It’s a seller’s market for small to mid-sized multi-family properties in the Boston Metro! According to a recent analysis in Boston Biznow, investment in Boston’s multi-family sector reached $422 million during the past 12 months, beaten only by Orange County, California.
The hottest properties are Class-B and Class-C properties, especially 10 to 20-unit buildings. Such buildings were once primarily owned by local investors, but now the big money is swooping in. Foreign capital, institutional investors and high-net-worth individuals are finding value in Boston’s cap rates, which average 4.5%.
As sellers cash out, renters are facing escalating living costs. New building owners tend to upgrade their newly-purchased properties in some manner, which is invariably followed by higher lease rates. Boston residential rents are up by 14.3% compared to a year ago. This trend is not limited to Boston, however. The same acquisition frenzy has taken place in many other cities in the U.S., leading to a national average rent increase of 15.1%.
Boston’s strong housing demand was already in place well before the pandemic, supported by a robust job market and a well-paid workforce. Continued expansion of the life science industry is expected to add about 15,000 jobs per year through 2025.
Boston Metro investors are also looking at a post-pandemic future that will see office buildings back at full occupancy. With college campuses holding in-person classes, student rentals have already been on the upswing. Residential vacancies are at a mere 4%.
If you are thinking of selling your Boston Metro multi-family or mixed-use property, the timing is right! If you are a real estate investor looking for properties in the Boston Metro, there are still plenty of choices available – let us show them to you!
When you are ready to begin, relocate or expand your business, team up with the Jay Nuss Realty Group, LLC! Whether you are thinking of buying, leasing, or investing in Boston Metro commercial real estate, we can help you find the ideal property, and provide experienced tenant representation!