Would the new extremely high rent prices cause a collapse in the Boston rental market next year?? (if more and more tenants break their leases??

Asked by CH Naamad, Boston, MA Sat May 14, 2011

I have never seen prices like these in the Boston area before???? I am NOT really sure these prices are sustainable, considering the economy and the median salaries here???

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9
CH Naamad, Agent, Boston, MA
Fri Jun 29, 2012
This is pure wishful thinking. demand is still increasing, ans so are rents. We just have to get used to it.
0 votes
Bobby Woofter, Agent, Boston, MA
Fri Jun 29, 2012
The demand will not go down at all. We are seeing some people pushed out to further neighborhoods because they have been priced out. Moves from the South End and Back Bay to Southie, JP, or Davis Square. There is a glut of new rental stock being built in the city but it will take some time before these units hit the market. A price adjustment will come but I doubt it will be anything near a collapse. Demand is not falling off and it remains very difficult to build new housing stock in Boston. I for one would prefer a downward adjustment in rental prices. The current rates are laughable and I don't think they are sustainable.
0 votes
James Furlong, Agent, Brookline, MA
Tue Jun 19, 2012
I don't think we will have a situation with tenants breaking leases. This year's sudden increase in rents will subside in the same way is has done in past cycles. Renters who have the ability to buy will do so because of the high rents, resulting in decreased demand and a higher supply. We have seen a sudden surge in the first time home buyer market and that will continue due to the combination of low interest rates resulting in lower monthly mortgage payments and realistically priced properties.
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Scott A. Nel…, , 02155
Sun May 15, 2011
It's becoming a greater & greater concern to find "affordable" not state sponsored affordable apartments for "regular" individuals, couples & families to find inside of Rt. 128. Perhaps some of it is the high barriers that are now in place for mortgages that are holding people back or they're no so interested in buying into the mantra "Now is a great time to buy". With jobs as a national issue tenants & homeowners are feeling a real pressure to find a meeting of the minds. One area especially I find under available is properties that are willing to accept pets. I don't mean service animals as those are exempt but it's tough for alot of potential tenants to find housing that will accept pets. The places that accept pets are going at an even higher premium.
Web Reference:  http://www.MedfordHouse.com
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Christine Mo…, Agent, Wilbraham, MA
Sun May 15, 2011
Thew economy is fueling it. It is the job market. Out here (Western MASS) the houses are falling but rental pricese are high. 90 miles away.
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Don Maclary, Agent, Virginia Beach, VA
Sun May 15, 2011
The trend here is investors are buying up properties as buyers are holding back and missing the boat on low interest rates.
0 votes
Patty Allen, , Clemson, SC
Sun May 15, 2011
We have had a buyers market going on for a while, and along comes the property managers or owners who decided to rent out single family homes they were trying to sell at such exhorbitant monthly rental rates and matching deposit money.

Boston is like any college city. Students don't want to live on campus in small rooms and follow rules as they did at home. They get together with 2-4 people and rent single family houses with pools and all the amentities of these expensive homes just like they lived at home or better. One college town in South Carolina began building an alternative to off-campus apartments. They are like a resort with everything these students could ever ask for with shuttle service or walking to campus renting a huge bedroom with study area and bathroom and share huge common areas together at around $400-500 a month per person with no cost for utilities or worrying if an apartment community with their room-mate forgets to pay, doesn't have enough to pay, transfers to another college out of state, goes back home, just leaves, doesn't get along, or moves in with a girlfriend or boyfriend.

Those with small families can't afford to rent a 2 bedroom 1 bath house in an undesirable neighborhood for under $800 + pay all utilities per month and cut grass. Rentals here in a capital city Southern state with military bases and tourism areas go for $1300-5000 per month + utilities. No family can afford that and are better off in their own home IF THEY CAN QUALIFY or IF THEY DIDN'T LOSE THEIR HOME. These college students have their parents back home pay for it, or they use their federal and state grants to pay their rent sometimes combined with a part-time job.

Leases are now more flexible in apartment "homes" or communities offered to them at 3-9 months in length to accommodate their semesters. That use to be for traveling business people only. Still these college towns have too many empty apartments as they over-built for these students. They can also sublet their rental portion for the summer if the rest of the college students living with them approve of the short time temporary tenant. Those type of rentals are rare but seen now and then on Craigs List.

These single family houses are only worth 1/4 their rental cost. It's so ridiculous! This bubble will break as well just as the apartment communities stopped raising rents when their competition was more attractive to these students. Colleges keep raising their tuitions and costs of books and parking and other fees. One state university of many in this town charges $70 a semester for "free" parking; it's at the bottom of hills, blocks from classes, a very long walk with their stuff, and has to be timed just right to get a spot and the campus bus coming around early or late or on time. The "free parking" consists of several lots where a student has to jockey for a spot for their college classes and non-college events going on all the time around it. When a circus or 2 comes to town the night before walking the animals in a parade, students know they already lost parking lots for the next few days. Cars are hit and scratrched up during the school year. I have 2 areas that have to be fixed from my college student's 2 semesters! He/she says they drive so fast through the areas following other students like stalkers who just had their classes for the morning and rush for those spots. He/she says it's not worth it and parks further away in the lot farthur away to not get scratches on my new car. My college student did technical school 2 years and then 4 year living at home to not deal with room-mates and extra costs.

Students will look across the street from the parking lots and see these all amenties campus offerings they can move into just having to pay for a huge rental room with lots of storage, closets, and bathroom with no hassles. As I said, they are like resorts having everything! If I were their parent subsidizing any of their education, I'd have them spend their 1st two years at home going to a comkmunity or technical college and working a job or volunteering in what they want in a career and then when older go off to a 4 yr. college.
0 votes
Vincent Murp…, Agent, Boston, MA
Sat May 14, 2011
nothing last forever and the housing prices in Boston and rents will not last. I know many think it will. It will not and i'm 100% check back on this post in 2013 I told everyone in 2005 mot to buy sell and go cash. A little early but no complaints from them.....just look what people pay and ask yourself ..........really
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CH Naamad, Agent, Boston, MA
Sat May 14, 2011
I mean, demand is so high that almost nothing stays on the market for more than a few days regardless of pricing???
And this is across the board from basic rents to luxury rentals. I have seen a $4500 price tag for a 735 sqf unit???
We are looking at over 20% increase from last years prices and rising, almost exponentially!!!!!
I hope I am wrong!!!!!!!!!!!!!!!!!!!!!!!!!
0 votes
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