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Boston is one of the worst cities for small-time property investors

by Emily Johnson, Taylor Johnson Public Rrelations

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In the overwhelming majority of cities, investors can buy an average home and reasonably expect to make a profit while renting it out. That’s not the case in Boston, however.

Boston is just one of 10 cities in the U.S. where it doesn’t necessarily pay to be a landlord, according to Zillow. In 25 of the 35 biggest cities in the country, at least 70 percent of the homes could be rented out for more than its monthly expenses. In 17 markets, at least 90 percent of houses could be rented out at a profit.

That’s not the case in Boston, where only 45 percent of homes could be rented out at a profit, Zillow reports.

Boston is one of nine markets where less than half of existing homes could be rented out at a profit. All of those markets are considered the most expensive in the country. Boston, generally considered the third most expensive market behind New York and San Francisco, has homes that are simply too expensive to be turned into rental units that make a profit, especially when factoring in costs like taxes, ownership fees and maintenance, Zillow reports.

“Nationwide, the full purchase price of the average home is equivalent to 11 years of the median U.S. rental payment,” Zillow’s report reads. “In the most expensive markets, it would take almost double that length of time – more than 20 years of rental payments – to pay for the price of a home in full.”

Despite being an overall unaffordable city, there are pockets of Boston with a high percentage of homes that could turn a profit on the rental market. Like in other expensive cities, those areas are far away from the city center, or are not located in the city proper at all.

Lawrence, a north suburb, has a large concentration of investor properties that could turn a monthly profit, as does Lowell, according to Zillow.

Check out Zillow’s map of where affordable investment properties can be found in the Boston area:

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