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Wages lag, home prices soar

Posted by Scott Van Voorhis September 2, 2013 08:58 AM

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Massachusetts home prices have gone nuts over the past few decades.

And, sadly, wages have not kept up, not by a long shot.

In honor of Labor Day, here are a couple of interesting stats.

The median wage of the Massachusetts workforce has risen 18 percent since 1979, the Massachusetts Budget and Policy Center reports.

And we are working harder than ever for those dollars - productivity soared during the same period by 112 percent.

Yet while we may be making more on average, home prices have gone through the roof over the last three decades or more.

Basically, we are working our tails off and getting much less for it, especially when it comes to the real estate market.

The median home price in Massachusetts doubled to $185,700 in 2000 from $95,800, adjusted to 2000 dollars, according to U.S. Census Bureau numbers.

I couldn't find inflation adjusted numbers for Massachusetts to take us up to 2013, but the Case-Shiller index, which tracks the Greater Boston market, offers a clue.

Median home prices rose another 60 percent since 2000 in the Boston metro market, according to Case-Shiller. That includes much of Eastern Massachusetts, where the vast majority of the state's population and housing market is located.

So let's adjust it and say Massachusetts home prices are up another 50 percent from their 2000 levels.

That would put the inflation adjusted median at about $280,000 - triple what it was in 1979.

Really, is the average home in Massachusetts three times better than it was in 1979?
Hardly.

This blog is not written or edited by Boston.com or the Boston Globe.
The author is solely responsible for the content.

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About boston real estate now
Scott Van Voorhis is a freelance writer who specializes in real estate and business issues.

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