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A different trend is happening in one New England state, while the rest of the country is experiencing a surge of home listings. Massachusetts is seeing shrinking inventory, coupled with climbing prices—pushing affordability further out of reach.
In July 2019, nearly half of all homes for sale in the state—about 8,600 listings—were priced below $500,000, according to Realtor.com® data. By July 2025, that share had dropped to just 22%, or roughly 2,400 homes.
Meanwhile, the luxury segment has grown. Only 18% of homes for sale in 2019 were listed for more than $1 million (about 3,300). This July, the share doubled to 36%, or 4,000 listings.
The overall number of homes for sale has also fallen. Massachusetts had around 18,000 active listings in mid-2019. Six years later, that number is down to just 11,300.
The result has been a market where younger buyers, already struggling to get a foothold, are finding the odds stacked against them. Nationally, only 36.4% of people under age 35 own homes, according to the National Association of Home Builders. In Massachusetts, tight inventory and steep prices make that milestone even harder to reach.
“In my two decades in the Massachusetts mortgage business, I have never seen a more challenging time for millennials to purchase a home. Home prices have skyrocketed due to persistently low inventory, creating an extended seller’s market,” says Bob Driscoll, a local mortgage professional.
(Realtor.com)
He points out that financing is often not the sticking point.
“Qualification isn’t the biggest obstacle for first-time homebuyers. The real challenge is saving—not just for a down payment, as in years past, but also for the potential bidding war that often drives prices beyond the asking price.
“This financial hurdle is compounded by the emotional toll of repeatedly bidding on homes, only to lose out to higher offers. Many future homebuyers feel demoralized after multiple failed attempts, making the dream of homeownership seem increasingly out of reach,” he adds.
(Realtor.com)
Prospective buyers are wary of affordability crisis
That stress is only heightened by rising costs outside the housing market.
“Price growth has been strong in Massachusetts, so the lower tier of inventory has been bumped up to higher price levels, and there are fewer homes remaining below $500,000,” says Joel Berner, senior economist at Realtor.com®. “Additionally, there has been little new construction of single-family homes happening in Massachusetts and across the Northeast, so little new inventory is coming in at lower price levels or forcing existing homes to keep prices low to compete.”
As prices keep going up and inventory shrinks, affordability for new buyers becomes more of a challenge.
“The inventory constraints in Massachusetts make it harder for middle-income families to afford a home there because there are so few options on the market, and what is available is very expensive,” says Berner. “Sellers are responding to their position of power in the market and are listing more homes at or above $1 million. They can command these prices because there is less competition from other for-sale listings.”
For many buyers, student loans are a heavy part of the equation. Today, it’s common for graduates to leave school with more than $100,000 in debt, especially after spending an extra year on advanced degrees, says Driscoll.
Instead of setting aside income for savings or investments, many funnel their money toward loan payments while covering high rents—making it harder to build the reserves needed for homeownership.
“The ongoing housing shortage has driven up both home prices and rental costs in Massachusetts, making it increasingly difficult for many to save. Skyrocketing rents, coupled with the rising cost of education, have created financial challenges that previous generations didn’t face at the same scale,” says Driscoll.
National data shows why affordability has become such a pressing issue. The Realtor.com July Monthly Housing Market Trends Report found the median U.S. list price at $439,990, up 0.5% from last year but mostly flat in recent months. The price per square foot also rose by 0.5%.
Since June 2019, the typical list price nationwide has jumped more than 37%, while the price per square foot has soared nearly 52%. Those increases, layered on top of student debt and higher rents, make the path to ownership especially steep for younger buyers.
In Massachusetts, without a meaningful boost in inventory, many first-time buyers could find themselves locked out of the market for the foreseeable future.