Homeownership Slips Further Away for Boston Renters Amid Rising Costs

The latest data reveals a troubling trend for aspiring homeowners in Greater Boston. A report released on March 13, 2025, by the Boston Foundation shows that only one in seven renter households can afford an “entry-level” home, despite a surge in housing construction. The figures indicate a significant decline, with the share of renters capable of purchasing a starter home dropping from 30% in 2021 to just 15% in 2025.

Luc Schuster, the executive director of the Boston Foundation’s research arm, highlighted that although the U.S. Census Bureau reports an increase in new home completions, it has not translated into improved affordability. He noted a concerning decrease in new housing permits statewide, suggesting that the recent construction upswing may be temporary. “New permits as of July 2025 are running 44% below levels for the same period in 2021,” Schuster remarked.

Rising Prices and Stagnant Incomes Challenge Homebuyers

The annual 2025 Greater Boston Housing Report Card states that Massachusetts added just under 98,000 housing units from April 2020 to July 2025, with approximately 71,000 units located in Greater Boston. While this marks a “meaningful increase,” the report emphasizes that the affordability crisis continues to deepen.

In 2025, home prices and rents have stabilized but remain out of reach for many. A household earning about $98,000 in 2021 could afford a low-end home with a monthly payment of $2,520. This year, however, a household would need to earn over $162,000 to manage the $4,200 monthly payment for a starter home.

Greater Boston comprises a diverse region of 101 communities, including coastal areas, older industrial centers, and urban neighborhoods. While housing costs moderate outside this core area, incomes have often failed to keep pace. For instance, housing prices in Lawrence rose nearly 70% since 2021, reaching a median of $500,000.

Government Efforts and Market Challenges

Lt. Gov. Kim Driscoll addressed the findings of the report, emphasizing the administration’s commitment to housing development through the passage of the $5.2 billion Affordable Homes Act in 2024. Additionally, the MBTA Communities Law mandates zoning for multifamily housing across the 177 communities served by the transit system.

Despite these initiatives, persistent market challenges hinder progress. High land and building material costs continue to obstruct the development of affordable housing. As Lt. Gov. Driscoll pointed out, creating sufficient housing should not be this difficult, yet it remains a significant hurdle in Massachusetts.

The situation in Greater Boston underscores a broader national issue, where rising costs and stagnant incomes create barriers to homeownership. As the data reveals, achieving the goal of affordable housing remains an elusive challenge for many in the region.