Last month, as Mayor Wu and city officials met with dozens of people who were able to become first-time homeowners in Boston by receiving financial assistance from the city, she said, “I’m thrilled to celebrate these new homeowners and the transformative impact of the City of Boston’s home buying programs in building generational wealth and equity across our city.”

Throughout Wu’s administration, 678 people, a majority of whom are people of color, became homeowners for the first time because of the city’s programs, including 235 families in 2024 alone.

Dorchester was the busiest neighborhood where buyers decided to close on a new home this year. Roxbury, Hyde Park, and Mattapan were also popular areas for new owners.

The First-Time Homebuyer Program is the city’s flagship initiative. It provides eligible buyers a grant of 5 percent of the purchase price, up to $50,000, toward a down payment. Since 2022, the program has provided over $16.8 million in support to those 678 families, according to Alexander Sturke, a spokesperson in the Mayor’s Office of Housing.

The assistance was previously only 1.5% of the housing cost, and it was given as a deferred loan, not a grant. The changes, said Sturke, have “increased equity and security” for new buyers.

ONE+Boston is another program aimed at making homeownership a reality for more residents. In addition to providing down payment assistance, it offers access to discounted, fixed 30-year mortgage rates. To be eligible, residents must meet a list of requirements, including being below an income limit, which was $163,200 for a family of four. A total of 481 people have benefited from ONE+Boston, said Sturke.

However, across the backdrop of these celebrations lies a stark reality: the cost of owning a home in Boston has soared in the past five years, as home prices and mortgage rates have significantly risen, according to a new report by Oxford Economics, an economic advisory firm.

In 2019, a household needed an annual income of about $104,000 to buy the median priced single-family home in the city. Today, a family needs roughly $194,000 to afford to buy the same home, an increase of 86 percent.

The analysis not only took into account the price of houses but also the cost of property taxes and homeowners’ insurance to calculate the salary necessary for housing costs.

The report also ranked Boston as the 11th least affordable metro in the country, with San Jose being the least affordable. The average family needs an annual salary of $108,000 to buy a home in the country, which is almost half of the income required to own a home in Boston.

In the third quarter of 2019, about 46 percent of families could afford the median housing costs in the city, the report estimated. The drop has been dramatic over the past five years. The report estimated that only about a quarter of households now earn the income required to afford a home within the city.

The main driver of eroding affordability across the country, according to the report, is high mortgage rates. Over the last five years, they have nearly doubled, from 3.7 percent to 6.5 percent. Although property taxes, housing insurance, and house prices all increased, mortgage rates rose disproportionately higher than the other factors.

Barbara Denham, the report’s lead economists, explained that housing costs will not improve until mortgage rates “fall appreciably.”

Sturke, the Housing Office spokesperson, added that limited available land and high construction costs also drive up prices for first-time buyers. The report’s findings, he said, “underscore the need for policies that both increase the supply of housing and make it more affordable to households with a range of incomes.”

Gustavo Quiroga, executive director of LISC Massachusetts, which supports community development initiatives in the state, agreed that there’s a lack of housing, but he emphasized that sale prices are driven up mainly by a shortage of homes available for sale. “Most new housing built in Boston is rental apartments,” Quiroga said.

Many of the ways to address the issue are related to changing zoning regulations, believes Quiroga, so that it’s possible to build more homes in all neighborhoods.

For an example, Quiroga suggested that the mayor implement new zoning to allow more housing within the Main Street business districts. It would “create more housing that people working in our local businesses can easily access and add more customers within walking distances to those businesses,” he said.

Another proposal was recommended by the Boston Foundation in its annual housing report on the Boston area. Their findings showed that if 5 percent of the region’s public, vacant, and non-conservation land was developed, then it could accommodate 85,000 units of housing.

In a statement, Ted McEnroe, the organization’s spokesperson, said, “The best way to improve homeowner affordability in Greater Boston is to build hundreds of thousands of new homes so that demand doesn’t continue to far outpace supply.”

He added, “The ongoing efforts to increase supply and reform zoning will take years to yield results. In the meantime, programs like state and city down-payment assistance are proving effective at giving first-generation homebuyers broader opportunities to buy in today’s out-of-balance market.”

The Oxford Economics report on housing affordability concluded with a forecast. It estimated that housing costs will “rise moderately again” in the first three months of 2025, pushing homeownership further out of reach of residents.