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Off a cliff: Boston sees housing construction plunge in 2023
New apartment and condo towers and buildings have seemingly sprung up on every street corner in Boston over the past decade.
But after slowing dramatically during the last half of 2022, new residential construction has all but ground to a halt in the first few months of the year.
Just a couple hundred building permits, mainly for two- or three-family homes or small rental buildings, were issued in the Hub through mid-March, according to a review of city records by Contrarian Boston.
That’s compared to more than 1,000 during the same period last year in early 2022. We didn’t include public housing - such as the extensive renovations of a couple hundred units at the Mildred C. Hailey Apartments in Jamaica Plain - as we were looking to gauge the health of the private sector.
The drop in construction comes as rents and prices in Boston remain at sky high levels, with even the new construction of recent years unable to move the needle yet after decades of stagnation.
Meanwhile, surging interest rates, high inflation and economic uncertainty has left many developers and contractors on the sidelines, unable to land financing for new projects or unwilling take the risk.
The Wu administration’s push to require developers to include a significantly higher number of money-losing subsidized units in each new condo or rental building, as well as its campaign to bring back rent control, has clearly unnerved some real estate players as well.
“Developers are scared to death of those policies,” said one observer who works closely with the sector.
A city spokesperson did not respond to CB’s request for comment by our deadline.
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