Welcome to the Cambridge Housing Market, Part 1

Hey guys,

I’ve been wanting to write this blog literally since I moved to the city, before I even had a website to which to post it. Boston’s housing market was such a nightmare to try to wade through without any prior knowledge. I knew I’d write about it at some point because I want to give others a head’s up. I want them to know what they can expect.

This blog is specifically meant for those who are currently in the process of moving to Cambridge or Somerville or are thinking about it. Others might find it interesting, too, in the way that looking at a massive wreck on the interstate is interesting.

Also, even though I am speaking directly about Cambridge and Somerville because of my own experiences, a lot of this can be applied to the other neighborhoods (i.e.: North End, South End, Brighton, Brookline, Allston, Jamaica Plains, Back Bay, Fenway).

Now, I’m in an unusual position for a graduate student. I am currently renting an apartment with my roommates, but I am also in the process of buying a condo. In Part 1, I’ll talk about the renting situation because that is most likely where everyone’s going to start. I’m currently about half-way through the the condo-buying process. When I’m done (about mid-May), I’ll make Part 2 and compare what the housing market in Cambridge is like to the renting market, why I decided to make this monstrous commitment as a graduate student, and what the buying process entails.

Renting in Cambridge

Coming from a city where the housing/renting market was increasingly high supply and medium to increasing demand, I have to say that the Cambridge housing market is scary. I present the following comparison:

In Atlanta, for $1200/month, I could afford a luxury 1-bedroom apartment in the heart of Midtown only a mile from school. That came with laundry, parking, a pool, a gym, some fitness classes taught in that gym for free, and a bunch of other amenities.

For $1100/month in Cambridge, I can afford a bedroom in a mid-tier three-bedroom apartment, with my other roommates paying about as much (I have two cats, so I’m paying the pet fee), for $3250/month total.

This article is a comparison of what $2,500/month gets you in various areas around Cambridge, and the picture below compares the price of 1-bedroom apartments across Boston.

Boston’s housing market is a mess for several reasons. Allow me to lay down some context about the city, and we can try to figure out why the market is so abysmal.

The first reason the housing market is such a wreck is that Cambridge is old. The people might be young, but the city is like the old man yelling “get off my lawn!” to housing developers.

Allston is the center for Boston’s famous brownstone buildings, but the majority of housing in Cambridge and Somerville is capped at 3-stories.

The image below is an aerial shot of someplace in Somerville, but it essentially represents the entire neighborhood and the majority of Cambridge.

The dominant property style is the “2/3-family home”. Like I said, Boston is old. Back in the day (like the late 1800s), families were big and lived in these 3-floor style homes. As the city grew and families shrunk, these 3-floor, single-family homes were converted into 2 split-floor apartments or 3 single-floor-apartment buildings. Old homes are torn down and newer 3-family homes replace them

I haven’t found an article stating this specifically, but a friend who’s lived in the city for nearly a decade told me that historical protection laws prevent housing developers from tearing down, like, a block of these old houses and building a mid/high-rise that could double, triple, or quadruple the number of available apartments for the same land space. The few mid/high-rises that do get built end up costing a fortune. An apartment in the high-rise might start at a 200% mark-up (but can easily go much higher) than a 3-family house apartment with the same number of bedrooms. It is now considered “luxury” and you’re paying for all the amenities in the building, but the price increase is so dramatic because the up-front costs to even get access to the land and pay the way around historical protections are massive compared to other cities. Again, this is second-hand information, and I apologize that I don’t have a solid source for it. However, it does explain why the city is only increasing the available housing by an insanely small margin each year and generally on the peripheries of the outer neighborhoods.

If housing developers can’t build new homes, what do they do? Buy older homes as they come on the market, renovate the bejeezus out of them, and then sell them for a 300% mark-up in price. This article talks about Boston’s “preservation architects.” Roughly 70% of an architect’s billable hours in 2015 went into renovating and updating old buildings, not building new ones.

Time to move on to the second factor that contributes most to Boston’s hellish market: There are 81 universities within a 25-mile radius of Boston.

In 2016, about 34.6% of the population is Boston is made up of 20-34 year olds (Austin is the second youngest city at 31%). Of that 34.6%, about 50% (men) – 70% (women) of that age-range is currently enrolled in school, either in undergrad, grad, or post-doc. And these are the stats for Boston. Cambridge’s are higher. I’ve heard people say Boston/Cambridge is the highest-educated city in America. From a 2014 census, 46.5% of people 25yo+ in Boston have at least a Bachelor’s. Half the city is college-educated. For the same demographic in Cambridge, that percentage is 70%. Holy books, Batman! (Sources for these wonderful stats: BRA Research Division, Boston By the Numbers 2015, Demographic and Socio-economic Trends in Boston (2011), 2010 Cambridge Demographics and Stats)

So, roughly a fifth of the city is currently in college. School in New England starts in late-August early-September. Thus, it might make sense when I say that the “moving day” for the entire city and surrounding neighborhoods is September 1st. It’s about the time kids are returning for school and the city is inundated with returning college students.

As a result of this yearly cycle from one of the larger demographics in the city, a lot of the landlords have adopted September to September leases. I remember seeing something like 64% of lease turnovers happen on September 1st. So, there are non-September-based leases out there, and they become more common the further out from major schools that you go. However, if you’re looking to live in Cambridge near Davis Square (Tufts University), Porter/Harvard Square (Harvard University), Central/Kendall Square (MIT)…you might just have to join the Moving Day From Hell like the rest of us.

If you’re going to move, book a U-Haul months in advanced. Trust me on this. The ones in the city go very quickly. Not just U-Hauls, but independent small business movers, too. I’ve seen more than one person who just happens to have a big truck make a lot of money by renting their truck and/or themselves as a mover for the day.

So, not only is every U-Haul from inside the city and probably from a 10-mile radius (my roommates had to drive out of the city about 30 minutes to get the U-Haul) currently in use, but the city also has annoyingly tiny roads. A good number of them are one way with parking on both sides. And because all the cars parked on the street don’t just magically disappear on the Moving Day From Hell, moving vans end up blocking a decent number of the streets, making them impassable.

To my surprise, there is one fun thing that comes out of the Moving Day From Hell: Allston Christmas.

As people move out and in on the same day, they might find that what worked in the old apartment won’t work in the new one. Something might have been broken and they just didn’t want to worry about tossing it out until they moved. It might just be time to upgrade something (like old mattresses, fridges, electronics).

They will literally leave it on the curb for people to take at leisure. The curbs of Boston essentially become first-come first-serve flea markets all across the city. I’ve been calling it the Moving Day From Hell, but locals call this day “Allston Christmas”, named after the neighborhood Allston (which is one of the epicenters for student living).

This article and this one are nice little guides to wading through Allston Christmas, how to smartly contribute to the goods, and how to make intelligent decisions about what you bring into your apartment from the curb. Be smart, people. Check wood for bug damage. I wouldn’t even think about taking in a mattress or fabric sofa/chair for fear of bugs.

Just as a cautionary tale, I had a friend talk about how his friends found a CRV TV on a curb and brought it back (they like it for old-school video games). They plugged it in, and it didn’t work, so they decided to open it up and take a look at the electronics, since they were EE majors. Well, nightmare-fuel time: they took off the back and a bomb of cockroaches exploded all over their apartment. Fun stuff.

Personally, when I find curb-presents (people put one or two things on the curb pretty regularly in my neighborhood), I check wood intensely, and I generally only take plastic or metal items that I can scrub clean back home.

Allston Christmas is also the perfect time to ask your friend if you can snag their stuff before they put it out on the streets.

As far as I can tell, those are the 2 biggest reasons Boston’s housing market is a nightmare: Severely high demand and stagnantly low supply, and when it comes time to move, everybody moves at once.

Now, what are the consequences of these factors?

For those of you preparing to move to the city, I’m about to say something that’s going to make you demonstrably nervous and unhappy.

Because of the high demand/low supply situation, realtors basically have control of the market. A lot of landlords here, rather than deal with the madness themselves, will hire an agent to rent their property for them. You can find housing without dealing with an agent (either your agent helping you find an apartment or dealing with the renter’s agent), but to be honest, it’s difficult. I tried and failed. My roommates and I ended up hiring an agent to find us a place to live. We were also looking late in the season (searching in July for a September lease), so the market was waning.

When you start looking for apartments (preferably with at least one roommate), you should be prepared to pay first month’s rent, last month’s rent, a security deposit equal to one month’s rent, and the agent’s fee, which is also equal to one month’s rent usually (or half-rent, if you’re lucky). The more roommates you have (which goes hand-in-hand with a bigger/costlier apartment, usually), the easier it is to handle this financial Mad-Max scenario you just found yourselves in.

Craigslist is a great place to look for housing. You can select the “no fee” filter and you’ll get a bunch of places that are hosted on the market by the landlord directly, so you can by-pass the middle-men. I know renting a place from craigslist sounds sketchy (it did to me too) and I’m sure there are cases where it doesn’t work out. However, in Boston in generally, it’s actually a pretty reliable resource. 

As you might have already intuited, it is unusual for people in Boston to live alone. Crappy studios and 1-bedrooms generally come onto the market at about the $1300-$1500/month range and they only get more expensive. Just from what I’ve witnessed, it seems like couples often start living together earlier in the relationship in order to save on rent. Again, I can only compare against Atlanta, but it definitely seems more common here.

As with any other city, there is a trade-off between proximity and cost. The closer you are to one of the squares and any of the MBTA lines (Red/Green/Orange/Blue), the more expensive the place is likely to be. The farther out you go from (into Medford, Belmont, Watertown, etc), the places get cheaper and bigger, but you have to deal with longer commutes.

I want to say that particularly with Cambridge, that trade-off is pretty steep. When I first moved to Boston, I found a summer sublet from an ad on Facebook (soooo many housing pages where people advertising rentals and sublets–another good resource). It was a 350sqft 2-bedroom basement apartment for $2000/month in Harvard Square (bills included). This apartment actually warrants a blog post unto itself. I’ll jump to the end of the story and say that both myself and my roommate had to move out on August 31st (she had lived in this apartment for 6 consecutive years) because the landlords were renovating (and I was moving into my actual apartment). My roommate ended up finding a 2,000sqft apartment for $2000/month only 3 miles away in Watertown. Yeah. Quite the upgrade.

In terms of resources, use any and all rental sites that you can stand. I think at the peak of my search, I was receiving daily updates from 5 or 6 different sites. Craigslist, Zillow, HotPads, Trulia, Facebook groups, PadMapper. I think I even used AirBNB when I was searching for a summer sublet prior to finding a September-lease apartment.

If you’re coming into the city and don’t know who you could find to be a roommate, I heavily recommend using one of the roommate-finding sites. EasyRoommate.com and RoomieMatch.com I’ve found to be the most popular, and of course Facebook and Craiglist will also advertise single bedrooms for rent in a 2+ bedroom apartment.

If you want recommendations for the agents I’ve worked with, I’m happy to let you know. I say plural because you might find five listings on Craigslist that look great so you contact the people, and each apartment is listed by a separate realtor agent. You only end up paying the agent connected to the apartment you end up renting, so this means you might have interactions with a dozen or more agents. I was the person in charge of apartment searching among me and my two roommates, and after weeks of looking at apartments, I ended up just contacting one main agent and had them show me around multiple places. It was nice because they got to learn what we were looking for and they narrowed their search until we found the place we have today.

That’s all I really have to say about the renting market at this point. I hope people have found it useful and/or entertaining!

I still haven’t heard back about the video permissions. I’ve started writing that blog as though I do, but at this point I’m not sure I’ll receive copyright permissions. At some point I might just say screw it, write it up, and post it anyway. Ah well.

Cheers!

Z

PS: If you’re interested, this report from 1993 goes into detail about the housing market changes in Mid-Cambridge, which is right after rent-control was tossed out. This was followed by pretty extensive shifts in the housing market, which we’re still riding out today.