Boston Multifamily Report – February 2024
Price per unit is improving in the high-performing market.
Boston’s multifamily fundamentals proved resilient throughout 2023, with rent growth ending the year at 3.0 percent, while the national rate inched up just 0.3 percent. The metro remained one of the country’s tightest rental markets, with the occupancy rate in stabilized properties at 96.5 percent in November, following a minor 10-basis-point decline over 12 months.
Job gains remained on a moderating trend in 2023, expanding 2.4 percent in the 12 months ending in October, or 80,500 net jobs, slightly ahead of the 2.3 percent national rate. Reflecting a tight market, Boston’s unemployment rate stood at 2.7 percent in November, marking a 90-basis-point improvement since January. The metro outperformed the U.S. (3.7 percent) and the state (2.9 percent), according to data from the Bureau of Labor Statistics. Two sectors lost positions in the 12 months ending in October 2023—information (-1,400 jobs) and manufacturing (-100 jobs). Meanwhile, gains were led by the metro’s largest sectors: education and health services (27,300 jobs) and professional and business services (12,700 jobs).
Deliveries fell to the lowest volume in a decade, with only 5,405 units coming online in 2023. As of December, developers had 18,416 units under construction, with starts picking up. Meanwhile, investors traded $2.2 billion in multifamily assets in 2023. The price per unit rose 12 percent year-over-year, to $417,852, more than double the $185,172 U.S. figure.
