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Boston’s property value is at a historic $164 billion

Taxable property value has increased the most in Boston’s booming Seaport area in recent years.
Taxable property value has increased the most in Boston’s booming Seaport area in recent years.David L. Ryan/Globe staff/file/Globe Staff

The value of Boston’s taxable property hit a historic high of $164 billion last fiscal year, a 78 percent increase from 2013, according to a report Monday that underscored how expensive the city has become — the same day officials formally asked the state to let them tax pricey real estate deals to fund new affordable housing.

The study, by the Boston Municipal Research bureau, showed that taxable property value grew the most in the booming Seaport District, and the slowest in West Roxbury and Roslindale. It also found some 40,000 people moved into Boston between 2013 and 2017.

“There’s just a lot more people wanting to live in the city in recent years,” said Pamela J. Kocher, president of the bureau.

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The study was issued as the city looks at new ways to confront a housing crisis, including a tax on high-end real-estate deals, with proceeds going to the development of more units for lower income residents.

Mayor Martin J. Walsh signed a home rule petition that, with Beacon Hill’s approval, would let the city tax all property sales, including commercial, over $2 million up to 2 percent. Boston would have raised $169 million a year, on average, over the last decade, had such a tax been in place, city officials have said.

At a signing ceremony Monday morning, Walsh called for state legislators to support the effort.

“Housing is the biggest economic challenge facing our residents in Boston, and across the region,” the mayor said. “We need to continue to push and move forward.”

The spike in property values cited in the bureau report can be attributed to the housing boom over the last six years, Walsh told reporters. That boom may ultimately subside, but property values remain high and out of reach for many.

The mayor said the city is hoping to match the boom with the creation of more affordable housing units — 20 percent of Boston housing developments in recent years have had income restrictions, he said. He acknowledged that middle class people, who do not always qualify for income-restricted units, have felt the most pressure from the increase in housing prices.

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“That’s the one area where a lot of people are feeling the squeeze,” the mayor said, “so we’re trying to provide all of these different opportunities and tools, to try and help families.”

The Research Bureau report found that taxable property values grew by 78 percent over the last six years, part of a broader trend of economic growth in Boston: The city’s annual unemployment rate decreased over the same time frame, from 6.1 percent in 2013 to 3 percent in 2018.

The report cited city estimates that Boston will see the creation of up to 150,000 jobs by 2026.

Meanwhile, more people want to live here: From 2013 to 2017, the city added 39,976 new residents, a 6.4 percent population increase. While the city estimated in 2014 that Boston’s population would grow to 709,000 residents by 2030, that estimate has since been upped to 750,000 residents.

Monday’s report from the Municipal Research Bureau, an independent city watchdog non-profit, was the first of five parts that will look deeper into how the spike in property values has come about and how development has changed the city.

The report found that the spike in property value is spread across all of the city’s neighborhoods, though some areas have seen far greater growth between 2013 and 2019: Property values increased in the Seaport by 181 percent, for instance. In East Boston, they grew by 96 percent. Parts of Mattapan, one of the city’s poorest neighborhoods, and Hyde Park grew by 51 percent.

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Kocher said that new growth made up the brunt of property tax revenue increases for the city, or 60 percent of the $134 million in new revenues last year. She said the city has kept a steady balance of putting most of the burden of its overall tax levy on businesses, rather than residential properties. Residential property taxes, therefore, have not seen any significant change.

But the increase in the interest in city living has added pressure on the housing market, making it more expensive to live here and forcing the city to look at ways to utilize the market to drive more affordable housing.

City Councilor Lydia Edwards, who spearheaded the city’s passage of the real estate transfer tax, said it is one way the city can act “bold” to confront the housing crisis.

“We want to build, we want to grow as a city, and we want to make sure everyone can grow . . . we want that kind of growth,” she said at the signing ceremony Monday at a community organization in Chinatown, one of the neighborhoods facing the most change as a result of the development boom.

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Karen Chen, of the Chinese Progressive Association, said “we want to make sure Boston’s heart and soul stays in Boston.”

So far, local housing initiatives have had little success at the state level, in spite of calls for the state’s help.

In the last state legislative session, a home rule petition the city sent to the State House to protect renters from unfair evictions was killed, amid heavy opposition from the real estate industry. Governor Charlie Baker has also proposed a bill to tweak zoning change procedures at the local level, to facilitate the development of more affordable housing; that bill has gone nowhere.

But advocates said they remain optimistic, amid repeated calls for the state to do more. Walsh is slated to testify at a legislative hearing Tuesday on a bill that would enable the city to increase the rate of mitigation payments it can demand of large-scale developers.

And, several other cities and towns have passed their own local petitions for a transfer tax, similar to Boston’s, spurring talk of a coalition of communities that would push for support from the state.

State Representative Kevin Honan, a Democrat from Allston and Brighton who is the House chairman of the Legislature’s Joint Committee on Housing, said in a statement that he will sponsor Boston’s bill at the State House.

“We are always looking for innovative ways to capture new funding for affordable housing,” he said. “The real estate transfer fee is another tool we can use to ensure our communities are benefitting from a booming economy.”

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Walsh, a one-time state representative, called on legislators to approve the petition, saying the state has done little to confront the region’s affordable housing shortage.

“To have to battle for every little thing we need at the State House is unfortunate,” the mayor said. “The Boston delegation is on board . . . we need to convince the rest of the Legislature to vote for this.”


Milton J. Valencia can be reached at milton.valencia @globe.com. Follow him on Twitter @MiltonValencia