With Spring in full swing, the real estate market is getting especially busy — as it tends to do this time of year. With that, it’s time to ask the age-old question: are you better off renting or buying/owning in the Boston area?
Around March through June, demand tends to shoot up as leases end and prospective home owners and renters seek new digs. Fortunately for those people, Boston is in the middle of a major building boom right now. Nonetheless renting ain’t easy in Beantown. As we speak, major projects such as that at 35 Lomasney Way, Washington Village, South Station tower, and Bulfinch Crossing are getting underway or are expected to pick up their construction pace toward scheduled openings in 2018 or shortly after. All these developments will make for a rather spicy market as the city expands its residential options. So with that, let’s have a closer look at the market so we can answer this question: Rent or own?
Rental Market Blues
For the umpteenth time, the rental market in Boston continues to be considered one of the priciest in the nation — not exactly music to the ears of apartment hunters. The latest monthly report from real estate listings site Zumper offers us a glimpse into just how much apartments cost in the city. According to Zumper, Boston ranks third in the nation behind San Francisco and New York in the cost of renting a 1-BR apartment. Fortunately for prospective renters, the $2,250 median rent for a 1-BR represents a 1.3 percent drop from February; and the $2,600 median rent for a 2-BR was essentially unchanged from February into March, rising only 0.4 percent. So in that regard, renting continues to be about as good an option as last year. Here are a few developments for potential renters.
Piano Craft Guild
There are still some vacancies in this 177-unit, six-story development. One-bedrooms start at $2,500; 2-BRs at $3,300; and 3-BRs at $4,600.
The 240-unit, four-year-old development has at least a dozen studios, 1-BRs, and 2-BRs available. Studios start at $2,646; 1-BRs at $3,187; and 2-BRs at $3,846.
AVA Theater District
This 398-unit building was the largest apartment complex to open in Boston in 2015. There are still a number of units available now. Studios start at $2,550; 1-BRs at $2,539; and 2-BRs at $3,435.
While these options are especially enticing, and while Boston continues to undergo a nice facelift, there’s just too much demand, too little supply, and too many potential tenants able to pay the high monthly amounts. Consensus says that renting in greater Boston is a nightmare — and it’s less due to high costs and more due to just plain scarcity. It is this scarcity that has sent Boston rents soaring, and prospective tenants running.
Buy Me a River
Still with that in mind, does it mean that it’s better to buy? Here are some questions you might want to ask yourself before going forward with purchasing your shiny new home.
- How much is permanence worth to you? Owning a home can give you peace of mind and more control—owners can pretty much do anything they want within the four walls of their homes. Renters, however, are generally at the mercy of their landlords.
- How confident are you that you’ll stick around? Buying a home tends to be a long term investment. This is because buyers need to cover the closing costs they might incur and the investment loss that comes with putting their savings into a down payment on a home. Plus there’s that pesky broker’s commission if you decide to sell.
- How confident are you about your future income? Any number of things can happen to homeowners. For renters, losing a job or income only affects the remainder of a lease; whereas home-owners can face all sorts of darker troubles like foreclosure, eviction, and bad credit.
Whatever your situation, it’s important to consider the long term — buying a home requires you to look into the future and ask a potentially maddening question: where do you see yourself in ten years, twenty years, thirty years? It’s a major commitment. And beyond that, if you’re looking to buy the median-priced condo in Boston Proper, you’ll need to pay a $100,000 down payment — which is out of the question for many — and if you’re looking to settle out in the suburbs, you’ll need to have savings of up to $50,000.
Obviously, then, the answer to our question isn’t so simple. It depends a whole heck of a lot on your income, your career trajectory, your savings, your willingness to commit to a long-term investment, your ability to pay those costly monthly rents, and a whole host of other variables. Whatever direction you choose, make sure you give it as much thought and consideration as possible. Because, as we’ve demonstrated, it ain’t easy living in Boston.