Somerville Apartment Rental Market Holds Strong Despite Rise In Vacancies

The rental market in Somerville has outperformed many other markets in Boston in the past 12 months. In a year marked by disruption and widespread vacancies, Somerville has been able to stay above the downtrend. Interestingly enough, Somerville is a big student market for off-campus housing near Tufts University, and historically it sees the same apartment turnover around September as the other areas located close to the metro’s largest schools.

Apartment Vacancies Up In Somerville - But Not As Much As Most Areas

So when the vacancy rate in the City of Boston hit its unprecedented peak of 9.12% in September of 2020 as a result of remote learning policies, it was odd to see the vacancy rate for Somerville apartments increase to a relatively low 5.39%. That still marked a 159.1% increase from September 2019, but nothing compared to the 300+% YOY change that many neighborhoods saw. Why did Somerville turn out so much better?

It appears as if the population dispersion away from Downtown may have offset some of the demand-loss caused by remote learning. When remote work was adopted by many of Boston’s biggest companies, it sent the Downtown vacancy rate soaring to over 20% last year where it has remained until recently.

So while vacancies soared in Downtown towards the end of 2020, the apartment inventory in some of Boston’s outer neighborhoods inexplicably went down. Suddenly Roslindale and Hyde Park had the lowest vacancy rates in Boston while the rest of the city lay vacant. The metro area, and Somerville in particular, saw home sales surge in the suburbs as a result of increased demand and short supply of single family homes.

The data suggests that many of Boston’s business professionals renting near Downtown opted to buy a house in the suburbs for a more comfortable remote work environment. It’s unclear whether those professionals will move back towards Downtown as the vaccine is rolled out and companies scale down remote work.

Regardless, landlords are looking for a busy summer rental season in Somerville since most of the area’s local Universities have announced that remote learning will be relegated in the Fall. The current vacancy rate of Somerville is 2.17%, which is lower than both the City of Boston (3.17%) and the suburbs of Boston (2.9%). Even better, the summer leasing rush has yet to begin.

So while average rent has decreased in Somerville by -4.49% since May of 2020, it looks like those price drops my dry up soon. Somerville’s average rent of $2,476 makes it the 3rd most expensive Boston suburb to rent an apartment, surpassing Newton over the past year. It is still behind Brookline and Cambridge, the two most expensive Boston suburbs.

So while questions still loom regarding remote work, vaccine policies, and international student mobility, there is plenty of evidence that the market in Somerville will fair well in 2021. Look for rent prices to grow this year and landlord incentives to dry up as we approach the pivotal 9/1 leasing date.