Boston’s Apartment Market is Solid Going into the Downturn

As the nation starts to show signs of economic stress from the COVID-19 outbreak, Boston’s local apartment market is starting from a position of strength. As of March 2020 – before the pandemic duly impacted the data – Boston saw annual rent hikes of 2.9%, not far from the market’s five-year average of 3.2%. In most months since March 2015, rent growth has deviated only a few basis points (bps) from that average. Occupancy follows a similar pattern of strength. In March 2020, Boston apartments were 96.1% full, one of the best showings in the nation and essentially in line with the market’s five-year occupancy average of 96.2%. Since March 2015, Boston’s occupancy high (97.3%) and trough (95.5%) also deviate very little from the average. While market fundamentals in Boston are expected to slow with the rest of the nation in the near term, the market’s current strength, combined with a concentration of recession-resistant economic sectors such as education, healthcare and government, should help the market weather the storm.