Massachusetts Apartment Rents
Boston Condos for Sale and Apartments for Rent
Massachusetts Apartment Rents
Massachusetts’ rent is the highest in the country
Affordable housing is becoming a hot-button issue across the country. Mortgage rates and property values are higher than ever and only poised to go higher still, and residents of major metropolitan areas are struggling to find affordable homes, or even to stay in the homes they already own. Things aren’t much better for renters, as stories abound of people being priced out of their apartments because of soaring property values.
Historically, if you were to guess the most expensive place to rent an apartment, you might say New York or Los Angeles, and you’d probably be right. But believe it or not, the housing market in Massachusetts, particularly the Boston-Cambridge-Newton area, has seen such a surge in rental prices that the median rent in these areas is $3,490 — which is higher than the San Jose-Sunnyvale-Santa Clara metropolitan area in California. Much of the time, renting tends to be cheaper than home ownership in the US — but with Massachusetts rents being as high as they are, is that still the case?
Cheaper to buy or rent?
No matter where you live, choosing between buying and renting can be a major decision, especially if you’re looking for a place to live in a high-cost area like Massachusetts. Here are some of the major factors to consider:
Payments: As previously mentioned, the median rent in Massachusetts is $3,243, as compared to the national average of $2,150. Mortgage rates in Massachusetts are considerably lower at $2,489, but mortgages can also vary significantly depending on factors like home size and neighborhood. This also doesn’t include expenses such as interest, property taxes, maintenance, and more. From a monthly payment standpoint, however, you’re still likely to come out ahead if you’re in a position to buy a home.
Upfront Costs: When it comes to renting, your upfront expenses tend to be very simple: usually a security deposit and possibly first and last month’s rent. While this can be a significant payout, it’s generally much less than the down payment on a house (typically 20% of the home price, which in Massachusetts comes to over $125,000), closing costs, and other fees.
Long-term benefits: While renting is cheaper much of the time, that’s not currently true in Massachusetts, and renting won’t build any equity the way home ownership does. A house is an investment (albeit one that comes with maintenance responsibilities), but a rental unit will never appreciate in value for you, the tenant. However, renting does offer much more flexibility should you need to move.
Insurance costs: Homeowners insurance is mandatory if you have a mortgage in the United States, and not having it is courting disaster even if you own your home outright. Homeowners insurance in Massachusetts will run you on average $912 per year. This is where renting has a major advantage: according to Kristine Lee at The Zebra, the average annual Massachusetts renter’s insurance premium is $217 — while still higher than the national average, it’s about one-third the cost of a homeowners insurance policy.
More affordable cities for renters in Massachusetts
If you’re looking for affordable rentals in Boston (where even the renters insurance is significantly higher), you’re likely to be in for a bad time. But if you’re moving to Massachusetts and are looking for some alternatives, there are some other cities in the state that are less expensive for renters. Springfield, Worcester, and Lowell, for example, all offer a good balance between affordability and amenities, making them appealing alternatives.
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Massachusetts Apartment Rents
Boston Condos for Sale and Apartments for Rent
Massachusetts Apartment Rents
In Massachusetts, the Fair Market Rent (FMR) for a two-bedroom apartment is $1,194. In order to afford this level of rent and utilities, without paying more than 30% of income on housing, a household must earn $3,981 monthly or $47,769 annually. Assuming a 40-hour work week, 52 weeks per year, this level of income translates into a Housing Wage of $22.97.
In Massachusetts, a minimum wage worker earns an hourly wage of $8.00. In order to afford the FMR for a two-bedroom apartment, a minimum wage earner must work 115 hours per week, 52 weeks per year. Or, a household must include 2.9 minimum wage earner(s) working 40 hours per week year-round in order to make the two bedroom FMR affordable.
In Massachusetts, the estimated mean (average) wage for a renter is $18.43 an hour. In order to afford the FMR for a two-bedroom apartment at this wage, a renter must work 50 hours per week, 52 weeks per year. Or, working 40 hours per week year-round, a household must include 1.2 worker(s) earning the mean renter wage in order to make the two-bedroom FMR affordable.
Source: MA Rents
