RENTS UP AS ECONOMY SLIPS

By Jenny Speer

BACK BAY – Jessie Pernick hates the idea of having to move, even if it means she has to cut back on small luxuries.

“I’ve had to make adjustments,” said Pernick, 24, of the $175 per month increase in her rent at her one-bedroom Commonwealth Avenue apartment. “But if I have to forego a night out or two to stay here, that’s fine. I’m safe and comfortable, and that’s important.”

As the economy continues to deteriorate, more people are choosing to rent instead of buy. This increased demand has driven up rents and caused rental agents like Holly Ellard, a rental associate at Charlesgate Realty Group, to put in extra hours. Rents in the Back Bay have risen by 6 percent since January, she said, which has helped her business by raising her commissions.

On a Sunday afternoon, Ellard sat down at the bar at Stephanie’s on Newbury. After her first Sunday showing in months, she took some time to unwind.

"I never work Sundays," she said. "But that's just how it is right now."

Rents in the neighborhood have been rising since 2006, as the median advertised asking rent jumped 5 percent from $1995 to $2100 between 2006 and 2007, according to the Department of Development’s 2007 real estate trends report. This figure ranks the Back Bay as the second most expensive neighborhood in Boston. The Department of Development could not be reached for comment on 2008’s trends.

Despite the perks of living in the area, some former residents chose to leave after their rents spiked.

“I had a certain amount I was willing to pay,” said Brittany Wiggins, 22, who left for Allston in September after rent on her two-bedroom Commonwealth Avenue apartment increased by $100 per month. “I told my roommate I’d live with her somewhere cheaper, but she didn’t want to leave, so I moved out.”

The credit crunch also has some residents with mortgages reconsidering their options. Rich O’Brien, 45, looked into renting his Marlborough Street apartment when he was considering moving to Chicago.

“I had a potential tenant willing to pay more than the asking price I had in mind within a week,” he said. “And that was before I even decided whether or not I was moving.”
The National Association of Realtors reports that there are 4,188 dwellings currently occupied by renters in the Back Bay and 52 up for rent with an average residential turnover of 22 percent. Many residents have chosen to make sacrifices elsewhere in their budgets to hold on to their coveted addresses.

For many residents, the convenience of living in the neighborhood is enough to compensate for the high price of residency.

“I can walk or take a short cab to work from my place,” said Adam Hark, 37, a partner at MerchantPortfolios.com on Beacon Street who lives on Commonwealth Avenue. “Saving money on transportation might not totally even out the rent, but I don’t think I could be any further away from my office.”

Though Ellard said that the fall and winter months show a lower demand for rentals, she is confident that the number of available rentals will remain small – if not decrease – in coming months.

“I do not have to convince people to live in the Back Bay,” she said. “There is and always will be a high demand for this area. It sells itself.”