President Donald Trump’s $3 billion funding freeze on Harvard University is starting to have an impact on the local real estate market in Cambridge, Massachusetts, according to Realtor.com.
Trump’s freeze on grants and contracts on the esteemed Ivy League institution threatens to affect the ecosystem of start-ups, entrepreneurs, and researchers in the Boston metro area, particularly in Cambridge, the area surrounding the campus. Brokers are already seeing potential homebuyers backing out of deals, including one where the buyer lost a $10,000 deposit.
“It’s very unusual in my experience for someone to put down a $10,000 offer deposit and then back out,” Sage Jankowitz, a solo broker in Cambridge, told Realtor.com.
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Foreign Graduate Students Are An Essential Real Estate Component
Trump’s attempts to block Harvard from enrolling international students — currently blocked in a court action — also threaten to harm the rental economy, which relies heavily on housing for graduate students. “These people are mostly in their 30s or 40s,” says Jankowitz, who works with a broad cross-section of buyers and sellers, including investors. “A lot of them are married. A lot of them have one kid or multiple kids that come with them while they’re here.”
Boston’s housing market is one of the hottest in the country and not solely reliant on Harvard to thrive, but the loss of tenants and buyers could dampen the market in the Cambridge area, which immediately surrounds Harvard.
“It’s the densest concentration of academic talent in the world,” Lawrence S. Bacow, who served as president of Harvard University from 2018 to 2023 and as president of Tufts University from 2001 to 2011, told the New York Times. “Universities and teaching hospitals are to Boston what cars are to Detroit, what energy is to Houston, or finance is to New York.”
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University Affiliated Research And Biotech Have Helped Build Neighborhoods
University-related research is an integral part of the Boston metro area, where biotech companies have contributed to the development of flourishing neighborhoods, such as Kendall Square in Cambridge, home to the biotech company Biogen, and Boston’s Seaport District, where Vertex Pharmaceuticals is based, as reported by The Times. There is a concern that if academic researchers leave, the city’s economy, including housing, will suffer.
“Some will leave their science behind, and it will end — after a huge investment, it just falls off a cliff,” Dr. Wendy Chung, chief of pediatrics at Boston Children’s Hospital, told the Times. “The instability is very hard for people who are so hard-working and dedicated to their mission — they can only be pushed so far before they break.”
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‘Wealth Spiral Effect’
Evan Horowitz, executive director of Tufts University’s Center for State Policy Analysis, told the Wall Street Journal that if the Harvard funding freeze persists, the city could suffer a “wealth spiral effect,” with research, real estate, and retail all affected. “These aren’t distributed jobs—they’re concentrated, so we could see strong local effects,” he said.
Lauren Holleran, a vice president at Gibson Sotheby’s International Realty in Cambridge, has already noticed a difference with high-end clients who are holding off on buying and selling. “They’re saying, let’s see how things shake out,” she told the Journal.
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