August is here and we hope you have been enjoying the wonderful weather and some outdoor time at home, on the Cape, or wherever you may be! This month, Nick takes a look at the Boston rental market and the changes being seen over the past few months. He also gives tips on how you can enjoy these wonderful summer days!
Over the past few months, we have seen some shifts in the rental market in and around Boston, can you talk a bit about this?
The rental market here in Boston has taken a significant hit over the past few months. As of today (August 17th) we have 4740 units currently on the market vs 1807 at the same time last year (per MLS). This is an increase of 162.31%! We now have 6.41 months of supply just sitting there vs 2.33 last year.
Two major factors in the increase in inventory are the changes in the laws regulating Airbnb and obviously the pandemic which hit us in February/March.
Airbnb Regulation Changes
Just recently, landlords who previously rented their units on Airbnb have become subject to much stricter regulations causing thousands of these units to switch from Airbnb style rentals to regular rentals all at once. In fact, the stats show that we’ve seen 3729 more units become available for rent YTD vs. the same time last year, a rise of 36.22%.
In my opinion, that the pandemic is contributing to the massive rise in inventory currently on the market due to the following factors:
- Many local colleges are going virtual thus leaving much of the student apartment inventory vacant.
- Hiring for many companies has temporarily slowed or stopped.
- Uncertainty in the job market has caused some people to become more conservative and choose not to move to a new apartment.
- After being forced to work from home, many renters who currently live in the city have decided to move to the suburbs sooner than they had originally planned to gain more space.
How do you expect these trends to go through the end of the year and into 2021?
These trends will likely continue until there is a definitive timeline for a vaccine to not only be approved, but produced and distributed broadly enough for people to feel like they can get back to “normal”. Until then, you will start to see landlords not only reducing rents, but also offering concessions such as paying the brokerage fee, offering free months of rent, etc. just to fill the vacancies.
When taking a break from the world of real estate, what are some ways people can enjoy these wonderful summer days in Boston?
Summer is one of my favorite times in the city - with so many great options to explore and enjoy Boston - even during a pandemic. On warm days, there are so many amazing parks scattered around the city from the Boston Common to neighborhood greenspaces. Did you know that there are 11 residential parks in the South End alone? There are also some wonderful outdoor dining experiences all around the city with safe and delicious options to enjoy an outdoor meal and cocktail. I have been visiting Del Frisco’s and Lolita in Back Bay which are quick walks from our office. Both have great menus and plenty of space to enjoy a nice day outdoors. North End also has some wonderful Italian restaurants to explore - if you have not been in a while, take some time to check them out!