Highlights from the Boston Real Estate Now blog.
Downtown Boston has become a playground for the rich, dominated by luxury condo towers with multimillion-dollar units.
The median price for a luxury condo in neighborhoods like the Back Bay, South End, and Beacon Hill hit $1.4 million during the first three months of the year.
That’s a phenomenal 22.7 percent increase over 2012, according to LINK numbers cited in a May 1 story in the Globe Business section.
Well it’s all part of a global phenomenon that threatens to turn the world’s top cities into “gated citadels,” British author Simon Kuper warns in the Financial Times.
“Global cities are turning into vast gated communities where the one percent reproduces itself. Elite members don’t live there for their jobs. They work virtually anyway. Rather, global cities are where they network with each other, and put their kids through their country’s best schools.”
Earlier waves of gentrification pushed the poor and working class out of the downtowns of the globe’s most coveted metropolises. Now it’s the middle and upper middle class that are getting the boot, Kuper argues.
“That was gentrification. Now comes plutocratisation: the middle classes and small companies are falling victim to class-cleansing. Global cities are becoming patrician ghettos. In 2009, says (Columbia University’s) Sassen, the top 1 percent of New York City’s earners got 44 percent of the compensation paid to its workers. The ‘super-prime housing market’ keeps rising even when the national economy collapses. After Manhattan, New York’s upper-middle classes are being priced out of Brooklyn. Sassen diagnoses ‘gradual destruction.’ ”
Of course, if it was all just happening in downtown Boston or Manhattan it might be easier to write off. Sure it would be nice living in the Back Bay, but I am hardly heartbroken that I can’t afford to live there and realistically never will.
Yet the same trend is happening in some of our toniest suburbs as well, which, if not gated communities, now require entry fees, as measured in median home prices, of $800,000 to more than $1 million.
Both home prices and rents rose sharply again in May across Greater Boston, online real estate portal Zillow reports.
Home prices rose 5.4 percent, led by some of the usual suspects, Boston, Cambridge and Brookline, and, in a bit of a surprise, Revere.
That comes on the heels of reports that condo and multifamily prices are soaring in Everett as Las Vegas titan Steve Wynn forges ahead with his casino plan.
Who knows, maybe Revere is benefiting from all the real estate speculation stirred by the casino proposal — Revere is next door to a rival gambling mega project being pushed by Suffolk Downs.
Revere home values are up nearly 10 percent over 2012, to a median price of just over $247,000.
Of course, it could just be that rising prices across the Boston areas have buyers searching for affordable homes, including Revere, Everett, and Chelsea.
Rents are also up another 5 percent across the Boston area, to a median of just under $2,000, according to Zillow?s latest report, which covers May. Rents in Hyde Park jumped 13.1 percent, with Brighton up 12.8 percent and East Boston up 12.3 percent.
Meanwhile, as prices and rents rise, foreclosures are on a steep decline across the Bay State.
Just 248 foreclosure petitions were filed in Massachusetts in May, an 86 percent decline, the Warren Group reports.
That is the lowest monthly number since the real estate market started to unravel eight years ago, in 2008, the firm reports.
Scott Van Voorhis is a freelance writer who specializes in real estate and business issues. For the full Boston Real Estate Now blog, visit www.boston.com/realestate.Handyman on Call’s Peter Hotton is not writing today.