It's the last Monday of the official start of Fall - and like most things, the real estate market is moving to turn a new leaf. We'll fill you in on all the exciting things that happened this past weekend: from the Avenue of Arts being redesigned to the rise of Seaport Square and rental rates in that district and its [...]
Blog :: 09-2014
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As Fall season fully settles in, there's a lingering question on everybody's mind: how did the local real estate market perform during the last month of the summer season? Well, to answer this question plainly, Greater Boston did fairly better than expected as it picked up from a first half year that was so-so compared to last year's sudden boom and return from recession.
Generally if you look at the big picture and yearly totals, Greater Boston's performance for is still very positive. Month to month, there are some highs and lows - August being one of them - but these ups and downs are uncommon in a balanced market. Some analysts and (pessimistic) real estate pundits think that this is a sign of bad things to come, but in reality these are as normal leaves changing colors - it's just been so long since we've experienced and seen a balanced market that a lot of real estate practitioners are watching the numbers with much trepidation. The most important metrics to watch are the number of inventory and prices, as well as days on market and month's supply. That being said, let's get down and dirty with the numbers:
New listings in the Greater Boston region were down 3.9 percent for detached homes from 1,029 units a year ago to 989 units this year. Condominium units were also down 17.2 percent from 868 in 2013 to 719 this past month. Closed sales decreased 10.4 percent for detached homes, with 1,280 units closed this year compared to 1,429 in August 2013. It's also down by 16.3 percent for condominiums, with closed sales this year totaling to 1,069 compared to last year's 1,277 units.
The Median Sales Price was up 3.7 percent to $539,000 for single-family properties gaining $19,000 from last year. Condominium Median Sales Price was also up by 3.4 percent to $429,996, adding almost $14,000 from last year's figures. Months Supply of inventory increased 8.2 percent for single-family units but was down 11.4 percent for townhouse-condo units.
According to the Greater Boston Association of Realtors (GBAR), sustained job growth, lower mortgage rates, and a slow rise in the number of homes for sale appear to have unleashed at least some pent-up demand. Since housing demand relies heavily on an economy churning out good jobs, it's encouraging to see the nation's second quarter GDP growth revised upwards to health 4.2 percent. Additionally, stronger-than-expected job growth in recent months have painted a rosy outlook for the real estate industry, as more and more families and individuals seek to better enrich their lives - with property being on the Top 3 list of purchases a good majority of the population will make in the next three to five years, barring any significant increases in mortgage rates.
As a last note, you can easily observe that as common sense would dictate: that as the number of listings continue to decline, the higher the median sales prices will be. It's a good thing then, that Greater Boston's supply is sufficient, at least to satisfy the market's demands (read: no bubble in the works). Honestly, if you're on the fence on making a property purchase decision, we're projecting that the next year will be the best time to do it. Remember that as the economy continues to improve, the less likely you'll find choice properties as more and more people take them off of the market. So if you have resources to invest now, then we suggest you do so.
It seems that as the months and the temperature gradually changes to full Fall season mode, real estate developments are also on the move. Changes in trends, and more projects are coming up even as we exit the usually-higher summer real estate transaction months.
A concrete example is how the Boston Redevelopment Authority (BRA) has just approved a 16-story tower on the East Boston Waterfront. The project, to be undertaken by Gerdin Edlin, a Portland, Oregon-based developer, will transform an empty industrial building to a glimmering residential project, complete with a wharf, and and a clubhouse.
According to plans, the tower will have about 16 units per floor, giving it a 16x16 dimension to the project. In its entirety, the development could create about 259 housing units.
Gerdin Edlin, which entered the Boston market a few years ago, has developed luxury apartments in the Fort Point Channel area. More details of the project will be released in the coming weeks.
NEWTON IS NUMBER 1 CITY TO LIVE IN THE U.S.
In other news, two Massachusetts cities made it to the list of the Best U.S. cities to live in. The City of Newton is enjoying another day in the sun, as website Wall Street 24/7 just proclaimed it as the top-most desirable (that's right we're No.1!) city to live in the whole country! That will definitely contribute to Newton homes having an additional and healthier, albeit small bump to home prices.
The list also gives high marks to Boston's southern suburb, Quincy, which ranked 33rd overall.
Among other New England cities in the overall ranking, Warwick, R.I., ranked 45th, Cranston, R.I. ranked 36th and Nashua, N.H., ranked 32nd. Let's take a look at how the Massachusetts cities fared in individual categories:
- For economy, Newton ranked 46th and Quincy ranked 50th.
- For crime, Newton ranked 5th and Quincy ranked 11th.
- For education, Newton ranked 6th and Quincy ranked 38th.
- For housing, Newton ranked 1st and Quincy ranked 14th.
- For environment, which factored in air quality, average temperatures and average rainfall, Quincy ranked 4th and Newton ranked 8th.
- For leisure, Newton ranked 9th and Quincy ranked 18th.
- For infrastructure, Newton ranked 7th and Quincy ranked 20th.
Newton has been in the sun for its ultra-desirable living conditions. In fact, rent.com ranked Newton as the best city in the United States for couples just a week ago.
And speaking of other towns, let's take a tour of the towns with the hottest condo prices right now.
Plymouth, Lexington and Everett all have one thing in common: Double-digit increases in condo prices - more than 20%, in fact!
Plymouth seems to be the 1st placer in condo price this year, with a more than 50 percent increase through the end of July. Plymouth's median price is now over $358,000, with 100 condos sold so far this year.
Next up is Everett, which, after today's decision by the Massachusetts Gaming Commission to let Steve Wynn build a $1.6 billion casino in the city, could soon become Las Vegas East. The median condo price in the old industrial city on the Mystic River has jumped more than 34 percent, to $236,500.
Just 12 miles to the west is Lexington, one of Boston's most historic communities along with being one of its most affluent suburbs. The median condo price in Lexington is now $575,000, after a 32.6 percent increase.
Next up is Melrose, a middling suburb just north of Boston where the median condo price is now $290,000 after a 32.4 percent increase.
Now it's time to head back towards the city to Allston, one of Boston's most diverse and vibrant neighborhoods, as well as Boston's college-student capital. Allston's median condo price just hit $357,000 after a 28 percent increase so far in 2014.
So, if you're looking to buy brand new away from Downtown, these cities are certainly worth looking at. While Cambridge is still ideally close, it does have a higher median condo price of $566,500, and even Somerville falls within that, with a median price of $475,750.
A sleek new condo building certainly has its draws, from sensible layouts to high-end stainless steel appliances, pristine lobbies and fast, reliable multiple elevators. Of course, we know that those perks don't come cheap. Not only will you pay a premium to buy new, you'll also take a risk on the unknown and untested, especially if [...]
As we mentioned in our article last Monday, there seems to be an upsurge of developments and tweaks going on in the Downtown Crossing (and now Financial District) area in an attempt to "modernize" the neighborhood that's considered the Downtown junction of the city. Congress Square, a project commissioned by real estate developer Related [...]
Many things and trends happened over the summer: as expected rental and sale inventories dwindled, more developers announced landmark projects, and more importantly, the real estate market overall has regained its momentum of recovery. In all of this, one predominant thing that definitely changed over the last three months is [...]
Summer is not the only time that the real estate machine turns and churns. Though it might be the height of buying, selling, and renting, it is not the only season when properties get snapped up and or rented out. Though unconventional, some people tend to do transactions throughout the year precisely to avoid the rush, and hold off on any [...]
You might still be in pumpkin season denial given the deceivingly scorching weather outside, but sadly it's true: summer has come and gone and yesterday was first full official day of Fall season. However, not just because summer - the busiest season for the real estate market - is over doesn't mean there's nothing to look forward to, [...]