Massachusetts is full of history and is famous for its port towns located along the Atlantic coast. So, owning land in Massachusetts, what are the pros and cons?
The state of Massachusetts is split up into many different regions like the Greater Boston area, Cape Cod, Marthas’s Vineyard, Nantucket Island, Bristol and Plymouth County, and the Berkshires, among a few others. Depending on where you are looking to purchase and own land, you may be looking at a small fortune to acquire the land purchase, especially in places like Martha’s Vinyard and Nantucket Island. That being said, there are still many places in Massachusetts where land may be more affordable. So, for people who own land in Massachusetts or who are thinking about purchasing land, what have they found to be some of the advantages and disadvantages of their efforts?
Many people who purchase and own land in Massachusetts find that some of the main advantages include that the land makes a great investment that can bring a profit, provide rental income, or become an asset to pass on. One of the main disadvantages is that land in Massachusetts can be expensive.
Massachusetts is a state with much potential for purchasing land as an investment, however, the barrier to entry can be quite high for many Americans. Land purchase prices, the cost of living, and taxes can take a toll on anyone’s savings and income, even individuals and families who may be considered upper-middle-class or somewhat wealthy. It is not cheap to purchase land and to live in Massachusetts, however, some of the benefits that the state can offer in terms of education, health care, public safety, and infrastructure, for some people, are well worth the extra cost for a much better quality of life than many other places in the United States.
Let us take a deep dive into many of the advantages and disadvantages of purchasing and owning land in Massachuttes as well as some of the main reasons and attractions that bring people to the state whether as tourists or as residents.
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What are the advantages of owning land in Massachusetts?
Massachusetts is home to almost 7 million people who have chosen to spend their lives, get their education, advance their careers, and raise their families in a place with quality schools, health care, public safety, and reliable infrastructure. As someone who may be looking for land either as a place to live, retire or as an investment opportunity, Massachusetts has a lot to offer.
Let us look at some of the main advantages of purchasing and owning land in Massachusetts.
Excellent investment opportunity
Although purchasing land in Massachusetts can be expensive, it is important to note that the value of the land is likely to hold if not increase in the long run. Massachusetts has one of the best economies, a thriving tourism industry, and many other appealing factors that make the state an attractive state to live in and visit. Purchasing land to build a home or to start a business would be a wise investment for those who can afford to do so.
Best areas of Massachusetts for investment properties
If you are looking to purchase an investment property with the purpose of renting it out to provide some monthly rental income and to possess an asset that will hopefully someday bring in a large profit, then there are some areas of Massachusetts that you may want to consider. Of course, you have the greater Boston area, but you also have the communities in and around Worcester, Leominster, and Mashpee.
- Boston: Aside from having a strong industrial sector, a well-educated population, and a strong workforce, Boston has continuously been recognized as an epicenter of tech startups in the last decade or so. Many people end up in Boston at one of the many internationally recognized colleges or universities, and when they graduate, they often do not have to leave the city to find quality employment opportunities with good salaries and benefits. This constant flow of college students, young professionals, and eventual lifers help to make Boston one of the best rental markets in the country for investment properties.
- Worcester: After the pandemic, large real estate developers started pouring hundreds of millions of dollars into the Worcester area building large upscale and luxury apartment complexes and condos. The quality of the public schools, excellent public transportation, and easy access to recreational activities make Worcester an attractive place for young professionals and people looking for starter homes to start their families.
- Leominister: Leominster may be more of a gamble, however, with big risk comes big reward. More and more Leominister keeps coming up in chatter among real estate professionals as the next big market to take off in Massachusetts.
- Mashpee: If you are looking for a place to purchase a vacation or retirement home, or seasonal rental property, then Mashpee located on the Cape may be a good place to start looking for some underpriced older homes that may need a little bit of updating and renovation but that can provide some long-term return on your investment.
Because Massachusetts is a place of such historical significance and because of the immense beauty the state offers in the form of coastline, beaches, islands, rivers, dense forests, and intense autumn foliage, Massachusetts brings in tourists from all over the US and the rest of the world. This constant flow of tourism, especially during the summer and fall, makes owning property in Massachusetts potentially lucrative for anyone looking to start a small business.
In 2019 - pre-pandemic, Massachusetts was host to over 26.8 million domestic tourists, over 2.5 million international visitors, and 650,000 Canadian tourists. As tourism starts to gain traction again after the pandemic, tourism will again be on the rise and all of these tourists will be looking for a place to stay. Maybe you would like to purchase a beach house on Cape Cod or Nantucket Island to rent seasonally, or maybe you would like to open a Bed and Breakfast in the Berkshires, whatever you choose to do, you should have no shortage of tourists to attract to your locale.
Great infrastructure and public services
Massachusetts is a state that may have higher taxes, but they also have some of the best schools, hospitals, emergency services, public transportation, and infrastructure in the nation. Many people find when they move to Massachusetts that they have access to a much higher quality of life than in other states. Massachusetts, as a state, believes in supporting industry but also in investing in the people who live, work, and thrive within its borders. Boston alone boasts some of the most expansive and available public transportation systems anywhere between its subway system, bus routes, and ferry schedules.
The police, firefighters, and ambulance services are well funded and responsive all throughout the state. Massachusetts ranks 46th when it comes to the number of murders and violent crimes per 100,000 residents with 2.3 per 100,000. This makes it the 5th safest state in the nation behind only Idaho, Vermont, Maine, and New Hampshire.
When it comes to the public school system in Massachusetts, it is not surprising that it ranks either #1 or #2 year after year in terms of public school options and best overall math and reading scores. Also, when it comes to school safety, Massachusetts also takes the crow for having the lowest percentage of students injured or threatened.
What are the disadvantages of owning land in Massachusetts?
The main disadvantages of living and owning land in Massachusetts are higher taxes and a high cost of living. Some places in Massachusetts can be quite expensive to purchase land, pay utilities, build a home, or even get groceries and pay for gas. Higher costs of living and higher home prices could potentially be a good thing or a bad thing depending on your situation.
Higher cost of living
If you are moving to Massachusetts to retire and you are on a fixed income, then it may be difficult to keep up with the rising costs of living in Boston or any of the more popular destinations around the state. For example, in Boston, the median home price is $667,000 and the cost of living is much higher than the national average in almost every category. The one exception is healthcare. Healthcare costs in Boston are almost 11% below the national average. However, food, utilities, transportation, rent, and almost everything else costs well above the national average. So how could this be a good thing?
If you are looking to purchase an investment property in Boston or another budding community in Massachutess, then the initial purchase may be quite a large expense. However, the higher cost of living and increasing rent prices may be enough to make your investment quite profitable. This is especially true if you are living in an area with a much lower cost of living but you're simply renting your investment property and paying a property management company to collect rent, attend to calls and repairs, and find renters.
Massachusetts has much higher taxes than much of the country. When it comes to property tax, they are pretty much smack in the middle of all 50 states and the District of Columbia, however, since the median price of homes is much higher than average, a lot of revenue is generated through property taxes without needing a higher rate. Also, there is a 5% state tax on both earned and unearned income and a minimum of 12% tax on capital gains. Additionally, there is a 6.25% state sales tax that does not include any additional local sales taxes that certain municipalities may tack on as well. Although taxes are higher in Massachusetts, residents seem to be happy with the schools, hospitals, emergency services, public transportation, and clean air and water that their tax dollars work to help provide.
About THE AUTHOR
We loved family’s outdoor adventures so much we started a land business just to help others buy their own land. We’ve sold to dozens of people from ATV weekend warriors to camping enthusiasts to retired truck drivers. Our inventory spans five western states. We’ve been trained by experience, land acquisition courses, and hundreds of hours meeting with county assessors and clerks, zoning officials, realtors, and land investors. We’ve answered hundreds of questions from people regarding the buying and use of land.Read More About Brittany Melling