Somerville is one of the few neighborhoods where average rent price has not hit an all-time high thus far in 2022. Somerville’s current record for highest rent price was recorded in April of 2020, when average rent reached $2,665. At the current pace of price growth, Somerville would eclipse that previous record sometime in late October, which is likely to happen considering the market for Tufts students will keep demand strong over the next few months.
Somerville Rental Market Forecast 2023 and Beyond
In the short-term, the rental market data in Somerville MA suggests that we will be looking at a very tight rental market for Fall 2022. Tufts students will be looking at much less inventory in Somerville and Medford than they have seen in previous years, which will continue to push prices higher as we near the end of the year.
The long-term rental market outlook for Somerville appears less certain. Low apartment inventory and rising rent prices are usually the signs of a strong and healthy rental market, but one can’t help but get the feeling that tougher times are ahead. Inflation is running rampant, interest rates are rising, and our economy is entering a recession. This will eventually lead to corporate layoffs and demand destruction, the extent of which we have yet to see.
For now, prices are rising thanks to a strong demand for rental apartments in Somerville. As interest rates continue to rise, more potential buyers will be pushed towards renting, which could create additional demand pressures on the already desperately low inventory of available apartments.
Somerville’s apartment developers have been quite active in the permitting process for the Union Square area. While this could help increase apartment supply in a tight Somerville market; numerous developers have been worried about excessive inflation and high energy and material costs halting the ground breaking process. The labor participation rate has been lower than expected….