Hi HippocratesX,
Housing in Boston is hard to find, it requires a lot of legwork, but it isn't the nightmare some people imagine ie it's not New York! One resource worth checking out is the Harvard Housing Office. You can use their facilities with a valid Harvard ID or letter of acceptance. They are located on Brattle Street in Harvard Square and have computers and paper listings of apartments available submitted by independent landlords and "room shares"/Room mate ads. It takes a lot of work. If you are more interested in finding a place without work then the only way is to hire an agency. Some of these drive you to the housing to show you. Only go with these agencies if you want one as without that assistance it's almost as easy to just do the leg work and find one yourself. Half the battle with Boston/Cambridge is that every sub-city (Cambridge, Somerville, Allston, etc) have EXACTLY the same street names, not interconnecting, and finding an address can be a nightmare - especially if they list it as "Cambridge" to make it sound desirable when it is infact in Somerville....
As to areas, it really depends on your work habits. When I was in Boston I liked to be able to work late. As on-campus parking is impossible to get and costs the earth, and non-campus parking is just plain impossible you have two choices - live within walking/biking distance, or live on the transit system somewhere. If you live on the red line (eg Davis Square, or further out) housing is cheaper than living right beside Harvard but you are limited to getting to and from campus by the hours of the transit system which can be a pain at night (as Boston shuts down, unlike more civilized cities...
) and because in winter standing around in the cold bites ass. If you want to live within walking distance of Campus but NOT pay an arm and a leg look north of campus, across the Cambridge city limits into the city of Somerville (literally 5 minutes and up walk away). Somerville is a more blue collar area and rents are lower. I shared a house with 4 other students there and we paid $350/month plus utilities. I also lived 2 minutes closer into Cambridge and payed $700/month which itself was a good deal for Cambridge.....some people refer to this area as "slum-erville" rather than Somerville. Yep, it's not as swish as Cambridge but I never felt in danger there...it's just lower income, and as I had no income that suited me!
If you want lower rent but closer in you can always live in Allston but then you are again reliant on public transport or at least a longer bike ride (not really walkable, but bikeable in some weather). Allston is more middle income but personally I thought it was a pain to travel to and from. It remains popular with Business school people etc though as it's closer to their classes.
Good luck.
