Gas prices shot up 73 percent in 1973, the year OPEC lowered the boom on the U.S. economy. Pumps went dry and irate drivers queued up in long lines at service stations; some resorted to stealing precious fuel from their neighbors’ cars at night.

No business reporter in their right mind would have looked at those soaring gas prices and the long lines at gas station and have written a story on the “red-hot” oil market.

Fast forward to 2018, and home prices in the Boston area and across the country are reaching record highs.

Do a search on Google News of stories with the words “hot” and “real estate market,” and you’ll get bombarded with dozens of pieces about rising home prices in Boston and in cities across the country.

And I have to confess that I have carelessly bandied about the word more times than I care to admit during two decades of covering the real estate market in Boston.

Like the oil embargo of 1973 that sent gas prices racing upward, there is no real mystery why this is happening: the number of homes for sale has been falling across the country and has hit record lows in Massachusetts.

It’s time to put a moratorium on the use of “hot” as an adjective for the real estate market. Frankly, “inventory-starved” or even “dysfunctional” would be a more accurate descriptor of what’s happening right now in the Greater Boston real estate market.

The problem with using the word “hot” to describe the current state of affairs in the real estate market is that it puts a thoughtless and undeservedly positive spin on a growing epidemic of housing unaffordability, one of the most really serious issues plaguing the U.S. economy and American society as a whole.

A hot market implies high demand. It conjures up homebuilders racing to keep up as buyers snap up new inventory faster than it can be put on the market. Or of home sellers scrambling to take advantage of high prices so they can go out and buy a new and larger home themselves.

Yet while every other real estate story talks about the hot market, the reality is there is no way of truly knowing how deep real estate demand is right now in the Boston area.

Scott Van Voorhis

Anti-Housing Culture Prevents New Development

Local NIMBY building restrictions have put a stranglehold on new housing construction in Greater Boston for decades. As a result, housing developers in Greater Boston, unlike most other business people, are no longer able to ramp up production in response to market conditions.

Demand has been outstripping our artificially capped supply of new homes for years in the Boston area, driving home prices ever higher.

The median price of a home in Massachusetts recently crossed into record territory, hitting $402,000 in August, up 5.8 percent over last year, according to The Warren Group, publisher of

Banker & Tradesman. The median sale price of a single-family home in the state has been over $400,000 for three consecutive months – an unheard-of record high.

However, a look back at new home and apartment construction decades ago offers some clues as what a truly hot real estate market might look like.

Back in the 1980s, tens of thousands of new homes and apartments were built every year in Massachusetts, making it roughly average in terms of new housing construction in the U.S. That’s 30,000, even 40,000 new homes, condos and rental units a year.

Fast forward 30 years: Boston is far richer, with a booming economy and a rising population, compared to the 1980s, when the region was just starting to emerge from a decades-long slump.

Yet developers took out building permits for a grand total of 17,230 new homes and apartments in 2017, a number that is actually a significant improvement over first few years following the Great Recession.

Builders would probably have built a lot more homes and condos – and sold them all – but for the anti-housing culture that dominates the suburbs of Greater Boston.

Fewer homes getting built, in turn, have resulted in a dramatic drop in the number listings on the market. There were 38,000 homes for sale across Massachusetts in September 2006. This August, that number had dropped to a pathetic 14,597. That is the lowest number of homes for sale in August since the Massachusetts Association of Realtors began tracking that number.

Inventory, or homes on the market, has fallen in 78 of the last 79 months.

Dysfunctional, inventory-starved, miserable, or just plain messed up – have your pick of adjectives.

But “hot” is one thing the Greater Boston real estate market right now is not.

Scott Van Voorhis is Banker & Tradesman’s columnist; opinions expressed are his own. He may be reached at sbvanvoorhis@hotmail.com.