going down.
I'm not putting NYC down but for the most part the whole planet is becoming more and more urban. 40 years ago when cable channels came out they'd target LA and NYC...now it's all online. 20-30 years ago when toys were tested in various markets they'd do the same..now it would be online.
What specifically can't a person get in a given area? Obviously food has spoilage but these days you can get anything. If someone wants to waste money they could get the South China Morning post delivered to them by air mail..
In the 20th century it made sense that NYC would be a draw..but now...
The UN isn't that big of a draw..if it closed it wouldn't mean that much. The sports scene isn't close to what boston has..same with the schools. Yeah central park is obviously bigger than bostons park but they aren't trying for the same thing. Sure wall st is bigger than most stock exchanges combined but how's the reputation for wall st today? Sure it's the largest tv market in the country but that was before cable/satellite.
They'll always be a desire to live there but unlike Boston they seem fine to build more housing units.
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) I think is the tight rental market.
