Boston Investment Property for Sale - 2023 Rental Home Appreciation
According to Forbes, the Boston real estate market is “hot.” Demand is high, inventory is low, and home prices have been increasing by double digits for several years. This is good news for real estate investors who already own a Boston investment property. It’s terrible news for anyone looking to break into the Boston real estate market.
Fortunately, the Boston real estate market is starting to cool. Data from Q4 2021 shows a 7% increase in home prices in Boston, a decrease from 11% the previous year. A 7% increase is still significant for real estate investors, agents, homeowners, and property managers.
Boston is home to 65 neighborhoods. The most expensive is Beacon Hill, with a median listing price of $2.4 million. The most affordable is Commonwealth, with a median listing price of $497,000.
The median listing price in Boston is $831 per square foot, and the median sales price is $824,250, according to Realtor. The median rent in Boston is $2,930 per month.
Given the demand and cooling market with steady appreciation, Boston, MA, presents many real estate investment opportunities and the potential to earn rental income.
Boston's Attractive Housing Market
The Greater Boston Area is home to some of the best neighborhoods and suburbs for real estate investors. These neighborhoods include Brighton, Brookline, Cambridge, Hyde Park, and Roslindale.
- Brighton: Brighton is located southwest of Allston and northwest of Brookline along I-90. Brighton offers the convenience of city living with an easy commute to downtown Boston. Brighton is also just a short train ride to Back Bay, North End, Seaport, and South Boston. The median listing price in Brighton is $714/sqft, and the median sales price is $582,950. Median rent is $2,500/month.
- Brookline: Brookline is located southwest of downtown Boston and borders Brighton, Allston, Fenway-Kenmore, Mission Hill, Jamaica Plain, and Roxbury. It offers a suburban feel in the middle of the City of Boston. The median listing price in Brookline is $780/sqft, and the median sales price is $1,550,000. Median rent is $3,200/month.
- Cambridge: Cambridge is located across the Charles River west of Charlestown and northwest of downtown Boston. It’s home to Harvard University and the Massachusetts Institute of Technology (MIT). The median listing price in Cambridge is $904/sqft, and the median sales price is $1,005,000. Median rent is $3,100/month.
- Hyde Park: Hyde Park is located south of Roslindale and Roxbury. It’s home to several parks, playgrounds, and the George Wright Golf Course that attract young families. The median listing price in Hyde Park is $411/sqft, and the median sales price is $599,000. Median rent is $2,250/month.
- Roslindale: Roslindale is located in South Boston, just southwest of Dorchester. It’s bordered by Hyde Park, West Roxbury, Jamaica Plain, and Mattapan. Roslindale has some of the highest home value appreciation in the Greater Boston Area. The median listing price in Roslindale is $486/sqft, and the median sales price is $650,000. Median rent is $2,500/month.
Real estate investors will also find ample opportunities in Boston’s neighboring towns and cities. Providence, Rhode Island, is located 50 miles southwest of Boston. Home prices and rents are more affordable in Providence than in Boston, which attracts many commuters. The median listing price in Providence is $252/sqft, and the median sales price is $315,000. Median rent is $1,800/month.
Worcester, another commuter city, is located about 50 miles west of the City of Boston along I-90 past Marlborough and Framingham. It offers historic charm and affordable home prices with proximity to Boston. The median listing price in Worcester is $228/sqft, and the median sales price is $349,000. Median rent is $1,970/month.
Rental Home Appreciation in Boston
Boston has a robust rental market. According to a Point2 report, 65% of households in Boston are renter-occupied. Young professionals aged 25-34 make up 33% of all renters in Boston. This demographic ensures a steady demand for rental properties.
Demand combined with a 7% appreciation rate means an opportunity to earn a good return on investment (ROI) on a Boston rental property.
Economic Growth in Boston
The Greater Boston Area is home to over 4 million people, and the City of Boston was hit hard by the pandemic. Fortunately, its economy is rebounding quickly and moving towards pre-pandemic levels.
Boston's primary industries are healthcare, finance, insurance, and higher education. The largest employer in the City of Boston is Massachusetts General Hospital. Other top employers in Boston include Amazon, General Electric, Fidelity Investments, and Liberty Mutual. These stable industries attract many young professionals to Boston.
Boston's projected job growth rate of 42.5% over the next ten years. It has an unemployment rate of 5%, below the national average.
Boston's strong, steady economy has always made it a great place to invest in family property or rental property.
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