The magazine, which went on sale yesterday, scored Essex County at No. 1, saying it has the highest cost of living, lowest salaries, least job growth and least affordable housing.
These combined factors placed Essex County as the "most overpriced place to live," despite its median home price of $373,750, according to the article. In comparison, San Francisco ranked No. 2 and has a median home price of $720,400; San Jose, Calif., is the third most overpriced at $746,800; and Honolulu comes in at No. 4 with $625,000.
Tricia White, real estate agent with Century 21 North Shore, which serves all of Essex County, said she does come across some mind-boggling prices around here - like the $10 million mansion for sale in Manchester-by-the-Sea or a house priced in the $3 million range in the Beverly Farms area.
But compared to other places in the country, she finds it hard to believe that Essex County has the dubious honor of being at the top of the heap when it comes to overpriced digs.
"We have someone in the office who came back from California with house listings where a two-bedroom bungalow was $900,000 because it had a water view," White said. "You don't see prices that high for something comparable around here."
Jim Armstrong's Salem-based real estate agency shows houses all over the state and in New Hampshire. He said prices for houses along the Route 128/MetroWest belt are, on average, 10 percent more expensive than the homes he sells in Essex County. He also disagrees with the $373,750 figure Forbes uses for the median home price for this area.
"Prices right now are more in the low $330,000s or $340,000s on average," Armstrong said. "Compared to other places, is it more expensive? Yes. My brother just bought a cape on a half-acre of land in Gardner for $149,000, but he owns his own business and can live way out there.
"Here it's more expensive, but it's reasonable considering all the amenities. I'm just baffled that we're considered overpriced compared to San Francisco," Armstrong said.
The concept of living in the nation's most overpriced region seemed to shake Senate Majority Leader Fred Berry, D-Peabody.
"I'm shocked," he said - only half-seriously. "But especially in my district, which is the heart of the county - I think we consider ourselves blue-collar."
Without saying it's overpriced, the senator doesn't deny the cost of housing is a real problem, particularly for poor and middle-income people. He cites his experiences at a nearby teaching hospital where none of the graduating obstetrician gynecologists
planned to stay in the area because of it.
On the other hand, an optimistic Berry sees change coming.
"The housing market is saturated," he said. "But in the last five or six years, there's been a lot of building."
The state's 40B law, which Berry has supported despite vocal opposition, has helped get houses, condos and apartments built by allowing developers to bypass local zoning in exchange for including "affordable" units.
The Forbes story caused Salem Chamber of Commerce Director Rinus Oosthoek to pause.
"I'm surprised," he said. "It's worrying because it's one more story about the fact that the cost of living is high here. .. It shows we need to address some issues about the high cost of living when you come up on a list like this."
He wonders if it might be necessary to encourage higher density.
Salem City Councilor Lucy Corchado is worried, Berry's efforts notwithstanding. Just as Forbes indicates, she fears that much of the new housing is pegged for the rich.
"In Salem, we have luxury condos for $400,000 plus," she said. "It's created for that upper-class echelon - that's certainly not the working-class rate."
The high prices have hit hard on families. Corchado knows some that have left the area.
"I'm not surprised," said recently retired Realtor Diane St. Laurent of Marblehead. "I knew this was coming. ... I know that people are moving out of Massachusetts. Their income and the cost of living do not mesh. As housing costs went up, the incomes didn't match."
And those who moved away may think twice about trying to come back, if they get homesick.
White and Armstrong agree that many people from out of state suffer from what Armstrong calls "sticker shock" when they see how much a house costs in Essex County, and many former residents find they can't return to their hometowns.
"I have people from the Midwest who lived here 20 years ago and want to come back but can't afford to," White said.
The rise in housing costs was so sharp, St. Laurent expects a correction now.
"It's a cycle," she said.
The mania for building massive homes, even knocking down smaller ones to make way, has ended, she said.
But calling Essex County overpriced grates a little. St. Laurent has relatives across the country, and she hasn't seen many locations to compare with coastal New England.
"And when you think about what we have here," she said. "Boston has incredible medical facilities. Incredible. With Harvard and MIT, there are some of the best schools in the country."
As a real estate agent, she knows the strong points of towns like Marblehead, Beverly, Swampscott and Salem.
"It's real easy to sell this area," St. Laurent said.
And it may get easier, still: White said that home prices are coming down because too many houses have been remaining on the market for six months or longer. In her real estate office, she saw one home sell for $100,000 less than the original asking price, she said.
"That was the only way they could move the house," White said. "There's too much inventory now with high prices, and sellers need to change their mind-set from two years ago when prices were high and you had multiple bidders. It's not like that anymore."
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