It's Apartment Move-In Season For Students In Boston, And Everything Is Taken
Every year, hundreds of thousands of students come to Boston’s prestigious institutions to attend college. But this year, with the city’s apartment market experiencing all-time lows in vacancy and all-time highs in rents, many students and residents have been left scrambling for housing.
Apartment availability in Greater Boston was at 1.07% last week, and vacancy was at 0.5%, according to BostonPads’ real-time tracker. Rental units in the region have almost entirely filled up in recent months — availability was a little over 3% in June and close to 5% in April, a year after eclipsing 12% in spring 2021.
“Without a doubt, this year has felt like there’s more of a sense of urgency than I’ve noticed in years past,” said Chris Taylor, an apartment broker at Advantage Real Estate.
Taylor works right near Boston University’s campus and said most of his clients are college students. In the 10 years he has worked at Advantage Real Estate, he said that this rental cycle pressure is definitely more palpable than in past years.
“It's just a super-competitive year for the rental market,” Taylor said. “It sort of stretched out this year. Usually, it ebbs and flows, but this year, there's just a consistent theme of the competitive market that we're all kind of noticing.”
Available apartments are disappearing as Boston’s universities are seeing record numbers of students. BU’s 2021 student body of 36,809 was 2,000 students larger than 2019, and while the school doesn’t have enrollment data for the fall 2022 semester, a record 81,000 students applied for admission.
Northeastern University enrolled 6,000 more students during the last school year than it had in the year before the pandemic. It took in more than 75,000 applications in 2021, a record for the private school just south of Back Bay. For this fall, it received 91,000 applications.
BostonPads CEO Demetrios Salpoglou said three factors are driving the record-low availability in the city: renovations on apartments that were emptied during the pandemic, a high rate of renewal and the lack of adequate new construction in the market.
“Boston always runs in a very, very low availability rate and vacancy rate because we just move people in and out and we have limited supply,” Salpoglou said. “We don't produce enough apartments to meet population growth.”
Boston developers are underway with 19,000 new apartment units, which would increase the city’s inventory by 8%, according to Colliers' latest Boston multifamily market report. While that is the highest level of construction since the pandemic, it is still below 2019 levels, when the city was adding 10% to its apartment inventory.
Clara Wineberg, who serves on the Urban Land Institute’s Student Housing Product Council, said that cities like Boston and Cambridge act as innovation zones, which are rich with not just students and faculty but professionals in the life sciences, health and technology sectors.
These zones get a lot of attention because students want to live close by, but with demand at an all-time high and with supply low, many have to branch out, Wineberg said. As a result, students are moving into neighboring cities and towns like Malden, Everett and Melrose in search of rents they can afford.
“There's just a shortage at all levels in Boston,” Wineberg said. “We're seeing new areas be developed, whether that's Everett that's going to spill over, and certainly the Allston area across the river. Expanding the reach of neighborhoods where students are living, I think that's what we're seeing in Boston. It's gonna get a little bit more spread out.”
During the pandemic, Boston students living on campus decreased by almost 41%, according to the student housing report Boston released in 2020. The number of students living off campus increased by 16%.
As part of Boston’s Housing a Changing City: Boston 2030, city officials set a goal of creating 18,500 new dorm beds by 2030 and reducing the number of undergraduates living off campus by 50%.
“They want students to live in purposeful student housing, but those same communities often make it hard to have new development,” said Wineberg, who is principal and Boston executive director at architecture firm SCB.
The sprawl of students into suburban areas can lead to off-campus competition with families and other permanent residents in a community. Wineberg said many of Boston’s smaller universities haven’t been able to keep their on-campus housing production on pace with their needs.
“Schools that don't have the deep pockets as some of the schools in Boston will often rely on the off-campus student housing as that sort of umbrella of housing,” Wineberg said. “There is certainly an emphasis on wanting to create more.”
The sudden return of the full population back into Boston in the last year has left the housing cupboard of the city bare. There are fewer than 900 nonluxury apartments available for rent in the entire Greater Boston area today, according to BostonPads’s real-time data. Just four months ago, there were more than 3,500 nonluxury apartments on the rental market.
“It was amazing just to watch the migration back into the city of Boston,” Salpoglou said. “What I don't think any of us expected was how big a demand driver coming back to the city would be.”
The low vacancy is pushing up rents to historical levels. The average rent is $2,695, 1.8% higher than the pre-pandemic record, according to BostonPads.
Eddie Cruz, property manager at Melnea Residences and managing broker at Mi-Ella Realty, said that with rents rising across the city, he has seen more renewals, which has left fewer apartments on the market for students moving from out of town.
“When everybody goes to look for an apartment and they compare what we have to what they currently have, they're paying almost $1K more, so they decide to renew because renewals don't increase as much as the new market rate does,” Cruz said.
Although developers continue to increase the pace of construction — nationwide, apartment construction is near a 50-year high — experts said city officials must do more to increase the supply of housing options available not just to students but to all residents of Greater Boston.
“Everybody wants to live there, and I don't think that's going to change anytime soon,” Salpoglou said. “We have the jobs, we have the colleges, we have the highly skilled workforce. We've got to focus on innovative solutions to streamline permitting, build smart growth and possibly look at different ways to quickly add supply.”