Skip to comments.In Boston, Nearly 1 in 20 Households are Millionaires
Posted on 01/01/2006 4:29:56 PM PST by HostileTerritory
The number of millionaires living in the Boston area, already one of the wealthiest regions in the United States, will surge 50 percent over the next five years, according to data from two wealth management companies that have studied the issue.
For a city that as recently as 30 years ago struggled with a decaying urban core, the expected influx is one more sign of its dramatic turnaround. By 2009, the number of millionaire households in the region is expected to increase to 88,000, up from 58,000 in 2004.
The projected growth rate parallels the national average. But because Boston starts out with a higher percentage of millionaires in its population -- nearly one in 20 households, more than New York, Chicago, and Los Angeles -- and because the overall population is barely growing, demographic specialists expect more impact here.
The wealth surge will shape the future of the region and the quality of life in Boston, both for future millionaires and those who are nowhere close. Already, businesses catering to the wealthy are flocking to the city: Steakhouse Smith & Wollensky, where the average evening diner spends $72, opened in the Back Bay in 2004. Financial services companies Northern Trust and Bank of New York recently set up new offices here to serve the wealthy, while Bank of America Corp. moved its global wealth and investment management division to Boston.
(Excerpt) Read more at boston.com ...
How do they hide it?
That explains a lot...the white liberal guilt must be off the charts in Boston...
Indeed it is. Some of the zip codes mentioned in this article have very high Democrat voting tendencies, particularly for federal office... although it should be said that a few other well-off suburbs are about the only part of the state that vote regularly Republican, along with Springfield's suburbs and a few towns in the middle of the state.
When the average house costs $500,000, you will get a large portion of that million just by hanging on to your house and riding the equity wave.
My thought exactly. These are "net worth" millionaire households, right? So that means that the FMV of your residence is counted--a value that is theoretical. IF there is a residential RE bubble, and IF it bursts, I suspect the number of "millionaires" will drop precipitously.
They bought Bank Boston or whatever BayBank turned into. They are definitely catering to the old wealthy geezers in the suburbs. You know, the people who whine about spending $20 a presription but have $500k in savings and owe nothing on their million dollar house. Like to have their egos stroked so BoA has greeters trained to remember names.
Another thing that happens is that house you bought a few years ago for $150,000 on Boston's south shore will now sell for $300,000 plus.
Retired people will sell, pay off the small mortgage(if they even have one) and head south or west with a bundle of cash to the warmer weather and much cheaper housing. And have plenty of money left over to put in the bank or other use.
You don't gain anything by selling and then buying locally since you will pay through the nose for another house in the same town. - Tom
Yes, I'm lucky I bought before the boom began but I'm also paralyzed because trading up means a much bigger mortgage.
First of all,the assumption that the typical house in the areas mentioned is $500K is incorrect.Anything bigger than a gargle in any of these towns will go for a million or more.
As for the real estate bubble,Boston is seen as one of the most overheated,overvalued markets in the country.Add to that the fact that Greater Boston represents at least 66% of the states population and that Massachusetts is one of three states that is *losing* population and I think it's safe to say that in a few years there'll be far fewer millionaires in the Boston area.
Whew, Kerry just made it in considering he's part of a millionaire's household.
If one figures housing equity as part of a retirement plan, make sure it's the housing portion of the retirement plan so that as the market rises or falls your investment and future purchase plan will rise or fall together.
Where are you located if I may ask? In the towns/areas specifically mentioned on the map that goes with this piece, colonials start at a million.For example,the house in which I grew up (in Waban) is now assessed by the City of Newton for 1.1 million,which means that it could sell for at least 1.3 This house,while nice and located in a very nice neighborhood,is anything but luxurious!
My Dad paid $34K for that house in the late 50's.
One in twenty in Boston are millionaires...and 19 out of those twenty are democrats.
The valuation is supposed to approximate market value, and with the hot RE market of the last few years, the tax man has done exactly that. The other way, practiced in a number of the well-off suburbs, is to pass over-rides for the "emergency" budget items that seem to crop up more often than not. They usually pass: "Its for the schools -- its for the children and it keeps our property values up." Maybe so, but more efficient use of funds doesn't seem to ever be the preferred solution.
With the state's population on the decline, there are less people to pay taxes. The natural trend will be for taxes to continue to escalate, compounding and increasing the exodus.