Salem, MA Rental Market Trends 2025 – What Renters & Investors Should Know
Rental Market Trends in Salem, MA (2025)
Salem, Massachusetts is drawing increasing attention in the Greater Boston rental sphere. With its historic charm, strong regional connections, and evolving housing supply, the city’s rental dynamics are shifting. Here’s a deep dive into what’s happening now — and what renters, landlords, and investors should watch.
1. Current Average Rents & YoY Changes
- Across all unit types, Salem’s median rent is approximately $2,722 (per Zumper) — a ~20% increase year-over-year.
- Apartments.com reports average rents at $2,190 for one-bedrooms and $2,655 for two-bedrooms. These figures reflect a modest ~1.6% annual rise.
- RentCafe cites an average apartment rent of $2,797 (as of mid-2025) with a typical unit size of ~916 sq ft.
- According to Zillow’s “rental manager” data, the average rent in Salem is $2,696, which is ~32% above the U.S. average.
- Recent monthly movement has been modest or slightly negative: Zumper notes a ~2% decline month-over-month.
- In downtown Salem, the median rent is ~$2,750, a ~1% YoY increase.
Takeaway: Rents remain strong, especially in centrally located or newer/renovated buildings, though monthly fluctuations suggest some softening or stabilization.
2. Rent by Unit Type & Neighborhood
| Unit Type/Area | Typical Rent | Trend / Notes |
|---|---|---|
| Studio | ~$1,800 | Up ~5.4% YoY |
| 1-Bedroom | ~$2,190–$2,200 | Modest increases, ~1–3% YoY |
| 2-Bedroom | ~$2,650–$2,700 | Some softening reported (RentHop notes a ~2.5% drop) |
| 3-Bedroom+ | ~$3,000+ | Higher-end / family units and houses command a premium |
| Downtown / Central Salem | ~$2,750 median | Slight yearly gains |
In the 01970 ZIP code, one-bed rents have actually declined ~11% YoY, while two-bed units rose ~10.7%.
Many Salem rentals are in historic buildings or older inventory. According to Point2Homes, ~46% of Salem’s rental stock was built prior to 1940, followed by periods from the 1970s onward.
3. Supply, Vacancy & Market Temperature
- The vacancy rate in Salem is relatively low — ~1.7%.
- Zillow’s rental-manager “market temperature” labels Salem’s rental market as “COOL,” meaning demand is somewhat subdued relative to peak periods.
- Current listings in Salem are robust: ~163 active rentals per Zillow.
- Zillow’s rental inventory shows rents for 1–2 beds ranging from ~$2,150 to ~$3,300 in many modern or amenitized buildings.
These conditions suggest modest slack in the premium segment, while basic units remain tight.
4. Drivers & Influences Shaping the Market
- Housing Costs & Homebuying Barriers - With median home prices in Salem hovering near $550K-$600K, many households opt to rent longer.
- Proximity to Boston / Commuter Appeal - Salem’s access to the North Shore and MBTA connections make it a desirable location for renters employed in Boston or nearby employment centers.
- Aging Inventory & Renovation Premiums - Many buildings date from earlier eras, so renovated or modernized units command a premium. Landlords investing in upgrades (e.g. in-unit laundry, HVAC, modern finishes) see better returns.
- Regulatory & Policy Context - Salem offers some affordable housing programs and income-qualified rental units.
- Local planning docs also note strong demand for single-family rentals and limited growth in new multifamily zoning.
- Short-Term / Vacation Rental Impact
- Salem’s tourism draws (e.g. Salem Witch Trials, historical tours) feed a parallel short-term rental (STR) market. Airbnb and VRBO data suggest ~59% average occupancy, with daily rates around ~$334.
- Other sources (AirROI) show ~305 active listings with ADR ~$325 and ~51% occupancy.
This STR activity can reduce the effective supply for long-term renters in desirable locations.
5. Projections & Risks
Projections for 2026:
- Rents may continue to rise modestly (3–6% range) in desirable or renovated units.
- Pressures on older or poorly maintained units may push landlords to invest or face vacancy.
- Downtown / premium locations likely to outperform peripheral areas.
- STR regulation or taxation changes could feed supply back into the long-term rental pool.
Risks & headwinds:
- Rising interest rates may dampen investment in new multifamily supply.
- A softening in job growth or broader economic uncertainty could slow tenant income growth.
- Potential regulatory interventions on rent control or STR restrictions.
- Overbuilding of new luxury units could compress premiums.
6. Tips for Renters & Landlords
For Renters:
- Be flexible on location — peripheral or less trendy neighborhoods may offer better value.
- Ask about included amenities (laundry, parking, utilities) when comparing condo vs. older units.
- Lock in multi-year leases where possible if you expect rent increases.
- Monitor STR conversions — some buildings may shift use over time.
For Landlords / Investors:
- Focus on modernization and energy efficiency upgrades to justify higher rents.
- Market units aggressively, with good photos and digital tours: listings in Salem often list above $2,000 for standard units.
- Consider hybrid models: allowing short-term or furnished leasing when demand is high.
- Keep abreast of zoning and housing policy changes from the city.
Conclusion
The rental market in Salem, MA in 2025 remains strong — especially for well-maintained, centrally located, or upgraded units. While average rents are among the higher tiers in Massachusetts, modest monthly softening suggests the market may be entering a stabilization phase. For those positioning themselves wisely — renters seeking value, landlords investing smartly — there remains opportunity in this historic coastal city.
