For renters, Allston’s apartment rental market has begun 2024 in a better position than last year. Apartment availability has increased by +32.64% year-over-year following 2 years marked by record low rental inventory. As a result, rent price growth for Allston apartments has been decelerating albeit slowly in past few months. Could this be the year we see rent prices hit the top and even flatten in Allston? Here are the trends impacting the Allston apartment rental market in 2024.
In this Report...
Apartment Availability Is Increasing - Potentially Good News For Renters
The Real-Time Availability Rate (RTAR) for apartments in Allston, MA is 5.77%. That’s higher than its level during late January 2023 (2.99%) and +32.04% compared to two years ago. Historically, January is when the Allston rental market begins to heat up and new units available for September hit the market in large numbers. Supply hasn’t shown itself over the past two years but that trend could reverse itself in 2024.
While it is very early to get solid patterns of our leasing season for Allston- the higher supply could indicate that people may be tired of the same apartment and desire a different place to live. What we do know is that students and young professionals tend to stay in much shorter durations in the same apartment – and perhaps this could be a bigger turnover year.
The current Real-Time Vacancy Rate (RTVR) for Allston apartments is 0.78%, up +47.17% compared to a year ago. Vacancy rates have remained at historically low levels throughout the past 24 months in Allston and all of Boston. That trend seems to be softening as we enter 2024. Please keep in mind that while the percentage numbers moving up are quite significant – overall we are still under RTVR targets that would move the needle on pricing in a significant manner.
Median days on market for Allston MA apartments is currently 15 days, down slightly from 30 days ago when Median Days on Market for Allston apartments was 17. 15 days on market is still a very short period of time, and this number is down from a year ago, when median days on market was 23 days. This tells us that despite availability increasing, demand remains strong. Often times a small price reduction is all it takes to get a unit rented. Should the days on market move upwards of 20 days, along with a higher RTAR, that would be a much stronger indicator that potential rent price softening could occur in Allston.
Record High Rent Prices in Allston MA
The current average rent price for apartments in Allston is $3,109. That marks a 29.6% increase in Allston’s average rent price over the past 2 years. This sharp increase in Allston rents can be attributed to a number of factors. Our poor energy policy which helped sparked inflation ripped through all aspects of the real estate community including but not limited to: labor, materials, insurance and utility costs. These avoidable headwinds caused new construction to plummet and helped create the overall lack of inventory in Allston and surrounding areas.
There could be some good news for Allston renters. Rent prices for Allston apartments have shown small signs of flattening out over the past several months. We must also be mindful that landlords just went through the shoulder season of apartment rentals in Allston. Landlords do not like vacant units going into potential freezing temperatures– so they often reduce prices from November through January. Many landlords we know will also drop pricing during February if they have a lease break and make the exiting tenant pay the difference as well as any fees to make sure a unit does not stay vacant.
2024 Allston Apartment Rental Market Conditions
We are seeing upward numbers in both the RTVR and RTAR which suggests that pricing could be nearing the top. However, our data would suggest that we would need to see an almost doubling of the current RTVR and RTAR to see rent prices fall in a meaningful way. The days on market would also have to be about 25% higher in conjunction with higher vacancy and availability rates to confirm prices will start falling. That being said, rent prices could stall out at the top and much of the data compiled over the next eight weeks is going to give us a far clearer snapshot into our leasing season.
It could very well be that the record price growth Allston endured over the past 24 months could start moving student renters further into parts of Brighton where prices are more affordable. There are still some great deals to be found in North Brighton, Brighton Center and Oak Square. Price conscious renters with cars would be better served to wait 8-10 weeks if they are looking to save money on rent away from Allston.
Allston is not as tech heavy in renters as other parts of Greater Boston. If economic conditions worsen and layoffs start to occur in white collar professionals; we do not anticipate Allston to be hit as hard. We witnessed an incredible exodus of people in Allston during the pandemic and that gave us a great insight into the amount of students Allston had in its neighborhood. Therefore we do not think that Allston is as vulnerable to significant rent drops as other neighborhoods with a larger percentage of professionals that move based on economic viability.
While it is too early to give an accurate forecast on rents this year; we think it is plausible that a 3.5%-7% increase occurs across various apartment bedroom count sizes in Allston for 2024. One of the things that is still forcing landlords to raise rents is the high costs of associated with maintaining the property properly. Inflation pushes nearly every factor of ownership and management much higher. Lately we have been hearing some outrageous increases in multifamily property insurance ranging from 20% - 50% more in premiums. Hopefully energy prices and inflation drop later this year to bring some relief to landlords as well as the renters. We will continue to monitor these trends as they develop.
Published February 5, 2024
Demetrios has pulled together the largest apartment leasing team in the Greater Boston Area and is responsible for procuring more apartment rentals than anyone in New England – with over 130k people finding their housing through his services. Demetrios is an avid real estate developer, peak performance trainer, educator, guest lecturer and motivational speaker.