2022 Cambridge Apartment Rental Market Report
Thus far, 2022 has been good to the apartment rental market in Cambridge, MA. After 18 months of rental supply saturation and price shrinkage caused by COVID, the market in Cambridge has turned a corner. Now, availability of Cambridge apartments is on par with pre-pandemic levels and the average rent price is closing in on its all-time high set in April of 2020. Even more impressive, the real-time vacancy rate (RTVR) in Cambridge hit an all time low of 0.50% last month, indicating that renter demand is outpacing apartment supply at the current moment.
Cambridge Apartment Supply Metrics
The current RTVR in Cambridge is 0.62%, up slightly from its all time low set late last month. That is 46.09% lower than the pre-COVID RTVR in mid-May 2019 (1.15%). This is a remarkable recovery considering the vacancy rate hit an unprecedented 8.27% in October 2020. There are still 3 months ahead of us until we reach late August, when vacancies reach their annual low point historically. So, it’s all but assured that RTVR will continue to push to new all-time lows.
The most recent Cambridge apartment data also shows that the current real-time availability rate (RTAR) is very close to its pre-pandemic level. RTAR is an important rental supply metric that helps predict future market performance. It measures how quickly the market is absorbing the new inventory that is coming out for September. The current RTAR in Cambridge is 5.21%, which is just slightly above the May 2019 RTAR of 5.05%.
Looking at these apartment supply metrics side-by-side, it appears that Cambridge’s rental market is as healthy as it’s ever been in spite of the challenges faced over the past 2 years. Rent prices have already begun to rebound as a result.
Cambridge Average Rent Prices
The current average rent price for non-luxury apartments in Cambridge is $2,927. That marks a +6.49% increase in rent year-over-year, and it currently sits $24 short of its all-time high ($2,951) set in late April 2020. By May of last year, the average rent price in Cambridge had dropped more than $200 below its all-time high, but it has since regained most of that loss. At the current rate of price growth, Cambridge would set a new record high average rent near the end of this month.
Despite the price drops caused by COVID, Cambridge is still the most expensive suburb to rent an apartment. Brookline is the second most expensive suburb, with an average rent price $60 shy of Cambridge ($2,867). In addition to overall average rent, Cambridge holds the highest suburban average rent price for all sized apartments, from studios up to 5 bedroom units.
2022 Cambridge Rental Market Predictions
Based on current rental data, we expect the Cambridge apartment rental market to continue to strengthen over the latter half of 2022. The current data points to a short-supply of non-luxury apartment units in Cambridge, which are always in high demand among both the off-campus and young professional groups. With no imminent plans of vastly increasing the supply of housing units, it appears that rental inventory will only get tighter as we approach the end of the year. Housing officials and legislators are going to have to come up with innovative ways of increasing density and overall housing stock with limited land options.
We also expect summer rentals to make a full comeback in 2022 after taking a two-year hiatus due to remote work trends during COVID. Offices have reopened, putting additional pressure on the already tight supply of apartments in Cambridge. Look for rent prices to continue to rise and possibly even accelerate during the second half of 2022 as a result. It wouldn’t surprise us if we see an additional rent increase in aggregate for Cambridge in 4-6% range for the remainder of the year. With inflation running rampant and runaway energy, materials and labor costs; a continued rise in rent prices is almost certain. Cambridge renters who act early will see the best pricing in 2022 as well as the most options. Those who wait until July or August to lock down a rental for September will likely be faced with higher pricing and even lower inventory. If you are looking for further details about specific real time neighborhood data in Cambridge from both the sales and rental perspective; please feel free to reach out to us directly.