An art installation at Lawrence’s Everett Mill in 2023. The state’s mid-sized cities need more supports for homeownership development and small businesses. iStock photo
Our state’s mid-sized cities are full of people, many of them immigrants or children of immigrants, who came to buy homes, start businesses or just get their feet under them.
The concept of Gateway Cities derives from the notion that these communities serve as launching pads for families to obtain a better life, a pursuit of happiness that has often been called the American dream.
Gateway Cities, with 25 percent of the state’s population, a disproportionate number of its low-income households and over half of the state’s non-white residents, remain the tip of the spear in determining whether our state can make good on that dream.
Understanding the economic health of Gateway Cities can be challenging. Data lags the pace of whiplashing federal policy changes. And the 26 municipalities have already experienced different trajectories and uneven growth over the last 10 years. However, we can identify both some encouraging trends and areas of concern.
Community-Wide Indicators Trend Positive
There are signs that these communities, as a whole, have continued to stabilize and revitalize. The share of Gateway City neighborhoods with concentrated poverty fell from 22 percent in 2013 to just 11 percent in 2023, while high-vacancy census tracts decreased moderately from 8.1 percent to 6.8 percent over the same time period.
Communities also appear to be more stable, with less short-term churn among residents – good news for local schools – as the share of census tracts where more than one-fifth of residents had moved within the past 12 months fell from 25 percent in 2013 to 10 percent in 2023.
Homeowners of color, while still trailing their white counterparts, are purchasing homes at higher rates in Gateway Cities than in the rest of the state.
Interestingly, Gateway Cities have grown faster than their surrounding communities, even as those suburbs stepped up to build more affordable housing units. While housing permits in Greater Boston and the state as a whole have been trending downward, multifamily permits increased by 30 percent in Gateway Cities from 2022 to 2024.
Families Face Threats to Upward Mobility
Even as many neighborhoods show indicators of better health, families face the squeeze.
The median household should make $40,000 more to comfortably afford the median rent in their community. Rental vacancy rates remain under 3 percent, meaning that landlords continue to push the limits of what the market can bear.
Meanwhile, home sale prices finally leveled off, rising only 1 percent from 2024 to 2025, but they remain historically high and only 20 percent of Gateway City residents can afford the median home in their community.
Disconcertingly, homeownership rates declined in 9 of the 26 Gateways, and in every one of those cities, the absolute number of homeowners also fell, which means that at least some owner-occupied housing became rentals.
And cities in Western Massachusetts continue to lag the rest of the state on almost every indicator.
André Leroux
Wealth-Building Strategies Needed
Two key pathways for families to achieve the American dream remain neglected: homeownership and entrepreneurship.
MassINC’s 2025 Gateway Cities Housing Monitor recommends increasing the supply of for-sale housing and not just rental units. Homeownership units face only a $64,000 financing gap compared to the $212,000 needed to make the numbers work for rentals. And fewer units will be needed to stabilize the for-sale market at a healthy vacancy rate.
That same report discovered that less than 5 percent of all the units we’re building across these cities are two- to eight-unit properties – truly the “missing middle.” These are the properties that Gateway Cities built 100 years ago to lift us out of a different housing crisis. We need to help more residents become owner-occupants of these buildings with focused down payment and renovation assistance, and also make it easier to build new stock by-right.
But we cannot forget the jobs side of the equation. The commonwealth still lacks a coherent place-based strategy to support local commercial areas.
The Retailers Association of Massachusetts released a survey last year showing that over half of respondents expect to go out of business within five years. This astounding number should be an alarm bell for the commonwealth. We need the state to invest a portion of online sales tax collections into establishing district management entities that can help small business districts thrive.
The state should work comprehensively with Gateway City local governments to streamline small business permitting systems. MassDevelopment or other agencies could help develop a toolkit that helps these municipalities promote their regional competitive advantages while addressing their challenges. Gateway Cities have made progress, but it’s time to finish the job.
André Leroux directs the Gateway Cities Innovation Institute at the MassINC Policy Center.
