Home values in Boston are on the rise while commercial development in the city remains scorching-hot. Meanwhile, large metros areas around the country are experiencing a slowdown in property values.
Zillow’s Home Value Forecast (ZHVI) projects that Boston Metro homes will rise 2.9 percent while homes across the country will see their value rise by 3.8 percent between Q3 2013 and Q4 2014.
For Boston – already in the midst of a development boom – the projected rise in home values could add more fear to the minds of cash-strapped families concerned with a shortage in affordable housing.
Median home values for the Boston Metro area rose 10.2 percent year-over-year to the ZHVI of $343,200. Additionally, in the short-term, values jumped 3.3 percent from Q2 to Q3 and 0.5 percent from August to September, contrary to 18 of the 30 largest metro areas nationwide where home values fell or were flat.
While home values in 15 major metro areas across the country showed depreciation, Boston values continued to rise, albeit at a slower pace than prior months.
The breakdown of Boston counties year-over-year in September ZHVI is as follows:
- Suffolk County – $375,500 (up 14.4 percent)
- Essex County – $329,200 (up 12.2 percent)
- Middlesex County – $395,100 (up 10.4 percent)
- Norfolk County – $378,200 (up 10.3 percent)
- Plymouth County – $290,000 (up 6.7 percent)
Renters in the city and Boston Metro area won’t be getting a break either …
Boston Metro rents currently average $1,999 per month, having risen 2.9 percent annually. City rents have risen 6.6 percent annually, currently averaging $2,241.
Boston neighborhoods that have experienced the steepest annual climb in rent are:
- Brighton – 11.6 percent
- West Roxbury – 11 percent
- Hyde Park – 8.8 percent
- Roslindale – 8.2 percent
- East Boston – 8.1 percent
While a majority of the nation’s largest metro areas are in the midst of a housing value slowdown, Boston has yet to be significantly impacted and, in fact, continues to show appreciation.
Yesterday, the Boston Business Journal reported that Massachusetts currently ranks seventh in construction spending in the U.S. In total in 2012, the state spent $1.78 billion in industrial, warehouse and retail space, while supporting nearly 50,000 construction jobs.
With Boston’s favorable real estate market attracting new businesses and more commercial development (retail and office space), it appears that residential space in and around the city is becoming more attractive, or rather, more valuable.
Image from cities-of-the-world-photshelter.com
