Blog :: 2020

How is COVID-19 Impacting Boston's Real Estate Market?

The COVID-19 pandemic has had, and will continue to have, a major impact on Boston's real estate market. Many different factors are at play. Most of the effects are having negative impacts on the market, such as increased unemployment in certain industries, slowed/stopped construction and widespread uncertainty about how much damage the pandemic will inflict on the economy and how long it will list. However, there are also a few side effects having a positive impact, such as the lowering of interest rates. 

The impact of this pandemic is only just starting to be felt. Looking at Boston's condo market, in the first quarter of this year, we actually saw more closed sales and more condos go under agreement this year than last year. However, we saw fewer listings come on the market.
 


 

While the first confirmed case of COVID-19 in Boston was made on February 1st, many of the office/business closures and government-ordered restrictions did not come into place until March. In the beginning of March, in fact, the Boston condo market seemed to be performing very well and we actually saw more new listings come on the market than over the same period year. However, that quickly changed.
 


 

Looking at some major milestones in the month of March (see chart below), we get a better picture behind the slow-down.  

 


 

Currently, open houses are essentially prohibited due to the restrictions against public gatherings. Showings in and of themselves are also challenging, if not impossible, given the circumstances. Based on the slow down of new listings, and the challenges involved with showing the units there are on the market, we expect that the number of new units that go under agreement and the number of closed sales in the second quarter of the year to be lower than in last year's second quarter. 

It is too early to tell though where we will see sale prices trend. Certainly, as mentioned above, there are negative effects on the real estate market due to the epidemic, including that many businesses are closed which has severely increased the unemployment rate and forced others to accept pay decreases; the stock market has gone down substantially and some people that may have had their "down payment" funds in stocks saw those funds shrink; and there is continued uncertainty about the impact this pandemic will have on the economy and for how long.  

However, certain effects are pushing in the opposite direction. For instance, interest rates are extremely low, which presents favorable financing opportunities; while it is only temporary, the construction work-stoppages are further slowing the delivery of much needed additional supply of housing units; and some of the industries that comprise Boston's workforce may not be impacted as greatly by job and profit losses, which may insulate Boston more than some other parts of the country, as the medical, pharmaceutical, biotech and technology industries are all being called upon to help steer us through this pandemic.

It is also too early to tell what the second half to the year will bring. We have clients that were planning to bring their properties to market this Spring, but have decided to hold off until the COVID-19 concerns subside. We may see volume in the Summer and Fall this year turn out to be higher than in years past.

As always, we will continue to watch and monitor the market. Please reach out to us with any questions you may have on the market or if you have a property you plan to sell and want to discuss timing strategy.

 

 

Home Search During COVID-19 Outbreak

These days it feels that life has been put on hold, as a lot of things we used to do are restricted or stopped altogether. That being said, people still have to move, and we are hearing daily from prospective buyers, sellers and renters. 

Real estate agents, and the real estate industry as a whole, is adapting quickly to what is going on in the world and people's lives, and we are here to help. In an era of social distancing, here are a few things to keep in mind when looking for a home:

1. Video Tours. Video tours are available for many properties, especially Cabot & Company's exclusive listings. Thanks to our agents and tenants, we have compiled a database of videos for the majority of our available apartments. 

2. Experienced Agents. Our agents know our exclusively listed properties inside-out. At a time when it is important to carefully evaluate a property before scheduling an in person viewing, it is important to work with someone that knows the apartment and has personally seen it. For our exclusive listings, we have seen and rented them multiple times, so call your agent with questions. 

3. Further Evaluating Occupied Apartments. Given the current circumstances, it is difficult to visit occupied apartments. Agents, tenants and landlords are all trying to be safe and responsible. At Cabot & Company, we are endeavoring to practice social distancing. Most current tenants are understanding of the circumstances and are happy to assist us in answering your questions and sending additional photos or videos.

4. Visiting a Vacant Apartment. We are doing our best to help you screen properties before scheduling a tour. Ask for a video first. Still interested and want to view it in person? Be prepared for the following: 

- You may be asked whether you have traveled recently, or have any reason to believe you have been exposed or are exhibiting CODIV-19 symptoms.  

- You may be asked to use hand sanitizer before and during the tour, and wear gloves or a mask (if available).

- You will likely be asked not to touch anything. Many agents are turning on all lights and opening all doors and closets ahead of time.

- Any showings are encouraged to be prompt. Take a quick look around, and then discuss any questions outside. Your agent will also be happy to answer follow up questions via email or on a phone call.

 

This is a challenging time, but it does not mean your home search needs to be put on hold. We are all working to navigate through the COVID-19 outbreak together. Do not hesitate to reach out with any questions or suggestions on how we can further help with you house hunting.

 

 

 

Fun Museums to Visit this Fast Approaching Spring!

With spring approaching everyone is looking for fun activities to do in the city. Boston has over 60 different museums that fit a variety of interests. From modern art museums, to historical museums, to a world famous science museum, and everything in between, Boston truly has a rich and cultured range of museums.  Here is a list of some of them: 

 

Kid friendly

 

  • Museum of Science - www.mos.org
  • Boston Children’s Museum - www.bostonchildrensmuseum.org
  • New England Aquarium - www.neaq.org

 

 

 

 

 

 

Art

Museum of Fine Arts - www.mfa.org

Isabella Stewart Gardner Museum - www.gardnermuseum.org

Institute of Contemporary Art - www.icaboston.org

Harvard Art Museum - www.harvardartmuseums.org

 

 

 

 

 

History

  • USS Constitution - ussconstitutionmuseum.org
  • Harvard Museum of Natural History - www.hmnh.harvard.edu
  • The Paul Revere House - www.paulreverehouse.org
  • JFK Library Museum - www.jfklibrary.org
  • Boston Tea Party Ship and Museum - www.bostonteapartyship.com
  • The Mapparium - www.mbelibrary.org
  • Old State House - www.bostonhistory.org

Boston Office Rents – March 2020 Update

Demand for Boston office space is still high, and we have seen rent rates continue to rise.  The chart below is based on available data, but in practice we generally are not seeing the large gap in rents between Kendall Square and Harvard Square from Back Bay and the Seaport District that the chart indicates.
 

Office Rent Rates

Source: CoStar

 

With companies' office needs changing, many tenants are seeking to do shorter term leases than the 3-5 year minimum commitments that landlords generally prefer.  Companies looking for a long-term lease may consider one of the neighborhoods that has not seen rents increase as quickly as others, since they can present opportunities to lock in at a lower rate than that area might see.  

As rent rates continue to rise and with interest rates at record lows, it is also a great time for businesses to evaluate options to buy their office space rather than leasing.  Those opportunities can be harder to find, but they are out there - contact us to help you with that search.

 

 

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Green Thumb or Not? Low Maintenance House Plants

As we are moving past this mild Winter and quickly approaching Spring, many of you are in the green thumb mode and in need to re-amp or add to your indoor vegetation.  Maybe you once had an indoor plant and you noticed within the week that it turned into a bone-dry, wilted mess.  Or maybe you’ve never owned an indoor plant because you aren’t sure if you can keep it alive.  Don’t beat yourself up!  Like a pet, knowing the care for your houseplants starts with finding the right one for you and your schedule.  You may need an indoor plant that can live through your busy work schedule or a houseplant that can survive a week while you are on vacation, greeting you when you get home.  Here are a few plants that are low maintenance and that can instantly add vibrancy and color to your living space.


1)  Spider Plant
This plant thrives in the sun/well-lit areas.  Water every 2-6 weeks or when the top 2-inches of soil is dry.  Be careful not to over water as this can cause root rot.  This plant likes temperatures between 70-85 degrees Fahrenheit.
 


 


 

2)  Aloe Vera
This plant likes light, but not direct sunlight.  Water every 1-2 weeks and maybe once every 2 months in the Winter.  You want to make sure the soil is almost completely dry before re-watering.  This plant likes temperatures between 50-70 degrees Fahrenheit.


 

3)  Jade Plant "Shrek Ears"
This plant likes indirect sunlight.  Like the Aloe Vera, only water this plant when the soil is almost completely dry or every 1-3 weeks.  This plant likes temperatures between 65-75 degrees Fahrenheit. 
 

4)  Succulents
Succulents like lower amounts of sunlight, maybe 3 hours per day.  These plants like water at least once a week.  Temperatures between 60-80 degrees Fahrenheit is the best for this houseplant.
 



5)  Dragon Tree

This tree needs very little to no sunlight.  It can also thrive in filtered light conditions.  60-85 degrees Fahrenheit is ideal for this low maintenance plant.  Just watch the soil of this tree and keep it moist.  Needs water maybe twice per month.


 


 

Not only do houseplants add vibrancy and color to your home or apartment, but study after study shows that plants (in our living or office environment) can improve our overall well-being, making us feel better.  These plants can also take out toxins from the air we breathe.  We are less stressed, more productive/creative when we share our living space with a simple, low maintenance houseplant.

 

 

Staying in Shape in the Back Bay

How’s your 2020 vision?  I am referring to your New Year’s Resolutions.  If it’s out of focus as January moves into the rear view mirror, you can take a little wisdom from T.S. Elliot who said “Every moment is a fresh beginning.” 
 

If you need to reset or start those New Year’s Resolutions with your work out goals, here are a few options in the Back Bay:

 

Spinning

Health Clubs

Fitness Studios

Boxing

Yoga


In the summertime, Healthworks offers free workouts on The Rose Kennedy Greenway, The Esplanade, and Boat Yoga on the Boston Harbor. 

 

 

Riding the Seaport "Wave"

The Seaport District has seen tremendous growth and opportunity over the past five years, and its known as one of Boston’s fastest growing neighborhoods.  Those that purchased a condo here a few years ago have seen a large increase in their investment – the average condo sale price has increased over 133% since 2015.  
 


Data Source: MLS Property Information Network, Inc.


Nearby neighborhoods such as South Boston, Dorchester and Quincy have seen a lot of transformation over the past few years as well.  New developments and condo conversions in these neighborhoods, as well as the arrival of trendy restaurants and bars, have attracted buyers.  They have not yet seen the same amount of growth as the Seaport, but they seem poised to ride this Seaport “wave” and increase in value as well.  

 

 

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How Much are Retail Rents in Boston - January 2020 Update

Most retail rents in Boston are quoted in terms of rent per square foot per year.  For example, leasing a 1,000 SF space for $60/SF would mean the annual rent is $60,000 - or $5,000 per month.  Most retail leases in Boston are triple net (or NNN), meaning that the tenant also pays all or a portion of the real estate taxes and common area maintenance (CAM) for the building.
 

Market Rent for Retail Space ($/SF)

Source: CoStar, January 24, 2020


Boston's Back Bay, driven mainly by Newbury and Boylston Streets, is still the priciest neighborhood in Boston.  The average numbers shown above are just that - "averages" - and we see deals close above these levels on Newbury and Boylston Streets.  Overall, neighborhoods/areas have mainly all followed a similar cycle.  As the chart shows, retail rents in most areas are expected to level off and remain steady for the next few years.  

The "best" retail location for a business is not necessarily in the neighborhood offering the lowest rent.  It's great if the rent is lower than in other neighborhoods, but your sales must still be strong enough to support the rent (generally speaking, rents are lower in areas where most businesses expect sales to be lower due to various factors, such as foot traffic and daytime population).  As part of your site selection process, it is important to consider your target consumer(s) and determine whether you will be able to effective reach/serve them at the locations you are considering.  This is something we are happy to help you evaluate and consider - feel free to contact us to discuss.

Are you searching for retail space for lease in Boston?  You can start your search here.

 

 

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Why You Should Hire an Interior Designer

Deciding to hire an interior designer can not only increase the value of your home, but can also help you avoid some costly mistakes. Interior design is a crucial component when selling your home; it can boost buyer appeal, which can increase the value of your home.

If you’ve invested a good deal of money in your home, you will want to showcase it to look its best to prospective buyers. A designer offers a fresh set of eyes, trained to see things that you may not. In addition, professional designers have expertise in budgeting and planning, plus they bring an extensive list of resources for your renovation. They are invaluable in saving clients in time and headaches, identifying reliable contractors, plumbers, and electricians for their projects.

Lastly, a designer can offer you the “wow” factor. They can offer something outside of the box, that you would never think of, as a result of their trained eye and years of experience.

 

 

 

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First Look at Final 2019 Condo Sales Data

Happy New Year!  We are still digesting all of the data, but here is a quick look at how Boston’s condo market performed in 2019.  Looking at a sample of neighborhoods, average condo sales prices per square foot were slightly below 2018 levels in a number of them.  There are certainly areas that experienced growth - for instance, the average condo sale price per square foot in Jamaica Plain was up 2.5% in 2019.  At $536.38 per square foot, the average condo sale price in Jamaica Plain is still half as much as Beacon Hill ($1,212.32/SF), Back Bay ($1,247.61) and South End ($1,030.86).
 


Source: Based on data compiled by MLS Property Information Network, Inc.

 

The number of sale transactions was lower in many neighborhoods.  The number of condo sales in South Boston was down 14%, but South Boston still saw more sales than many other neighborhoods.
 


Source: Based on data compiled by MLS Property Information Network, Inc.

 

Check back with us!  We continuously review data to help identify trends and potential opportunities!

 

 

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