Despite a slightly softer outlook for renters and an uptick in new development, the perpetually beleaguered Greater Boston housing market still doesn’t look good long term.
The pipeline of new projects could be stalled thanks to rising building and finance costs, and potential initiatives to lift the burden on the housing market have been slow to materialize. Stagnating immigration and lower population growth could free up units, but the broader economy would suffer in return, according to The Boston Foundation’s Greater Boston Housing Report Card, released Tuesday morning.
Overall, the report, which is watched closely by policy makers around Boston, paints a grim picture for the housing market. Here are five key takeaways.
Population loss is not good news
The Trump administration’s continued hostility toward immigration means slow population growth for Greater Boston, which has been heavily reliant on international migration for the past two decades.
Strong immigration levels have usually been able to make up the difference as people leave for other parts of the country. But the report shows that international immigration declined so sharply in 2025 that Greater Boston’s population increased by just 9,000, compared to 49,000 in 2024, per data from the UMass Donahue Institute. It’s the slowest year-over-year growth the area has seen since 2011, excluding the pandemic years when the population shrank. Those new residents came exclusively from births, the report states.
While slower population growth might be a good sign in the short term for the overburdened housing market and bringing costs down, it’s better when prices decline because the housing supply has actually grown. More people leaving the state than coming in also signals the loss of jobs and a weakening of the economy and overall conditions for people already in the area, the report says.
More homes, but fewer permits
2025 saw more new builds get finished, according to US Census data analyzed in the report. That data shows a sizable spike in new units added, which the report card says could be due to the clearing of a backlog in stalled large, multifamily projects from the pandemic.
But it was also the Boston area’s slowest year for the number of new units permitted in a decade, and those numbers have been declining steadily since 2021. The report card also shows that Boston permits fewer new units compared to other major metro areas — only roughly two per 1,000 residents, according to Census Bureau data. And despite an uptick in permitting that has brought levels slightly up in 2026, increasing material costs and high interest rates mean that the timeline on new projects in the future appears weaker in coming years.
Cheap is the new expensive
The report card shows that the entry point to homeownership is getting harder to reach. The cost of a single-family home, especially at the low end of the market, has increased faster than home values in the mid- and high-tier market.
In 2016, 42 towns had median sale prices under $500,000 adjusted for inflation. Today, just six towns can boast such low numbers. Compiled data in the report shows that a household needs an estimated annual income of $180,000 to afford a $600,000 single-family home, which the report determined was the median sale price in low-end market municipalities based on data from the Warren Group.
Question 7, which voters narrowly rejected last week during the midterm elections, would have reduced the lot size required to build a single-family home. Advocates of the ballot initiative claimed that it would boost construction of starter homes and help reduce costs for first-time home buyers.
Softening rents aren’t all good news
The report card found that Greater Boston has the third-most expensive rental market, only behind New York City and San Francisco, pulling data from the Zillow Observed Rent Index. The index puts the area’s monthly rent at $3,074.
The report card shows that vacancy rates were up very slightly in 2025 from the previous two years, though they’re still some of the lowest in the country at 3.2 percent. But more recent data this year may point to a softening market. Since 2022, the amount of time it takes to lease an apartment has increased from 22 days to 31 days in August 2026, per data from Apartment List in the report.
Signs of a softer rental market might be related to slow immigration levels and lower demand overall, but the data is still limited, the report states.
What’s more concerning, though, is the uptick in severely cost-burdened households, who are spending more than 50 percent of household income on housing costs. The report card compiled data showing that severe cost burden on low-income families making between $35,000 and $50,000 has grown from 9 percent in 2006 to 51 percent in 2024; and 24 percent of families making between $50,000 and $75,000 were also severely cost-burdened, up from 1 percent in 2006.
To combat the rising costs of housing and the lack of affordable options, “social housing” has been floated as a potential option, both nationally and in local municipalities such as Cambridge.
The report card includes a special discussion on the possibility of social housing across the area. Social housing describes mixed-income units in publicly owned or subsidized buildings that are permanently affordable, and serve a variety of residents at mixed incomes. There have been successful initiatives: the report cites a potential model in Vienna where more than half of residents live in government-owned or subsidized housing. It also noted another scheme under the social housing umbrella in Seattle and Montgomery County, Maryland, which has a dedicated commission that develops apartment buildings with the goal of keeping units permanently affordable.
While Cambridge already has a task force dedicated to finding a solution to high housing costs based on social housing concepts, it hasn’t taken off across Greater Boston, partly because it’s not well-defined or broadly understood. The report points out a number of possible avenues for developing such a solution, but a significant push across the area would require a coordinated effort by existing housing groups, elected officials, and overall community backing.
Karyna Cheung can be reached at karyna.cheung@globe.com.