Massachusetts Undersupplied with Demands for Low-Income Housing

The housing outlook for low-income residents in Massachusetts is beginning to look bleak, as new reports reveal Massachusetts is seriously undersupplied when it comes to housing for its low-income market. Massachusetts has less than half the needed apartments extremely low-income households can afford, and the Federal Reserve Bank of Boston expects the gap to widen in the coming years if the affordable housing policy does not undergo serious changes. The low-income category is defined as households earning less than $29,150 for a single family of three, or $22,650 for a single person.

According to recent reports by the Boston Globe, Massachusetts currently has 274,842 extremely low-income households, but there are only 128,037 apartments in the state with rents they can afford. The low-income renter segment of the Massachusetts population has grown since 2011, but not as fast as the higher-income segments. The number of residential units low-income residents can afford without being rent-burdened has declined, and the situation is only expected to grow worse. Being rent-burdened is defined as spending more than a third of one's income on rent.

Furthermore, over 9,000 subsidized residential units are expected to lose low-income subsidies in Massachusetts by 2025. This means more than 25 cities and towns across Massachusetts wouldn't have any subsidized housing at all. Numerous municipalities have looked into buying or refinancing the units with expiring subsidies, however the federal government forecasts it could cost between $843M and $1B annually to maintain and develop affordable housing in Massachusetts by 2035.

Overall, affordable housing solutions have become a much-discussed concern for Massachusetts policy makers and real estate developers. Boston lawmakers are revising changes to its Inclusionary Development Policy that would require market-rate developers to create affordable residences in developments with 10 or more units. In addition, municipalities have set targets to build more housing to bring down high prices.