Why Look at Rental Market Data?
Most people who look at the real estate market know that prices have been going up for some time, (8-9 years approximately), and that sooner or later, there will be a pull back. While I expect that the pull back will be relatively modest, that doesn't mean it'll be fun. It will be painful- they all are - but probably not as bad as the last one by a long shot, as there are fewer "bad products" in the mortgage market, and credit is not easy in this environment.
Still though, when might we see a top? A lot of the hallmarks of any real estate pull back or recovery can be seen by looking at rental data. When rents fall, there is less pressure on tenants to move into homes for price security. That takes a lot of buyers out of the market, and has large ripple effects through the Purchase market.
Rental Market Data
OK, so let's look at some numbers and see what they say.
Rentals in Framingham, Marlborough, Natick and Hopkinton
- Currently active: 82
- Past 6 months: 318
- Rental rate: $1.07 (This is what tenants pay for space, in terms of $ per month per square foot).
- Rental time: 28 days
Let's see what it looked like last year. at this time
- Past 6 months: 278
- Rental rate: .97
- rental time:26
This show rents are up about 10%, and there were more rentals than last year, but not by a huge chunk. If I look at the last 3 months, I see rents are down from the spring peak, a little closer to $1 a square foot, but the time to rental is about the same.
These numbers are worth watching going forward, but right now, they don't show any impending weakness. Perhaps a stabling market, but we'll need to see where prices go next spring to be sure.