Multi-million dollar cities than ever before and hot and hot housing markets come to mind when trying to describe the current world of residential real estate. But Boston’s cold climates and its (extensive) commuter area are among the hottest housing markets there, Realtor.com says.
The Manchester-Nashua metropolitan area in New Hampshire was the hottest housing market in the country in February, according to the Location Index, which takes into account demand (measured by the unique views of each property) and pace (measured by the number of days The list is active). In other words, a lot of people are quickly buying homes or looking for homes in this area, around the southeastern tip of New Hampshire, which has long had a reputation as a tax-friendly haven for wealthy Bostonians who can afford a second home.
Home prices across the country rose less than half a percent in February, but the Manchester-Nashua area saw home prices rise 3.8%, well above normal. But it’s not the only New England market to make the top 10. Seven of the 10 hottest markets are located within a two-hour drive of Boston or less, including the Boston/Cambridge area itself. These are either commuter or super-commuter cities as Boston adapts to the era of hybrid work.
After Manchester, there is the city of Worcester, located in central Massachusetts, which ranks third on the list. It is closely followed by the city of West Springfield in fourth place. Boston itself is sixth on the list. Hartford, which is equidistant from Springfield to Boston, follows at No. 7, tied with Providence, which is somewhat closer. Then there’s Concord, New Hampshire, ninth on the list, just 20 minutes from Manchester.
None of these markets are exactly the same, though they all share cheaper home prices and a much smaller population than you’d find in Boston, which has served as a “remote work hub” for years now, according to Axios. Remote work peaked in 2021, with nearly 27% of people in the Boston metropolitan area working from home, and the latest available census data shows it has not declined significantly, with more than 20% of people still working from home. Home in 2022. Major employers in Boston, such as Square and PwC, have offices in the city and use hybrid and remote work models. Just look at the decline in office values to see the continuity of remote work: One analysis found that a decline in office values could lead to a 10% drop in city revenue, according to the Commonwealth Beacon. “The rise of remote work, and the corresponding decline in office values, is eroding the tax system in a way that seems likely to continue for a long time,” a report by the Center for State Policy Analysis at Tufts University for the Boston Policy Institute states. He said.
Secondary cities
These hot housing markets could certainly be second home purchases by affluent Bostonians or primary home purchases by locals — there’s no way to know for sure. But the fifth of Boston’s workers who live far away could just as easily work from Manchester, Worcester, or even Springfield. However, Boston remains the region’s major economy, despite what appear to be lasting effects of remote work.
“While the population working in Boston establishments is approaching pre-pandemic levels, commutes into the city in December 2022 remained 41.4% below their level in the same month in 2019,” Boston’s Planning and Development Agency wrote in a report last year. . “The number of travelers in the second half of 2022 saw only a modest increase compared to the second half of 2021, confirming that the remote and hybrid working arrangements put in place during the pandemic remain in place.”
And if you’re a hybrid or remote worker in the Boston area, consider home price arbitrage. The median home value in Boston is approximately $720,000, but in Manchester and Worcester it is approximately $390,000. The median home value in Providence is approximately $373,000. And Hartford is just $162,000, per Zillow. Just last year, Jeffrey Thompson, vice president and economist at the Federal Reserve Bank of Boston, said housing affordability was a concern; Not enough homes were built in New England to push prices down. Thompson made the statement during a state-of-the-economy meeting hosted by the central bank itself, where housing took center stage, but remote work was discussed relative to demand. “If people continued to work more from home … the demand for housing might be different,” said an associate professor emeritus at Northeastern University.
None of the six housing markets mentioned above compare to Boston in terms of cost. So it’s possible that hybrid or remote workers, formerly or currently residing in Boston, are choosing to move to these surrounding urban areas because of cheap home prices, especially at a time when affordability is so tight — when you need to make an extra $30,000 to gain money. Buying a mid-priced home, or when the salary needed to buy a new home has nearly doubled since the outbreak of the pandemic.
Additionally, an interactive tool included in Apartment List’s renter migration report shows that 5.6% of its users who live and rent in Boston are looking for homes in Manchester, 7.4% in Worcester, and 11.3% in Providence.
like luck It was previously reported that what appears to be a new kind of remote work city has driven a $2 trillion surge in the housing market over the past year, with affordable urban areas seeing the biggest jumps, while “expensive metros and pandemic boomtowns.” “Either declines or Redfin’s analysis found very little gains. For example, two cities in New Jersey saw their home prices increase by more than 10% each, “partly because they are attracting demand from people who were priced out of New York and can now work remotely,” the analysis said. What’s more, similar urban areas have seen such gains because they are “affordable, and when mortgage rates and home prices go up, demand for affordable homes goes up,” Redfin said at the time.
These cities resemble what the World Bank called a “secondary city.” They’re sort of “secondary hubs” for larger urban areas, or where people go after leaving higher-priced cities like Boston. Not to mention, every one of those secondary cities, satellite cities, or outlying work towns (whatever you want to call them) saw their home prices rise by a little less or more than 10% in the past year. On the other hand, Boston itself saw its home values rise just 2.6% over the same period, according to Zillow.
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