Boston’s homes now more valuable than their suburban counterparts
A new Zillow report notes that home values in Boston’s suburbs are currently lower than in Boston proper and have increased at a lower rate in the past five years.
Nationally, the value of the average urban home grew 7.5 percent in 2015, while suburban home values grew at a slower 5.9 percent – a reversal in the usual trend.
In Boston, the percent difference between urban and suburban home value increases was even larger, according to a new Zillow report.
Home values in urban Boston increased 9.6 percent from 2014 to 2015, while suburban home values increased 6.2 percent during the same period. Urban homes ended 2015 with a median home value of $440,869 and suburban homes with a $426,356 median value, according to the Zillow Home Value Index.
Zillow noted that in 2013, the average urban home was worth 1.2 percent less than the average suburban home nationwide.
The trend of owners moving back to cities from the suburbs, giving up larger single-family homes for smaller condos, has been driving the shift in relative home values.
From 2010 to 2015, Boston’s median home value increased 37.1 percent, while home values in the suburbs increased 20.5 percent, just a little more than half as much.
Not only are young people moving to the city, but empty nesters have also made the switch. Boston was ranked the number one city empty nesters will flock to in 2016.
“This trend, in part, reflects home buyers’ changing preferences, as they seek amenity-rich, dense and walkable areas that are often closer to their workplace,’’ Zillow Chief Economist Dr. Svenja Gudell said in a statement. “In the future, this lifestyle trend will change some suburbs as we know them, and they’ll start to feel more urban as buyers move further from city centers in search of affordable housing in communities that still feel urban.’’
As Zillow notes, the trend is not good news for low-income people. As home prices go up in cities, low-income earners are forced to the suburbs, with longer commutes. While, on the other hand, high-income earners are able to afford homes closer to city centers, making their commute much shorter.
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