Double-whammy for Gateway Cities

Municipalities are caught in vicious real estate cycle

CLARK UNIVERSITY IN WORCESTER this week unveiled a series of new data profiles suggesting Gateway Cities  are being hit with a real estate double-whammy: housing prices that are relatively low and rents that are relatively high.

That combination is trouble because it means developers have little incentive to build new housing units in Gateway Cities and existing landlords can charge more for the units they rent out. The result: low-income renters end up paying a disproportionate amount of their income for housing. It’s a vicious cycle that shows no sign of abating on its own.

Gateway Cities are medium-sized communities outside of Boston that are struggling to regain their economic footing. Originally there were 11 Gateway Cities, including New Bedford, Fall River, Worcester, Springfield, and Lowell. As Gateway Cities garnered more attention from state officials, the group expanded to 27 cities. As defined by state law, a Gateway City must have a population between 35,000 and 250,000, an income level below the state median, and a share of residents with a bachelor’s degree or higher below the state average. Real estate problems have become a defining characteristic of Gateway Cities.

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