Boston Multifamily Report – Summer 2021
While displaying a relatively slow recovery, the metro's rental market is showing promising signs.
While not out of the woods yet, Boston showed promising signs at the start of the second quarter. Following 18 months of negative performance, the average rent rose 0.4 percent on a trailing three-month basis through April, to $2,258. The substantial supply expansion pushed down the occupancy rate in stabilized properties by 120 basis points in the 12 months ending in March, to 94.5 percent.
Boston’s strict safety measures during the health crisis helped it manage the outbreak relatively well, but took a toll on the economy, which mirrored the situation in other large coastal markets. Even though unemployment dropped to 5.9 percent in February, the employment market posted a 9.3 percent decline over 12 months, trailing the -7.2 percent national rate. All sectors lost jobs during the period, but several high-profile projects show promising signs: IQHQ’s $1 billion Fenway Center life sciences campus is set to bolster an already burgeoning Boston staple, while Amazon announced an expansion of its tech operations in the Seaport District, expected to add 3,000 jobs over the next few years.
Developers delivered 1,053 units this year through April and had another 18,708 units underway, following the busiest year of the decade. Meanwhile, transaction activity picked up, totaling $567 million for the first four months of the year, but the per-unit price marked a 10.9 percent dip.