Our Multifamily Team is in the field each day going around many Boston neighborhoods learning all about the multifamily and investment markets. Joe DiGangi and Bobby Quinn work with experienced buyers and sellers to help them determine or create great multifamily investment opportunities. What knowledge does this give them about the way the market has changed and advanced so far this year? We sat down with them recently and asked them just that.
What can you tell us about the Multifamily Market in Boston in 2014 so far?
We are finding it very similar to what we saw last year. Boston continues to be one of the top 5 strongest real estate markets nationwide. As a result, many investors (local, national, and international) look to put money to work here due to the perception of stability and long term growth. In 2014, we continued to see a high percentage of the acquisitions being funded by cash from international investors. This strong demand has pushed prices higher and cap rates upon acquisition have leveled off to the mid 4’s to low 5’s in Boston’s premier areas.
As a result, investors are continuing to look for value in the various town surrounding the city such as Revere, Malden, Medford, Everett, Chelsea and Lynn.
Although there are as many as 8,000 units of new construction in the pipeline, supply for existing multifamily housing remains constricted and as such prices have continued to escalate. We are able to work with our clients due to a large inventory of off market opportunities and established connections with property owners in the marketplace.