Has the downturn truly made Greater Boston home prices affordable?
Sure, prices are down somewhat from their bubble years peak - say 15 percent locally. But while our local housing market is more affordable now than back in 2005, prices are still too high for most buyers.
Don't take my word for it - check out this new report by researchers at the Federal Reserve Bank of Boston.
Given the ongoing debate on this blog and in the comments section on whether prices are still seriously out of whack in Greater Boston, it makes for fascinating reading.
The good news is that prices have fallen back to levels not seen since 2000/2001, the Fed reports.
Overall housing affordability has improved by 10 to 20 percent across New England.
Yet in the Bay State, housing prices are still 18 percent above what buyers earning the median income can afford, the Fed report finds. (For the Boston area, the median income for a family of four is just over $90,000.)
And for many first-time buyers across New England, getting a foothold in the real estate market is still daunting. Overall, home prices across the region are anywhere from 20 to 40 percent beyond what first-time buyers earning the median can afford, the Fed finds.
One startling finding: Worcester is the only major metro market in New England where prices are truly affordable to first-time buyers, according to the report.
Young professionals, with more income to burn, have it somewhat better off, the Fed finds, helping make the Boston area somewhat more affordable compared to New York and San Francisco.
Then again, this may be a matter of timing more than anything else. The real estate market began to soften in the Boston area as far back as 2005 and 2006, with the downturn hitting cities like New York and San Francisco somewhat later, the report notes.
It's a good read, so take a look.
