While the Greater Boston area has gained over 200,000 residents since 2000, it is also experiencing a shift in its population. The Commonwealth is seeing more multi-family units than in previous decades, creating a new growing demand for smaller homes as aging baby boomers and young millennials are now making up a large portion of the greater Boston areas population.
The Commonwealth’s recovery from the major recession in 2007-2009 has been impressively strong. Despite adding new workers to the Greater Boston job market in the fields of science, health care, higher education, information technologically and financial services, the greater Boston area’s unemployment rate dropped from 9.5% in 2010 to 4.7 by November 2014. Earnings in the area have also increased making the Greater Boston area and its suburbs an attractive place to live especially for empty-nesters and young millennials. These millennials and aging baby boomers are looking to inhabit smaller multi unit housing rather than the larger single family homes. Unfortunately, the Boston and the surrounding cities, have an undersupply of these multi-unit housing and the surburan areas have a overly large supply of big single-family homes, making a huge discrepancy between the current growing housing trends and the actual supply in the greater Boston area.
Why the demand for big homes is on the decline?
There are several reasons why the demand for big homes in this area is on the decline. The main reason however, is that many of the baby boomers have raised their families and are growing older and are looking to down-size into a home that is easier to care for and less costly than those large single-family homes they once owned. Those baby boomers who were born between 1946 and 1964, are simply looking to live out the rest of their lives either in smaller suburban homes or multi-unit urban housing.
In addition, those couples born between 1965 and 1980 known as the baby bust generation, because they delayed having children until they were older while looking to purchase those single-family homes for sale by the baby boom generation is simply too small to fill the supply of all the single-family suburban homes that are all ready available let alone the new homes that are currently being built. The Baby Bust generation living in the Greater Boston area and it’s suburbs is at 20% smaller than the Young millennials that are entering into the area looking for smaller housing.
The increasing need for multi-unit properties
Just like the demand for single-family homes are on the decline there is an increasing need for multi-unit properties both in the cities and the suburbs in the commonwealth. Retired baby boomers are looking to enjoy their retirement and so are looking for affordable apartments, duplexes and other multi-unit properties to relieve them of some of the upkeep and chores associated with owning a single family home.
Besides the growing population of baby boomers, Young Millennials are also flocking to area for work and are looking for small compact places to live suitable for singles and couples, as these younger workers simply have not yet made the decision to start their families. These millennials are quickly learning that by doubling or tripling up with their roommates they can easily afford the nicer duplexes and other multi-unit properties thereby driving out the working middle class and those who are on a limit income.
Problems caused by the shifting housing trends in the greater Boston area
The lack of adequate multi-unit housing is causing some problems for certain segments of the population in the Greater Boston Area. The middle class working couples and singles are being driven out of multi-unit housing by the Young Millennials whose incomes are higher and can pay more for their housing.
Those low income families are being asked to pay more and more for housing and many of them are now at the point of having to worry about the potential for becoming homeless if housing costs continue to increase.
The discrepancy in housing demands and available types of housing will continue to grow
The Discrepancy between the type of housing people need and are seeking and the available types of housing in the greater Boston area will only continue to grow over the next several years. By 2030, it is predicts that the commonwealth will have a 138,000 more single households. All ready 30% of the housing units in the five counties that make up the Greater Boston area are single people and 60% of the households have no more than 2 people, while only 23% of the housing have 4 or more people living in it.
This means that there is a real need for the development of more multi unit dwellings to be built over the next few years, however zoning laws and the high cost of construction is going to make any development for multi-unit dwellings extremely challenging.