2022 Newton MA Apartment Rental Market Report
The rental market in Newton, MA is experiencing historically low apartment inventory thus far in 2022. Newton apartment availability is down by -59.85% compared to pre-pandemic levels in mid-July 2019, while vacancies are down -82.79% over the same time span. Late last month, both the real-time availability rate (RTAR) and real-time vacancy rate (RTVR) in Newton hit all-time lows of 1.33% and 0.16% respectively. As a result, the average rent price for Newton apartments is up +8.52% year-over-year and sits just $21 shy of its previous all-time high set February 2020 ($2,690).
Apartment Supply At Historic Lows in Newton MA
The current real-time vacancy rate (RTVR) of apartments in Newton, MA is 0.21%. That ties Newton for the second lowest RTVR among Boston suburbs behind Arlington. Vacancies are down -87.57% year-over-year and have remained below the 1% mark since March of 2022. If you look at Newton’s rental data throughout COVID, you’ll notice that the RTVR only briefly crept above the 3% level while Boston’s RTVR hit an unprecedented 9.13% in September of 2020.
Newton Real-Time Vacancy Rate
The real-time availability rate (RTAR) in Newton is currently 1.54%. Newton’s RTAR stayed relatively flat throughout the pandemic. Apartment availability briefly surpassed the 4% level in Newton during March of 2021 while Boston’s RTAR skyrocketed to over 13%. RTAR in Newton has remained below the 2% mark since October of 2021. Interestingly, Newton’s RTAR stayed above 2% throughout most of 2019, indicating the apartment demand in Newton is now stronger than it was prior to COVID.
Average Rent Price Approaching All-Time High in Newton MA
The current average rent price in Newton MA is $2,669. That figure began trending upwards in December of last year after dropping -11% below its previous record high during COVID. At the current rate of price growth, Newton will surpass its previous all-time high of $2,690 sometime late next month. Newton’s current average rent price is the 3rd highest among Boston suburbs behind Brookline ($2,951) and Cambridge ($3,031), but still slightly below the city of Boston’s average rent price ($2,712).
Newton MA Apartment Rental Market Forecast 2022 and Beyond
At first glance, it appears that Newton’s rental market is in a very strong position as we head towards the fall. Low rental supply and rising rents are usually indicators of strong demand in a market, which certainly is the case right now in Newton. However, the rental market in Newton and all of Greater Boston for that matter is under a cloud of economic uncertainty.
As inflation grips the economy, a recession appears imminent if not already here. If it gets to a point where we see massive corporate layoffs in the Boston metro region, it will lead to a significant decline in renter demand. If that happens, the more expensive rental markets like Newton would likely see the biggest drop in apartment demand. We saw this same trend during COVID when average rents in Boston’s most expensive neighborhoods dropped by larger margins than rent prices in the city’s more affordable areas.
At least for now, Newton’s rental market has emerged from the pandemic looking stronger than before. It appears that Newton benefited from a demand-shift towards the suburbs during the pandemic. When offices and schools went remote and the city locked down, many renters opted to look for apartments in the suburbs where they could find more spacious remote work environments. Similar trends have been observed in the Arlington, Quincy, and Watertown rental markets.
Thus far, 2022 has proven that trend to be more than just a temporary phenomenon. Rental inventory remains at historic lows in much of Greater Boston. As a result, average rent prices are nearing or have already surpassed all-time highs in most of Boston’s suburbs. Given current supply levels, we forecast that Newton’s average rent price will continue to climb as we approach the 9/1 leasing date. We predict that prices will level off towards the end of the year as economic conditions worsen before trending back downwards in 2023.