Mission Hill Apartment Rental Market Report 2021
The apartment rental market in Mission Hill is more easily susceptible to price fluctuations than many other Boston neighborhoods. The Real Time Availability Rate (RTAR) will often vary for several reasons. It’s situated very close to a significant number of higher education facilities including: Northeastern University, Wentworth Institute of Technology, MCPHS University, Mass College of Art and Design, Emmanuel College, Simmons University, etc. so it makes sense that Mission Hill apartments experience higher turnover than other parts of Greater Boston.
Under normal economic conditions demand is so high in this small neighborhood that apartments are rented out months before they are even vacant. For nearly two decades, apartments in Mission Hill have experienced high turnover coupled with strong demand due in large part to increasing student enrollment numbers and expansion of multiple Universities in a slow accretive manner.
Generally speaking, high turnover isn’t much of an issue when you have high demand. This reliable high supply and big demand housing scenario was recently disrupted when COVID made its impacts felt in the area in 2020. Different housing patterns may be emerging and 2021 which could send us on a wild ride due to increases in the Real Time Vacancy Rate (RTVR) and a wider variety of apartment options due to recent local development.
Mission Hill is currently seeing record high vacancies even after the traditionally heavily weighted 9/1 move-in date. The current RTVR of 5.59% is the 8th highest among all neighborhoods in Boston. That figure marks a 354.47% increase since December 2019 when the vacancy rate was 1.23%. Between most Universities adopting remote learning and the travel ban preventing thousands of international students from arriving in September, the current vacant apartment rental market in Mission Hill has seen some pricing challenges.
The following chart shows year over year vacancy rate increases in the neighborhoods closest to the area’s Universities. The data clearly shows these areas have been adversely affected much more than the average in the area. What is not so clear as of this data pull is how the 9/1/21 apartment market is going to fare. It appears that there is a still a strong appetite for the best apartments on Mission Hill that are in great condition coupled with price when matched against peer properties. This apartment rental year is going to be slightly different because many of the Greater Boston Universities and colleges came back later and are also cancelling their traditional spring breaks.
|Town Neighborhood||2020 Vacancy Rate||2019 Vacancy Rate||% Change|
|City of Boston||5.70%||1.19%||+378.99%|
The Realtime Availability Rate (RTAR) is a good predictor of future supply. It is calculated by adding the current vacant apartments with the units set to become available, and dividing that into the total apartment supply. When the RTAR is higher than normal, it could suggest that the RTVR will go up when leases end without replacement tenants coming in. However, considering that there is a long runway from now until 9/1/21 this could change based on a myriad of economic and other factors.
The RTAR in Mission Hill is currently 13.53%, the 4th highest out of all Boston neighborhoods. This is not out of the ordinary for Mission Hill in late January as students come back for spring semester and notify their landlords of their intent to vacate. Exactly a year ago, that figure sat at 10.43%, which was the 3rd highest in Boston at the time.
Considering how the Vacancy Rates in Mission Hill have compared to other similar neighborhoods in Boston, it’s safe to say Mission Hill’s apartment market seems to be holding up stronger than the neighborhoods closer to Downtown, which has been impacted by massive vacancies.
|Rank||Town Neighborhood||2020 Availability Rate||2019 Availability Rate||% Change|
We are seeing landlords putting their units out to market earlier and some of that maybe due to tenants saying they are not going to renew their lease for 2021. It’s quite possible that some students maybe looking for larger bedroom count apartments to aid with affordability, which would explain the higher vacancies of rentals near Northeastern and Fenway apartments where those larger units are harder to find.
We have heard from students indicating they are still getting a handle on the local area’s schools policies regarding remote learning going into the future. It appears that there are differences in various Universities’ remote learning policies which is causing some challenges in the certainty of people wanting to sign leases. The various policies of local universities is a constantly fluid and changing situation so strategies and plans vary widely for each participant in this process.
Average Rent Prices in Mission Hill
Prices of vacant apartments have been in steady decline all around Boston since September, and Mission Hill is no exception. Mission Hill is still pretty average in terms of Boston rent prices, although larger size units tend to be about 10% more expensive than Boston’s average. It is slightly more expensive than apartments in Allston and Fort Hill, but less expensive than Symphony and Fenway.
Room rentals have been effective for some landlords as a way of avoiding complete vacancy. Some Mission Hill property owners have worked with real estate agents to fill their rentals one room at a time. In any economically challenged environment, flexibility and rapid responses to consumer inquiries are key.
|Neighborhood||Studio Avg. Rent||1 Bedroom Avg. Rent||2 Bedroom Avg. Rent||3 Bedroom Avg. Rent||4 Bedroom Avg. Rent||5 Bedroom Avg. Rent|
|City of Boston||$1,719||$2,076||$2,531||$3,023||$3,612||$4,417|
While prices are certainly down on vacant apartments since last December, they aren’t down in the numbers you would come to expect after a doubling of supply year over year. There are multiple reasons for this and some of it has to do with landlords taking their units “off line” to begin renovating and clean up their properties. We are seeing various Mission Hill landlords finally having the time to put in the proper work on some of their units which was just not possible due to the tight market cycle.
So, there is a bright side for the Mission Hill apartment seeker as the overall quality of the housing stock is going up. Many landlords are finding unique ways of offering concessions or upgrades in order to spur demand and eep pricing from falling on vacant units. We’ve seen waived deposits, free months rent, free parking spaces, and even subletting concessions in the lease in an effort to fill vacant units. In Mission Hill alone, landlords are covering some if not all of the broker fees in 28.47% of currently available apartments. This is unprecedented, as historically the landlord pays the broker fee in only 3-5% of apartment leases in a strong market like Mission Hill.
The Mission Hill apartment rental market is going to be a wild ride this year. Predicting how the Mission Hill Real Estate vacancy and rent pricing plays out has an incredible number of variables. It looks like it is going to be a weekly analysis of the absorption rate that is going to determine overall pricing. Stay tuned as we closely watch this interesting neighborhood react to the current economic conditions. We will be writing a follow up article in a couple of months to update accordingly.