The Hot Five

A shift is occurring in the area's housing market. First-time home buyers who find it impossible to afford a house in most of Boston and its expensive suburbs – despite a year of declining real estate prices – are fanning out. They are building communities in outlying suburbs or creating hot new markets for condominiums, which a growing number of young professional buyers find more affordable and more pleasing than houses. Here are five places where young people are finding their niche.

Lowell

Population 96,876 (2005)

Median Single-Family Price $255,000 (2006)
Change in Median single-family Price from 2005 to 2006 - 4%
Homeownership Rate 43% (2005)
Median Household Income $41,272 (2005)

This old textile city is becoming a cultural mecca, whether one gravitates to outdoor concerts on warm summer nights, productions at the Merrimack Repertory Theatre, or the artists’ work spaces in the Ayer Lofts Condominiums and Art Gallery on weekend afternoons. The historic museums, the Lowell Spinners baseball team (above), the popular, eclectic bistro La Boniche, and the intellectual life of the University of Massachusetts at Lowell all add to the lure of the state’s fourth-largest city. As do the prices. After a flurry of downtown condo and loft development during the housing boom, Lowell’s prices have slumped. But condos are still available in the renovated mills, offices, and other commercial buildings in and around the beautiful old downtown area, known as “the square,” which is a short walk to the inbound train to Boston. December’s median price for a condo was $163,500, down 25 percent in a year. “There’s been a steady flow of buyers, and new product has come on line,” says Lowell real estate agent James Cooney. Lowell’s school system is considered troubled by some, but its special education program excels, and St. Michael Parish School is a good private alternative. New parents might consider moving across the Merrimack River to Dracut for better schools and single-family homes under $300,000.

Billerica

Population 38,981 (2000)
Median Single-Family Price $337,187 (2006)
Change in Median single-family Price from 2005 to 2006 - 9%
Homeownership Rate 84% (2000)
Median Household Income $67,799 (1999)

House prices in this bedroom community are lower than those in the slightly more desirable surrounding towns of Bedford, Burlington, Wilmington, Tewksbury, and Chelmsford. First-time buyers have discovered this enclave’s relative proximity to Boston, respectable schools, and breezy access to routes 495 and 128. Three years ago, Sports Illustrated awarded Billerica – known for its active Pop Warner baseball, Little League, and youth hockey – the “50th Anniversary Sports-town” title for having the best community sports programs in Massachusetts. Its big lure for young couples is a large stock of affordable split levels, ranches, and Capes; the bulk of home sales so far this year were in the $250,000 to $400,000 range. Maintained by tidy middle- and working-class owners, the homes tend to be in good condition, though often in need of modernizing. The town common, while not on a par with Concord’s or Lexington’s, can claim a new library and senior center. In a sure sign of yuppie settlement, a Starbucks opening made news here in 2005. One of the best watering holes is the Emerald Rose Restaurant and Pub, with Bass Ale, Smithwick’s Ale, and Killian’s Red on tap. The pub is on Route 3A, the chain-store-lined commercial strip that cuts through town. Billerica is the place to buy a first home or trade up to something big enough for children.

East Boston

Population 38,807 (2005)
Median Single-Family Price $305,000 (2006)
Change in Median single-family Price from 2005 to 2006 - 8%
Homeownership Rate 28% (2000)Median Household Income $36,259 (2005)

The spotlight is on the $1 million-plus luxury condo projects with panoramas of Boston’s skyline that will soon spring up on the waterfront. Behind them are Webster Street’s gentrified homes with water views – and prices to match. The draw for first-time buyers is that Sumner Tunnel traffic has eased since the opening of the alternative Ted Williams, and the two routes provide fast access to virtually everything: I-93, I-90, Storrow Drive, and Government Center. A fringe benefit of this major public-works project is that once-isolated Eastie is becoming part of downtown. Despite rapid change, the Boston neighborhood retains its Italian feel, especially on historic Eagle Hill, and its more recent infusion of Latino culture, even as more and more immigrants flee rising rents or cash out on increasing property values there and move to the suburbs. Though the bar scene is lacking, the pupusas – Central America’s answer to the tortilla, they are bready wraps filled with meat and melted cheese – are mouthwatering at Restaurante El Buen Gusto. The Maverick subway stop – one of five in East Boston – anchors a vibrant commercial district. Much of the housing stock is in need of repairs or updates, but row on row of triple-deckers and two families (below) are being renovated and sold as condos. Where else this close to downtown can one still find 700 to 1,000 square feet for less than $300,000?

Watertown

Population 32,986 (2000)
Median Single-Family Price $420,000 (2006)
Change in Median single-family Price from 2005 to 2006 - 9%
Homeownership Rate 47% (2000)Median Household Income $59,764 (1999)

Location was never Watertown’s issue; there just wasn’t a lot of housing for sale. Wedged between lively Cambridge, Newton, and Waltham, sleepy Watertown has good schools, amenities like yoga outlets, and a bounty of eateries – from the Deluxe Town Diner and Greek bakeries to gems like La Casa de Pedro for grilled steak and fish (below) and Tantawan for excellent Thai. It lacks only a subway stop. Today, there’s new hope for first-time buyers: Watertown condos in their price range. Development is starting in the rugged light-industrial area around Pleasant Street near the Charles River. Until recently, the most conspicuous resident there was Russo’s, a sprawling farmer’s market with a nursery, a deli, and a cornucopia of vegetables from celery and carrots to bok choy and Chinese eggplant. Two Pleasant Street projects are selling fast: the 56-unit Riverbank Lofts, built as a laboratory but never used for that purpose, and Repton Place, a newly constructed 386-unit project. Repton Place prices start around $265,500 for studios and $275,500 for one bedrooms and rise to about $416,500 for a one bedroom with den. More development, including retail space and restaurants, is inevitable, says Joseph Laurano, Repton Place’s sales director. “There is a lot going on on Pleasant Street.”

Brockton

Population 91,938 (2005)
Median Single-Family Price $269,900 (2006)
Change in Median single-family Price from 2005 to 2006 - 2%
Homeownership Rate 57% (2005)Median Household Income $47,250 (2005)

Brockton is a workingman’s city, and working people who are first-time home buyers are like many first-time buyers: They like the spare, clean feel of loft living. This is where to find it, at rock-bottom prices. Saturday nights on Brockton’s quiet Main Street, a pulse emanates from Tamboo, a lounge and bistro with Haitian-inspired fare like plaintains – sweet or green – and whole red snapper with herbs. Some condos are located along Main Street. Others, near the train station, are popular with commuters – who can roll out of bed, dress, and hop the train downtown – or Brockton police, who at the start of their shifts only need walk across the street to the police station. Remarkably, Brockton’s condos had higher sales last year than in 2005. Developers of the Lofts at SoCo (south of Court Street), a converted Etonic shoe factory, were eager last month to sell the few condos left because they’re headlong into brisk sales a block away at SoCo 146, a 72-unit project where one bedrooms start at $139,000. Brockton’s houses are affordable, too. A group of young homeowners who call themselves Emerging 40 promotes Brockton not as a city grappling with crime but as a welcoming collection of middle-class neighborhoods. While the schools have many of the problems of an urban system, it has bright spots, namely the Gilmore Academy middle school and the Edgar B. Davis Community School for kindergarten through eighth grade.