The apartment supply issues being faced by many Boston neighborhoods has been well documented over the past year. Allston and other neighborhoods near local Universities have been plagued by apartment vacancies as a result of remote learning policies being instituted at local schools. Interestingly enough, prior to February of this year, the Allston apartment rental market seemed to be holding steady in terms of vacancies compared to other popular student enclaves in Boston like Fenway and Mission Hill.
That all changed over the past 7 weeks, as the real-time availability rate for Allston apartments shot up to an unthinkable 27.4%, making it the highest availability rate of any Boston neighborhood. That means more than 1 out of every 4 apartments in Allston is available for rent, either now or in the future. That figure is up from an uncharacteristically low 9.9% at the end of January this year, a massive 176% jump in less than 2 months.
Curiously enough, supply concerns in Fenway and Mission Hill have been going on since summer of last year, when existing student leases ended without new students coming in to fill them. Both areas have been subject to instability and wild fluctuations in vacancy rates during that time span, while Allston seemed to be insulated from the trend despite it’s huge student population.
Comparing Vacancy Rates and Availability Rates in Allston
Mission Hill’s apartment availability has begun to show sings of stabilization over the past few months, while Fenway’s availability is still sky high. In Allston, the current apartment vacancy rate of 7.05% is only 2 percentage points higher than that of the city-wide availability rate (5.07%). However, that number puts Allston as the 4th highest vacancy rate in Boston behind North End (8.43%), Fenway (9.5%), and Downtown Boston (23.84%).
While the vacancy rate is a good indicator of current rental market conditions, the availability rate gives us an even better predictor of future conditions. It tells how quickly new apartment inventory is being absorbed in the current market. hen availability rate is high, it usually indicates that vacancies are on their way up too.
However, this is a unique circumstance given that the market conditions aren’t being created by normal socioeconomic factors. Remote learning policies still have not been made clear for the fall semester, but many believe it will be at least scaled down. Students are holding out on signing leases until policies are made clear. If remote learning is scaled down for this fall, expect a huge leasing rally during the summer and these inflated numbers to come back down to earth at least partially.
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