bostonbubble.com

[john p]

After WWII a ton of starter homes for the GI's were built right inside of the 128 Belt, and then up until the 1970's they had built these raised ranches right mostly just to the outside of 128 and infilled inbetween town centers within 128. These raised ranches were basically just under 2,000 s.f.

Basically after 1980, we had so much starter home stock that most of the new construction were for those that had outgrown their starter homes. This is why our starter home stock is so tired. The "condo" movement kind of took off after they got rid of rent control and the capital gains tax on the sale of real estate in the early and mid 90's. The colleges that expanded inside of Boston put pressure on the housing stock because they never built the dormitories they needed. It wasn't until the Bubble years that you were starting to see newer condo buildings in hipper areas of the city, so young couples had a choice between a tired starter home or do the city life thing.

My basic feeling is that although Boston has changed from a blue collar town to a white collar town for the most part, the housing stock is still a blue collar housing stock, and a tired blue collar housing stock at that. Because the incomes rose, the prices for these places rose, but the quality of the places hasn't risen in kind. I personally moved further out to get to the new construction and the commuter rail made that possible.

I think if you have any concerns about losing your job and you don't have a huge emergency fund, it is best to wait a bit. If you can get a steal and you have an enormous amount of cusion, you could maybe find some opportunities.

What was the historical ratio of rent to buy for condos? 15 times the monthly rent? (this I imagine assumes a standard condo fee?)

Also, note that I have a house that is about 12 years old and I am still putting in a good portion of every other year's tax return back into home repair expenses.

My current exercise is really about looking for a potential inflection point either in the historical affordability metrics (math), or qualitative (value proposition). The big bad wolf of unemployment is out there so I guess not much else matters.

[john p]

I know some of you might like this:

http://www.mass.gov/Ador/docs/dls/mdmstuf/Socioeconomic/DOR_Income_Pop_EQV.xls

[admin]