Shoud you invest in the Boston real estate market? Investing in real estate is surely one of the best ways to make money. With the right financial plan and knowledge of the local real estate market, anyone can become a real estate investor. But before you tap into these waters, you should ask yourself: Where is the best location to purchase a property? One possible answer to this question could be Boston, Massachusets! Except, how do you make sure now is the right time to invest? Don’t worry, because by the end of this article you’ll know whether Boston real estate is worth it or not.
Past real estate trends in Boston
Before you set out to buy a property, you must first understand how the Boston real estate market behaved in the past. After all, there’s no use in browsing real estate for sale if you don’t know the history of the market. That’s why the best way to ensure a good return on investment is to research the market at least for the previous year. Monthly reports are easily accessible on the internet, but we’ve summed up all the important facts to save you time.
First off, you’ll be pleased to know that in the last twelve months, short term real estate investors have found good returns in Boston. One of the strongest parts of the Boston real estate market is the
appreciation rates. In fact, at 8.05% they are among the highest in the U.S. To be more precise, the appreciation rate is higher than in 90% of other cities in Massachusetts and 82.5% of the cities in the nation. And while prices have climbed in 2019, the pace isn’t as torrid as in 2018 and 2017. So far so good, but let’s have a look at what’s expecting you this year.
vacancy is a rare sight in Boston. After all, people are moving here for the prolific job opportunities, and relocating goods to or from Massachusetts has never been easier. Moving companies nowadays are making it all the easier for people to flock here in search of work opportunities. And when we take a look at the median rent in 2019, which was around $2,500, it has climbed around 6% compared to 2018. This relatively high cost of rental apartments creates a fairly good return on investment in the Boston real estate market.
alt-text: house, coins, and a clock; Caption: A good appreciation rate makes the investment worth it in the long-term
What to expect in the 2020 Boston real estate market?
Whether you’re buying a rental property or a family home, you’ll want to look at predictions for this year’s market condition. Boston has been ahead of the pack when it comes to the job market, technological advancement and schooling options, there’s no doubt about it. It’s quite easy to see why the housing market is ever-expanding, and why it holds a high-price standard. And while first-time homebuyers are expected to struggle with the affordability, there is a strong demand for Boston real estate in the world of investors. Median property price is around $820,000, with a price per square foot being around $710.
With this in mind, the real estate market is expected to be a buyer’s market this year. First-time condo buyers or beginner investors can choose a location as there won’t be any bidding wars. The demand is strong, but inventory has been able to catch up so far.
Return on investment and appreciation rate
One might argue that Boston’s real estate prices are too high, but it’s essential to look at the bigger picture. Yes, it does hold a fairly high bar for entry, but once you’re in the game, you’re looking for some amazing returns. Now, we’ve already mentioned Boston has some of the highest appreciation rates in the country. Thanks to strong demand and limited inventory, it will stay this way in the foreseeable future. Not to mention the city is built on solid economic foundations, so apartment vacancy is a rare sight in Boston. After all, people are moving here for the prolific job opportunities, and relocating goods to or from Massachusetts has never been easier. Moving companies nowadays are making it all the easier for people to flock here in search of work opportunities. And when we take a look at the median rent in 2019, which was around $2,500, it has climbed around 6% compared to 2018. This relatively high cost of rental apartments creates a fairly good return on investment in the Boston real estate market.
Top neighborhoods to consider
If you’re an experienced investor, you already know this, but it’s worth noting it for the beginners as well – location matters. No, it’s not just the city, it’s the neighborhood as well. Picking a profitable neighborhood is crucial if you want a high return on investment. Should you go with the upscale Beacon Hill apartments near General hospital? Or maybe aim at Downtown Boston as a target for students of Boston University? Whichever you choose, it’s first important to do your research and learn a bit about each one of them. Contacting a local real estate agent as they might help you in the decision-making process, since they probably know the area better than you do. Let’s take a look at some more of the top neighborhoods you can choose from:
- Allston – median property price is around $480,000, well below the city level
- Brighton – a quieter, residential neighborhood, with a median price around $500,000
- South Boston – an urban area of the city, where the median price rises to $635,0
- Charleston – best for Airbnb rentals, the median price is $803,000alt-text: a neighborhood to invest in when looking at Boston real estate market;
- Caption: Choosing a profitable neighborhood means the property is valued more. Pick wisel
Types of housing
In the end, you’ll want to narrow down to a particular type of housing you want to purchase. Keep in mind, however, that Boston is considered to be a college town, so prevalent housing rental options are condos and apartments. These two will be the prevailing type this year as well, so there won’t be any surprises. In fact, 70% of Boston’s real estate sales are exactly condos and apartments. If you’re a beginner investor, this type of property will be easy to manage, so you won’t feel as overwhelmed. All in all, they are a great way of breaking into the local real estate market. You never know whether the next property purchase opportunity is right around the corner.
Author bio: Becky Hill is a seasoned SEO expert in the area of international relocation. She runs numerous blogs for moving companies such as verifiedmovers.com and helps them connect with their potential clients. Her articles are informative and communicate effectively with the audience. She runs a Facebook page where she’s freely sharing her wisdom on moving-related topics.