Massachusetts Suffers 100 Years of Housing Growth Stifling, Increases Gap Between Home Sales Median Price

Massachusetts now feels the effects of a century of stifling population and housing expansion. The state legislature has allowed local governments to impede home development since the early 20th century. The future of the Commonwealth is now in jeopardy due to the fallout.

Voters in Massachusetts enacted a constitutional amendment a little over a century ago that gave the Legislature broad new authority over the seemingly mundane matter of where and what kind of dwellings might be built. This right to “restrict structures according to use or construction to defined regions of cities and towns” was established by an amendment in 1918.

Housing should be a matter of public policy, not just left to the whims of builders and real estate businesses; this was the Commonwealth’s boldest declaration to date, and it was made in the 60th amendment to the constitution. The amendment gave the public more say in how the state grows in the future, shifting power away from individual landowners.

The state would determine where three-story homes, Victorians, apartment complexes, and other structures like garages, stores, and factories may be built and how much land each network could use. The amendment resulted from Progressive Era optimism that a strong central government might advance the common good and foster peaceful neighborhoods.

The state administration effectively gave up its newfound authority less than two years later. Massachusetts is currently experiencing a housing scarcity that has persisted for decades and may have origins in poor choices made a century ago.

Cities and towns, given jurisdiction over planning and zoning by the state legislature in 1920, quickly began utilizing it to enact regulations that stifled housing construction and excluded low-income residents and renters.

Increases Gap Between Single-family Home Sales Median Price

Look at the graph illustrated below to see how the difference between the median price of homes sold has grown over time:

Greater Boston had higher housing costs than the rest of the country in 1989. It’s become even more apart now. The chasm has widened even further now. Soon after the zoning change was passed, red flags began flashing, warning of the potential adverse effects of local obstructionism. To accommodate returning troops, the Boston Globe reported shortly after WWII that zoning limitations in many Greater Boston towns impede substantial rental projects.

A 1979 feature about housing in Braintree reported, “Because of zoning regulations and environmental restrictions … it is no longer financially feasible to build housing for the middle class in town.”

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Such cautions were disregarded for the most part. Meanwhile, the house price disparity between Massachusetts and the rest of the country has continued to increase. The median home value in Massachusetts in 1940 was $13,300, 1.3% more than the national average. It was 1.55 times in 2000. The multiple in 2021 was 1.7.

It looks like the time has come to pay up. Greater Boston saw a January median single-family house price of $707,250, well above the national median of $378,700 for the same period. The percentage of tenants in Boston who are “rent-burdened” is 46%.

Housing activists have warned for years that the state’s capacity to attract and sustain enterprises will suffer due to high housing costs and the allure of cheaper housing elsewhere. Since the pandemic’s inception, nearly enough individuals to fill Fenway Park three times over have fled the state, and now that number appears to have crested at 110,000.

Yet, the state’s housing issues are no longer abstract for the thousands of people affected. Those pushed out due to state housing policies are beginning to have an equal amount of a public voice as the anti-housing suburbanites who have previously dominated the public discourse.

The state’s challenge, a recurrent theme in these people’s experiences, is the severe shortage of affordable housing options. The state’s annual underproduction of homes only exacerbates the problem. More new homes of all types need to be developed over a long period of existing home price gains that are too slow.

And for more to be created, the state must remove barriers for those who want to construct them, whether those barriers are monetary, as in the case of the market, or legal, as in the case of stubborn local governments. Several of the elected authorities here truly care about the community.

Housing has been a priority for Michelle Wu, mayor of Boston, and a few other mayors and city council members. Nonetheless, many municipal leaders across Braintree and Rockport oppose building additional homes in these communities. Furthermore, governmental leadership is vital.

After taking stock of the suburbs’ anti-rental sentiment, one Globe columnist speculated that the state would take away the zoning privileges of local municipalities. In other words, the state desperately needs a long-overdue reckoning with local control.

Housing issues are not quickly resolved because of their complexity. Permitting and construction can take a long time. Yet, Massachusetts is currently in a position where it can decide how to fix the housing crisis. If the government doesn’t ensure that people’s homes are adequate for their needs and aspirations, people may lose families and businesses.

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