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Market Report

Boston Multifamily Market Report

2025 Investment Forecast

Investor Confidence Rises as Reduced Inflation
and Stable Household Growth Tighten Market Conditions

Low supply and stable demand support optimistic outlook. Boston’s more cycle-resistant economy, led by world-class educational and health care institutions, is expected to sustain rental demand despite broader uncertainties. The appeal for urban living is being aided by a vibrant local retail environment, as well as the rise in return-to-office mandates and corporate expansions by firms such as Amazon and Moderna. Growing business hubs with lower housing costs like Waltham — highlighted by Welch’s planned relocation to the area this spring — should also attract renters to the suburbs. These factors will keep apartment demand ahead of new supply, with inventory growth projected to remain under 2 percent for the fifth consecutive year. Despite the MBTA Communities zoning law removing impediments to development, high construction and financing costs have tempered these efforts. However, a statewide $5 billion bill passed last year may spark activity by funding affordable housing, incentivizing conversions and legalizing accessory dwelling units. In the near-term, rising household formation as inflationary pressures ease should help tighten vacancy and improve rent growth.
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