[cherrygarcia]

I don't know about SF (I have no first hand experience there) but I can say that the market in the Boston area seems similarly overpriced and not very sustainable. Maybe for some different reasons, maybe some are the same. It's to the point where mediocre 3br suburban homes even far from the city are 500k+. It makes me very hesitant to purchase a home right now because I don't see how the value could do much anything besides decrease from here. That's my gut feeling. Would love to understand better how prices could continue to increase still.

[shados]

Define "far from the city". A 3br for 500k is available (if on the low-ish end) for Whaltam, which Boston folks consider to be in the middle of nowhere, but if it wasn't for traffic/transportation problems, wouldn't be all that far (it's not very far at all if it wasn't for the traffic issues). A friend of mine just got a 1BR 50 minutes away for <150k (and it wasnt even a fixer upper, and is on the commuter rail).

50 minutes is "far", but it's far from insane...

IMO Boston has a lot of places that can be developed within 30-45 minutes before we really need to start tearing everything down. (There's 3 high density development in construction literally in my backyard, so I'm not saying that because I have anything to gain from it, either).

The biggest thing to fix about the Boston area right now is the entrance from the suburb into Cambridge...the Alewife area is ridiculous, but that's what happens when you built a ton of mid/high rise without proper planning of infrastructure.

[helen___keller]

As another Boston resident, I'm extremely hesitant to purchase because I'm fairly confident current prices aren't sustainable and I want to be there to purchase if prices do go down.

I've kept my eye on real estate prices for the past few years and we definitely hit a plateau around summer 2018. Nowadays I see a lot of properties sit on the market for months - quite the opposite of how this "red hot" market is supposed to behave.

I just don't see the fundamentals supporting current prices. A lot of properties are going for 20-50% more than they were previously sold for (in 2012-2014 usually).

On the other hand, rent has NOT increased by 20-50% in that amount of time, and (in my own experience) rent has been pretty flat for the past year or two, except for a few neighborhoods like Allston that have definitely gone up. If rent in a unit stays flat for a few years it's basically impossible for that home's price to keep going up, and since we didn't pick up amazon HQ2, and have tons of luxury development coming in to absorb any other top earners entering the state, I personally doubt there will be much room for rents to grow.

That said, we're no SF. If you work in tech there's probably properties out there you an afford. It just might not be in Somerville or Cambridge where everyone wants to live. Some suggestions: Decent single family in Wollaston neighborhood of Quincy goes around 600k, and further down towards Quincy Adams theres a whole bunch of options. There are occasionally good deals that pop up walking distance to the T in Malden. West Roxbury has good deals almost always. Roslindale isn't totally gentrified yet so you can always jump on that bandwagon and look for a property near Forest Hills. Condos are pumping out in East Boston too although I haven't checked prices lately they might already be too expensive.

[leongrado]

Agreed. I recently moved from the Midwest to Boston and the housing and rent prices are giving me major sticker shock. My rent has tripled and looking at the housing prices, looks like they have too. Who's buying these 1 million dollar homes?

[shados]

That's easy. Depending on the interest rate, condo fees, taxes, etc, a 1 million home is about $4500 (less when the interest rates were lower, I think).

If you have a couple of DINKs, it's 2250 per person per month, or about $27000/year. 150k/year per person, about 90-100k/year after tax, and that's well under 30% of your take home pay.

I used round numbers and I'm probably off, but even if you have to tweak the math, it's pretty easy to see where people are coming from.

When I was looking to buy in the area, a bunch of people looking at the open houses were couples with both people sporting their Amazon/Microsoft/Google/whatever backpacks or jackets.