2020 Somerville Apartment Rental Market Report
The year of COVID has brought with it many changes to the Somerville apartment rental market and the Greater Boston rental market as a whole. Apartment inventory is up all over the city, and the trend is particularly noticeable in the neighborhoods nearest to downtown and the areas close to universities.
Somerville apartment vacancies have increased significantly caused in part by professionals being able to work remotely and students not returning to Tufts and other local area colleges. There are now a lot of companies allowing their employees the ability to work from anywhere so many have decided to either move back home or find other places that are less dense in terms of social proximity. This has led many to speculate that a price correction would be imminent, and while prices have dipped slightly year over year, it does not match up equally with all the added inventory we’re seeing.
Overall Somerville has seen an average -2.23% decrease in rent prices for all size units since October 2019. The Real-time Vacancy Rate (RTVR) has increased by 247.3% during that same time. So despite the fact that there is a significant increase in the amount of vacant apartments, rent prices are for the most part staying steady. However, this situation could change quickly, as colder weather sets in, and landlords sit vacant longer after the usual 9/1 leasing market push. Pandemic or not, less apartments are always rented during the October to December time frame.
|Town Neighborhood||2020 Vacancy Rate||2019 Vacancy Rate||% Change|
Somerville remains one of the most expensive areas to rent an apartment during 2020. Somerville apartments rank 3rd most expensive among all Greater Boston locations for 1 bedroom, 2 bedroom and 4 bedroom apartments, behind only Cambridge and Brookline.
|Neighborhood||Studio Avg. Rent||1 Bedroom Avg. Rent||2 Bedroom Avg. Rent||3 Bedroom Avg. Rent||4 Bedroom Avg. Rent||5 Bedroom Avg. Rent|
The increase in vacant apartments can be attributed to COVID-19 effects, partly driven by fact that Tufts University located in nearby Medford will be adopting a hybrid online/on-campus fall semester. There are also other universities in the nearby area and Somerville has been a big draw for students. There has also been a lack of local new job creation during the pandemic. There hasn’t been as big a job demand driver that Somerville normally sees coming from the high tech and bio tech market that surrounds Cambridge. As a result, Somerville has the 8th highest year over year increase in vacancy rates at 247.3% compared to all outer core areas. While many Boston suburbs are absorbing the residents fleeing from densely populated downtown, Somerville is seeing a record number of vacant apartments for different reasons that are stated above.
The fact that rental prices are holding steady could be a signal of landlord confidence that a recovery is soon to come. Quite frankly, it’s simply too early to tell if prices will drop in a huge way, but if move-in incentives are any indication, it looks like they will eventually occur as creative leasing packages are happening in a major way. Most landlords have started paying brokers fees, and some have either dropped last month’s rent and/or security deposit or both! Many landlords are waiting it out to see what will happen with the spring semester, and how a vaccine plan gets implemented before they make any big moves. It’s important to understand if students will start returning in January or not for a new semester. We should start seeing those market patterns of students looking for January apartments within the next 30 days.
The most expensive neighborhoods within Somerville such as Porter Square and Davis Square have seen a relatively low increase in RTVT compared to more affordable neighborhoods like East Somerville, Ball Square, and Spring Hill.
|Town Neighborhood||2020 Vacancy Rate||2019 Vacancy Rate||Change|
|Davis Square||4.26%||1.40%||+204.29%||East Somerville||6.87%||1.44%||+377.08%|
|Magoun/Ball Square||4.61%||0.70%||+558.57%||Porter Square||2.43%||0.71%||+242.25%|
|Winter Hill||5.47%||1.80%||+203.89%||Union Square||5.12%||2.16%||+137.04%|
|West Somerville/Teele Square||4.25%||2.51%||+69.32%|
There are many different theories as to why some areas of Somerville are holding up better than others. But, if you are a renter, looking for a deal, focus on the areas with the greatest increases in vacancies. Chances are the old adage “supply and demand” never goes out of style. You could be seeing some of the best deals in years in Somerville!
We will continue to monitor the changes in vacancies and rent prices throughout the year.