Aerial view of downtown Boston and the harbor, photo by Kevin Tostado.
Investing across America
Recently, AGBeat columnist Jeff Brown extolled the virtues of investing in Texas and CondoDomain.com President Hoyt Morgan named Washington D.C. as the top city for investing.
There are many reasons a city can be seen as a quality location for investment, and today in the spirit of school starting, we look to Move.com‘s list of Top 10 Best Back to School Real Estate Investment Cities, giving Boston the top spot.
“Pahk the cah in Hahvad Yahd”
So why did Boston take the cake? According to Move:
With a median list price of $335,000 in June 2011, the Boston/Cambridge market has one of the higher median list prices of the bunch, but also has high renter demand from students at over 50 colleges including Harvard and MIT, ranked two and four. The median list price in Boston has dropped by 2.62% since last June. Average rental rates in Boston in June 2011 ranged from $3,122 for a two bedroom to $3,913 for a three or more bedroom unit, both higher than a mortgage payment of around $1,370 for a median-priced home with a 20% down payment and current mortgage rates for a 30-year fixed loan. Boston was also named one of the top 10 turnaround towns by CNN Money in May 2011.
“In Cambridge and some of the Boston Proper neighborhoods we have been seeing rents rising with demand and projections of further increases of up to 25%,” said Boston-area broker owner Paul Turcotte.
Investors will soon outnumber traditional buyers
According to the recent Move, Inc. investor survey, “In the next two years, real estate investors are expected to outnumber traditional homebuyers in their local markets by three to one, and 56.5 percent plan to put their investments to work as rental properties.”
“Local markets with universities or colleges can be an attractive option for many local real estate investors,” said Move, Inc., Chief Executive Officer, Steve Berkowitz. “Housing demand in college towns is generally high and vacancy rates are usually low. Combine the supply and demand ratio with rising admissions and the five percent rise in rental rates expected by the end of the year, and rental property in college towns can be a smart option for the right investor.”