A pair of publicly-traded apartment landlords reported big rent gains at their Boston-area properties, while a national research report said rent growth is slowing after 18 months of record-breaking increases.
Equity Residential said Greater Boston is now its second-highest-priced market in the U.S., trailing only New York and one notch above San Francisco. Average rents rose 14 percent to $3,288 in the third quarter in its Greater Boston portfolio compared with the previous year, based upon same-store results for 6,430 apartment units in the region.
“Our affluent resident base remains well employed with growing incomes, creating strong demand to live in our desirable properties and driving outstanding financial results this quarter,” CEO Mark Parrell said in a statement accompanying the Chicago-based REIT’s third-quarter financials.
Boston Properties said rents rose as much as 22 percent at its three apartment properties in Boston and Cambridge. The Hub50House at The Hub on Causeway led the way with average rents now topping $4,102, a 22 percent annual increase. Rents rose 13 percent to $4,238 at The Lofts at Atlantic Wharf in Boston and nearly 10 percent to $2,895 at Proto Kendall Square.
Separately, a report released today by researchers Yardi Matrix said the big run-up in rents over the past 18 months is concluding.
Boston is one of only five large U.S. metros where rents rose at so-called “lifestyle buildings,” defined as high-mid-range properties that appeal to double-income households without children, Yardi Matrix reported.
Of the 136 multifamily markets that Yardi Matrix tracks, 56 had month-over-month declines in asking rents in September, compared to 53 markets with declining rents in August and 18 markets with declining rents in July.
Of the 30 largest metros, only Miami, Nashville, Boston, Baltimore and Kansas City had rent increases in the lifestyle building segment.
Equity Residential’s Parrell said apartment rents are being driven in part by the housing shortage.
“Longer term, we will continue to benefit from trends such as high single family housing costs, favorable demographics and an overall deficit in housing across the country,” Parrell said.
