August 2025 Update | Multifamily Market Report

Boston Multifamily Market Overview

The Boston multifamily market is showing renewed strength as of August, with steady leasing activity pushing vacancy rates down and supporting rent growth. Over the ﬁrst half of the year, absorption followed a positive trend, with 938 units absorbed so far in the third quarter. Demand has been strongest in the Somerville/Charlestown and Allston/Brighton submarkets. Vacancy has tightened to 6.2% and rent growth notes a rate of 2.1% year-over-year, driving the market rent to the current level of $2,964 per unit. Investor conﬁdence has held ﬁrm, supported by continued liquidity and notable sales of top-tier assets, reinforcing Boston’s position as one of the most resilient major multifamily markets in the country.

Highlights

New residents aided the metro in 2024, with the addition of 62,737 citizens—the largest population uptick since the early 2000s.
Metro West, Lowell/Dracut, and Lawrence/Haverhill record the highest rent growth in the 4% to 5% range.
The multifamily construction pipeline has reached its lowest point in years, with about 14,000 units underway in the third quarter so far.
The Seaport District and Kendall Square areas are hotspots for biotech employment opportunities as new lab space and capital are being added.

Vacancy

Boston’s apartment vacancy rate has compressed to 6.2% so far in the third quarter, down approximately 100 basis points over the past year as supply and demand return to balance. While still above its historical average of 5.4%, the market continues to outperform the national vacancy rate of 8.2%. Strength in local demographics, highlighted by 2024’s largest population gain since the early 2000s, has fueled demand across both urban and suburban submarkets. Despite this gain, vacancy still diﬀers across multifamily tiers. Vacancy remains elevated in Class A properties averaging 8.7%, but is expected to decrease through the rest of the year, while Class B vacancy averages 5.4%.

Boston Vacancy Rate

Source: CoStar Group, Inc.

Rent

Rents across Boston are forecast to accelerate, with year-over-year rent growth at 2.1%, outpacing the national ﬁgure of just 1.0%. At an average of $2,964 per month, Boston remains one of the most expensive multifamily markets in the country, trailing NYC and San Francisco. Rents are expected to regain momentum in late 2025 as the supply pipeline eases and fundamentals tighten. Suburban areas such as Metro West and the northern suburbs have posted outsized gains, with annual rent growth of 4–5%, while urban submarkets like South Boston/Seaport have lagged.

Boston Rent Per Unit and Rent Growth

Source: CoStar Group, Inc.

Construction

Multifamily construction in Boston has begun to cool, with 7,300 units delivered in 2024, the smallest annual total since 2016 and below the metro’s 10-year average. Currently, about 14,000 units remain under construction, equal to 5.3% of inventory, with nearly 40% concentrated in the Everett/Malden/Medford/Melrose, Route 1 North, 93 North, and Somerville/Charlestown submarkets. Unlike the past cycle, when luxury projects dominated, developers have shifted strategically, with roughly 30% of today’s pipeline consisting of Class B/C developments aimed at more attainable product.

Units Under Construction

Source: CoStar Group, Inc.

Multifamily Transactions

The $4.5 billion in sales recorded over the past 12 months has surpassed the $3.4 billion level from 2023. Private capital investors remain the top buyers, followed by public and institutional investors. The current market sale price of $454,000 per unit has fallen from previous levels recorded in Boston. The largest transaction in July occurred at 3200 Washington St. in the Egleston Square submarket. The Class A property consists of 73 units, and it sold for $37.8 million, or $517,808 per unit.