10 Facts About Boston’s Housing Market You Probably Didn’t Know

The Boston Foundation put together a housing report card that addresses supply, demand, and the challenge of local control. These reports generate tremendous interest on the part of housing advocates, economists, policy makers—and the community in general—because they not only present and analyze an enormous amount of data, they also suggest new ways of considering the challenges we face—and they point us in the direction of solutions. This report is no exception.

It looks closely at the Commonwealth’s practice of local control, otherwise known as “home rule,” regarding land use regulation—and it raises concerns about the challenges that system poses. First and foremost among them is an apparent unwillingness on the part of many cities and towns to participate in developing the diversity of housing we need for our region’s growing population. The vast majority of new housing production remains concentrated in a small number of cities and towns. It also points out that people of color are still highly concentrated in a few places, often in poorer neighborhoods, even if residents themselves aren’t poor. Generations of institutionalized racism have entrenched segregation and—even though the law prevents outright discrimination— established patterns and home rule have only maintained the status quo.

This report calls for a multi-pronged approach to these challenges—from legislation and public policy to education and technical support—to counter the inertia that can come with home rule and the legacy of generations of discriminatory practices. Cities and towns outside of Boston have the capacity to play a crucial role in solving our housing problem, but so far they are not delivering. The data here will help as we move forward, but we also have to summon the political will to achieve real change in housing practices.

Housing is, very simply, a human right. Most Americans believe this, but in order to provide that right to everyone, especially to low-income residents and people of color, all of the cities and towns circling in Boston’s bright orbit—and benefiting from its growing reputation—need to step up and do their part.

Sharing these 10 facts about Boston’s housing market you probably didn’t know is one of many ways we are committed to doing ours.


Massachusetts as a whole is a relatively diverse state. It has the third highest percentage of people identifying as LGBTQ+, at 5.4%. Massachusetts is also home to eight different religious affiliations that are observed by at least 3% of the state’s population (including non-practicing and agnosticism). Though these specific groups do not necessarily have different housing needs, the diversity they represent speaks to Greater Boston’s ability to create space for and welcome people of different affiliations and perspectives.

While the region is becoming more diverse, racial segregation remains a persistent challenge. More than 70% of the region’s Latino households and 66% of black households resided in just 10 municipalities in 2017 and Boston remains one of the most segregated of the nation’s 50 largest metropolitan areas.


Social science research has clearly demonstrated that neighborhood conditions play an important role in the life outcomes of residents, particularly youth. Youth from historically underrepresented racial and ethnic groups disproportionately live in neighborhoods with few job opportunities, lower performing schools, and high levels of crime that negatively affect their outcomes later in life (Chetty et al. 2016). Moreover, striking racial differences in the likelihood of upward mobility demonstrate that escaping childhood poverty appears to be more difficult for non-white youth (Corcoran and Matsudaira 2005; Isaacs 2007; Kearney 2006; Mazumder, 2005).

Neighborhood segregation by race, ethnicity, and socioeconomic status creates physical and social barriers for youth seeking access to employment, postsecondary education, and community engagement (Hardaway and Mcloyd 2009). Low-income and non-white children are most likely to succeed in places that have less concentrated poverty, less income inequality, better schools, a larger share of two-parent families, and lower crime rates, with boys having especially poor outcomes in highly segregated areas (Chetty and Hendren 2015). By decreasing access to opportunity, segregation serves to exacerbate inequality across racial and ethnic groups.


Over the past decade, the number of homeless families in Greater Boston increased by 27% and the number of homeless individuals by 45%, with a spike in 2018 driven by an influx of displaced residents of Puerto Rico.


Research shows that part of the increase in income inequality over the past several decades stems from wage polarization, where the middle of the income distribution has been hollowed out. Between 1990 and 2014, the number of middle-income working households in the Boston metropolitan area fell while the number of low-income and high-income households grew.

Income inequality can exacerbate a region’s housing affordability problems. Higher income households will always be able to outbid lower income residents. If production is not able to keep pace with demand, then middle-income households will struggle to find affordable options on the market, and low-income households may be pushed out of the market altogether.


In 1966, Massachusetts approved “home rule,” which allows municipalities to determine their own zoning and housing policy. While providing municipal governments with the flexibility to meet unique housing needs within their own community, home rule does not provide an avenue for desegregating Greater Boston. Within the current home-rule setting, the Commonwealth is somewhat limited in the interventions it can take to mitigate segregation, thus allowing primarily white communities to remain as such. The State could consider changes to the home-rule policy to better deal with broader regional and statewide housing needs. Such an attempt could help to limit elements of racial and income segregation that are codified through municipal level policy.


Among policies that might move the needle to improve equity in housing access is the development and expansion of state housing finance programs that promote upward mobility, (e.g., mortgage products targeting historically underserved borrowers) and construction of affordable housing in all types of communities. Another is strong enforcement of state and federal fair housing and antidiscrimination laws. We encourage the state attorney general to review and address potentially discriminatory rules or practices.

To address the affordable housing shortage, devoting additional federal and state resources to housing development and low-income rental assistance is critical—as is making the best use of existing resources. Inclusionary zoning has worked in Boston and Cambridge and should be extended to other cities and towns where economically feasible.


Many inner core communities (including Boston, Cambridge, and Somerville) have struggled in recent years to determine what percentage of below-market rate housing units is achievable without making development economically infeasible. There is a balancing act between requiring too much affordability, which can deter developments in weaker markets, and failing to achieve the higher levels of affordability that hotter markets can support. Economic feasibility can also be enhanced by allowing greater density for developments with affordable units than zoning would otherwise allow. Additional data about inclusionary zoning policies in Massachusetts will be available in 2020 through MHP’s work with the Grounded Solutions Network, a national nonprofit organization coordinating inclusionary zoning policy efforts from across the country.


In Massachusetts, we have seen some positive steps toward residential integration through state level housing policy, namely the development of Chapter 40B and Chapter 40R regulations. Chapter 40B is an affordable housing law that stipulates that every Massachusetts community maintain at least 100% of its housing stock as affordable (reserved for families earning no more than 80% of the area’s median income). Chapter 40R encourages communities to create “smart growth” zoning districts and dense residential zoning districts located near public transportation stations or within walking distance of town centers. These two residential zoning laws serve to reverse damage caused by discriminatory federal and local housing policies that previously excluded black and Latino residents from homeownership in desirable communities.


This year’s Greater Boston Housing Report Card points to three persistent challenges that the region has faced over the past several decades: insufficient housing supply, lack of housing affordability, and inequity in access to housing with its attendant racial and socioeconomic segregation. Massachusetts is one of few states where most land use decisions are made by municipal governments without regional, county, or state oversight. In this environment, it is no surprise that insufficient housing supply reflects how little land is zoned to allow for the development of new housing—particularly multifamily housing, which is often disfavored by local residents, especially where it is not the current norm. Although multifamily housing production has rebounded since the recession, it is still well below historic levels, falls short of current demand, and is heavily concentrated in just a handful of communities—primarily Boston, Cambridge, and Somerville. While most new housing being produced in Greater Boston is at price levels that are not affordable to low- or moderate-income (LMI) households, additional supply at least expands the overall stock of housing and can help slow the inflation of rents and home prices across the market.


Two public policy interventions have potential to break patterns of segregation. First is the development and expansion of state housing finance programs that promote upward mobility, such as mortgage products that target historically underserved borrowers and construction of affordable housing in all types of communities. A good example is the Commonwealth’s ONE Mortgage Program, which was developed in response to racial discrimination in mortgage lending and has enabled more than ten thousand low-income households of color to become successful homeowners. Broader state financing initiatives to promote racial equity in mortgage lending are currently underway. The second is strong enforcement of state and federal fair housing and anti-discrimination laws that go beyond the letter of the law to capture its broader social goals. It is not unusual for communities to make permitting decisions or to propose zoning amendments that effectively prohibit rental housing for families with children, which also has the effect of exclusion by income and race. Developers and local officials may also talk “in code” about their intentions to develop housing that will not attract people with different racial or ethnic characteristics than current residents.

We encourage the Commonwealth’s Attorney General to use her existing authority to: (1) diligently review proposed zoning changes for potentially discriminatory effects; and, (2) forcefully address permitting decisions that are explicitly biased against rental housing for families with children. Nonprofit legal advocacy is also critical to ensure that federal and state fair housing laws are being thoughtfully and vigorously enforced.

For most of the last century Greater Boston has been a national leader in addressing the housing needs of its residents. As much as has been accomplished, the above illustrates that serious challenges remain and that new ones have emerged. The need for strong civic leadership on housing is as great as ever.