Rent prices have been on the decline in Greater Boston since March of 2020. Demand for apartments was severely hampered by remote learning and a diminished student population, sending prices for apartments plunging as high as 21% in Downtown. The reality is these severe rent drops have been more or less concentrated to a few neighborhoods in Boston. Overall in Boston, the average rent for an apartment has dropped 4.51% year-over-year.
This points to an interesting shift in demand that has occurred over the past year in Boston’s housing market. Demand shifted from renting to buying amid record low interest rates. Demand also shifted from the typical high-demand neighborhoods near Downtown and local Universities to areas out in the suburbs.
This shifting demand trend becomes clear when you look at the only 5 neighborhoods where rent has increased over the past year. Areas that used to generate moderate or lighter demand became very popular, while demand for apartments in the dense city centers gave way to more people looking for open spaces amid the global pandemic.
This trend will definitely lose steam in 2021 as Universities resume in-class learning and remote work is phased out as more of Boston’s professional population gets vaccinated. But it would be foolish to think that it will reverse course completely and restore the rental market to its pre-COVID levels. The extent to which this trend will slow will be a very interesting to see, with mobility of international students, vaccine policies, and public opinion all up in the air still.
But without further ado, here are five neighborhoods in Greater Boston where rent prices actually increased over the past year.
Average Rent Price: $2,320
YOY Change: +32.73%
Arlington has long been considered one of the best Suburbs in Boston to live. Located further from local Universities, demand for Arlington apartments has remained relatively steady historically compared to the cyclical movement of Boston’s apartment demand. While Arlington hasn’t been spared from the excess apartment supply over the past year (Arlignton’s vacancy rate has increased by 231% YOY), it’s current vacancy rate of 2.55% is still lower than the average of all Boston suburbs currently (2.85%).
Arlington Studio Avg. Rent Price: $1,573
Arlington 1BR Avg. Rent Price: $1,809
Arlington 2BR Avg. Rent Price: $2,314
Arlington 3BR Avg. Rent Price: $2,836
Arlington 4BR Avg. Rent Price: $3,050
Average Rent Price: $2,521
YOY Change: +9.14%
Roslindale has been a great example of the demand shift in Boston. This neighborhood lies on the border of Boston’s city limits, and historically it has not been difficult to renters to find available Roslindale apartments. That has changed over the past 12 months. Out of all neighborhoods in Greater Boston, suburbs included, only 3 neighborhoods including Roslindale saw a decrease in apartment inventory since May 2020. Vacant inventory went down by -19.57% in Roslindale over that time span, the second highest decrease in apartment supply behind the next neighborhood on our list.
Roslindale Studio Avg. Rent Price: N/A
Roslindale 1BR Avg. Rent Price: $1,783
Roslindale 2BR Avg. Rent Price: $2,347
Roslindale 3BR Avg. Rent Price: $2,695
Roslindale 4BR Avg. Rent Price: $3,148
Average Rent Price: $2,119
YOY Change: +2.45%
Chelsea’s apartment rental market has been another strong performer over the past 12 months. It’s location just north of the city makes it one of the best places to live and commute to Boston, providing a safe haven for students and professionals looking to escape the density of Downtown during the pandemic. As a result, vacant inventory of Chelsea apartments actually decreased by -49.86% over the past 12 months, the largest drop in inventory of any neighborhood in the Boston metro area.
Chelsea Studio Avg. Rent Price: $1,638
Chelsea 1BR Avg. Rent Price: $1,647
Chelsea 2BR Avg. Rent Price: $2,119
Chelsea 3BR Avg. Rent Price: $2,590
Chelsea 4BR Avg. Rent Price: $3,264
Average Rent Price: $2,162
YOY Change: +1.74%
It’s not secret that Dorchester has been slowly gentrifying in recent years, and that trend accelerated over the past year. It’s also no secret that there is a severe affordable housing shortage in Boston, and Dorchester provides relief to renters escaping the soaring rent prices in other parts of town. As a result, the vacancy rate for Dorchester apartments increased by a relatively small +34.28% year-over-year compared to the City’s YOY supply increase of +144.74%. This did push up rent prices, albeit by a marginal 1.74% since last year.
Dorchester Studio Avg. Rent Price: $1,019
Dorchester 1BR Avg. Rent Price: $1,724
Dorchester 2BR Avg. Rent Price: $2,155
Dorchester 3BR Avg. Rent Price: $2,606
Dorchester 4BR Avg. Rent Price: $2,983
Average Rent Price: $2,143
YOY Change: +0.91%
Last on our list is Medford, the only other neighborhood in Boston where rent went up over the past 12 months. Medford apartments are known to be favorites for Tufts students, however they managed to escape the worst of it compared to other students enclaves like Somerville, Cambridge and Allston. Apartment vacancies went up +52.46% in Medford YOY, possibly due to working professionals moving out of Downtown into the Burbs for remote work. Rent prices remained pretty steady over the past year, with average rent increasing by less than a percentage point.
Medford Studio Avg. Rent Price: $1,473
Medford 1BR Avg. Rent Price: $1,544
Medford 2BR Avg. Rent Price: $2,139
Medford 3BR Avg. Rent Price: $2,747
Medford 4BR Avg. Rent Price: $3,453
So there you have it. Out of the 43 neighborhoods in Boston’s metro, only 5 saw rent prices go up in the past year. The pandemic proved itself a worthy adversary to the local housing economy, stopping the red hot Boston apartment rental market dead in its tracks. This cool-down is not likely to last, as remote learning has been relegated for Fall 2021 and we’re already seeing demand being restored in some of our Downtown neighborhoods.
Still, renters will find better deals this year than they have in years past as a result of the excess supply. Landlords have been flexible with lease agreements, allowing for subletting clauses, reduced move-in fees, and incentives such as free parking. The deals will likely last until June when the off-campus housing rush comes into full swing. We’ll continue to monitor this trend as it continues.