Edit: I'm going to have to log off here for a bit. But since there are so many great questions I haven't been able to get yet, I'll be back later this evening to work through the rest. Thanks for all of the thoughtful discussion!

I've been at the Globe for the better part of two years, first on the metro desk before switching over to the business team, where I've written on a number of subjects, including Massachusetts' gun laws and the airline industry. Over the last six months, I've pivoted to covering Boston's intractable housing crisis. I write frequently about state and local housing policies, the housing market, and the region's supply shortage, focusing in particular on the suburban cities and towns that are loath to build. I'm also a renter in Boston, so I know all too well the struggle of living in a city where the market and overall housing affordability is shifting rapidly.

Proof: Here's my proof!

Comments: 205 • Responses: 12  • Date: 

Pariell171 karma

Something I hear fairly often but I've never seen substantiated with actual numbers is that the housing supply in Boston is being gobbled up by foreign investors. How much of Boston's as housing supply is being bought up by foreign investors? And what's the breakdown of which countries the foreign investors are from?

bostonglobe199 karma

We do hear this fairly often when talking about housing in Boston. The reason you've never seen any numbers substantiating those claims is because there is a distinct lack of data on this issue to tell us how significant the problem is. There are quite a few anecdotal examples in areas of the city like East Boston.

That said, there have been huge waves of foreign investment in local housing stock in Sun Belt cities like Tampa over the last two years. And in the 2010s, investors from China were really active in Boston's housing market. But the experts I've spoken to generally agree that foreign investment in housing here has cooled off substantially.

skateboard_pilot150 karma

Do you still rollerblade with Pete, Gab, and Jordy?

bostonglobe123 karma

Still a proud member of the Soul Skaters.

Wickedweed109 karma

How do we outlaw tenant responsibility for brokers fees?

bostonglobe116 karma

There was some movement on this under the Walsh Administration back in 2020, but it seems to have fizzled since. There are quite a few high-cost cities in the US that have managed to ban brokers fees, but it hasn't quite caught on in the Northeast. They were successfully banned in New York state back in 2020, but that ban was overturned by a state judge about a month later. They haven't taken up the issue since. To get brokers fees banned in Boston, most policymakers believe state legislation would be necessary.

Southport8441 karma

What changes do you think are needed to increase the housing supply in the Boston MSA?

bostonglobe161 karma

Ask any expert on this issue and they will tell you the same thing: loosen the state's zoning rules. Massachusetts has especially restrictive zoning laws because we leave the issue up to towns, many of which drafted their rules decades ago in an era when zoning was a tool for exclusion along racial and class lines and have hardly changed them since. That means we get a lot of single family homes, when the demand in our region is largely for multifamily housing.

The idea is that if the state takes some more control here, which it has the legal authority to do, and loosens local zoning rules to allow for more multifamily development, that will help the region's supply shortage.

That said, building market rate housing alone is not a solution. Even if we dramatically loosened zoning rules tomorrow, it would take years for the supply shortage to begin to ease. A lot of advocates and experts generally agree that, in order to keep more residents here in the short term, we need to pass stronger affordable housing laws, targeting folks in the income groups that our current affordable housing rules miss.

A lot of folks argue we also need more short term protections for tenants as well, though that's where experts and advocates are divided in opinion.

mehkindaok37 karma

Rent control never worked in the past but that's because it wasn't true rent control, we'll prove every single economist wrong and make it work this time, right?

bostonglobe50 karma

Will be interesting to see for the following reasons:

  1. I've been talking to a lot of landlords and developers about Wu's proposal, and it has been interesting to hear that most are in agreement that a rent cap of CPI + 6 percent (what Wu has proposed and the city council passed on to the Legislature last week), wouldn't be a huge pain point for property owners. They're more against the policy because they're worried about the rent cap going lower. If Wu's policy does pass, the city tells me a new Home Rule petition would be required if they ever did want to lower the cap.
  2. The other big piece of Wu's proposal to pay attention to is the 15-year exemption for new construction. Generally speaking, most developers can make back their money and then some in 15 years.
  3. There's already been a notable response from developers, including at least one of the big players in Boston who said they have paused any new development deals or inquiries until the rent control policy's fate is decided. If it passes, that developer pretty strongly implied to me that they'll leave Boston.

ShawshankExemption23 karma

Mayor Wu’s Rent Control proposal recently passed in City Hall, but requires a home rule petition to pass in the state legislature.

While normally home rule petitions are passed with ease given their nature, this one is much more significant to the Commonwealth, other municipalities, and state politics broadly.

What are the odds this home rule petition passes with no change to Wu’s plan? What are the current discussions/news on the prospects of this Home Rule petition?

bostonglobe21 karma

It is hard to predict what will happen with the Home Rule petition. Here's what I know. The Legislature has been skeptical of rent control in the past, but there is a lot more momentum among legislators for big action on housing this session, in part b/c Governor Healey has made housing a big priority. So they may be more open to considering rent control than they've been in the past, and the fact that Wu's proposal is relatively modest may help its luck. We'll know more in the next couple of months.

Monketsu22 karma

Is the Boston housing crisis actually a nation wide housing crisis? It feels like quite a few areas all over the country are experiencing similar issues.

bostonglobe27 karma

It certainly is a national problem, but it is driven by regional housing underproduction. The federal government leaves zoning up to state and local governments, which is why you see all of these pockets of underproduction across the US.

rainscadence18 karma

I’m a first time buyer that’s been looking at homes in the North Shore for the past 2 years - I’ve seen the price for an entry level move-in-ready home rise to ~$800k for 1.5k sqft with a min of 3 bedrooms.

While prices have cooled in other areas of the US due to rising interest rates, I haven’t seen prices drop in Greater Boston. The supply of new homes on the market has dropped substantially.

How do buyers justify these prices? Is their expectation that prices will continue to rise over the next 10 years due to limited supply and global warming making other areas more difficult to live in?

With the rise of remote work, I’d think it would be easier for more buyers to sprawl into cheaper markets.

bostonglobe23 karma

Unfortunately, the situation in Boston is such that prices don't really have much of anywhere to go in the long term but up. We've seen some really gradual price decreases over the last few months, but that has largely been the market correcting for the pace at which prices increased in 2021.

You're also seeing listings at high prices because the sellers who are willing to wade into the market right now may remember their neighbor selling their single-family for $900k last year, and want to get the same kind of return on their property.

russianpotato16 karma

Why would anyone ever sell a home with a 2.5% interest rate?

jezra16 karma

what percentage of the rentals in the area are owned by corporations?

mac_question22 karma

I don't understand this question, I assume the answer is 99.5%. If you had a lemonade stand up for longer than a couple days you might set up an LLC for it lol

I think you're asking "how many are mom&pop landlords which might possibly bring you cookies when they fix your heat two weeks too late, versus how many are faceless corporate entities which have property management companies because they might actually get sued at some point"

bostonglobe29 karma

This question is tricky to answer for the exact reason mac_question mentions above. There hasn't been a lot of substantive research done on the issue in Boston, partially because when one looks at a deed here that indicates a property is owned by an LLC, it is tricky to know whether that LLC was created by one person or by a big corporation.

Bronze-Soul7 karma

How do you see any of this ending? Or do you think this is the new normal?

bostonglobe14 karma

Hard to say. There's more and more political will to address the problem, and there are some US states that are having some success with boosting housing production. But it will take a sweeping effort that will probably be politically unpopular among suburbanites to dig out.

California is a good example of a state that is having some modest success. They have a significant housing crisis, but they're beginning to chip away at it with zoning reform. They've banned single-family zoning and are encouraging the construction of "missing middle" housing in suburban neighborhoods.

And I also have to point out their success with Accessory Dwelling Units. CA broadly legalized ADUs a few years ago, and have seen tens of thousands build across the state since. Massachusetts, on the other hand, lets municipalities decide whether or not to allow ADUS. We're lucky to see 100 built a year.

So there are some big tools that we aren't utilizing. It is perhaps a question of how long it will be until we are willing to use them.

russianpotato-3 karma

Why do you think people a feel the need to live in the same few square miles? Can't people live somewhere else? There just literally isn't enough space. Look at Hong Kong. More expensive than boston and they build housing like no tomorrow! Maybe not everyone gets to live exactly where they want.

bostonglobe28 karma

I'll just say this. Healthy cities need people across the income and job spectrums. If those folks can't afford to live here, not only do we risk brain drain --- losing the bright minds that power our state's education and tech sectors --- but we also lose out on a whole lot more. We'll lose the artists and creatives who make our city vibrant. And we'll lose the workers that power restaurants, convenience stores, etc. We need folks to do those jobs, and that can't happen unless they can afford to rent or buy a house here.