Author: Jon Goode

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Real Estate This Week. Two Words. Multiple offers!

The first full week of February. Still no snow! Still no inventory.

Once again the story around the table at our business meeting was the 92 condos on the market in the South End.  A 22% decrease from last year at the same time. As I have said before, historically inventory is usually at its lowest level in mid winter, but this is  a new low.  In the $400K price range in the South End there are 15 properties for sale, only  1.75 months supply!

Many of our under agreements were products of  multiple offers. Properties that are priced well are selling quickly. Properties that have been on the market for a while are getting a second looks and selling. This is the view from the street.

The real estate outlook is running parallel to the bigger economic picture.  There is some momentum to the market, but it needs inventory to  fuel a strong spring selling season. The general economic picture is looking a bit more positive too.  A few more months of decent employment numbers and we just might be on a roll.

So far this week  (it is Thursday) 6 under agreements have come in. Three in the South End, one in South Boston, one in Concord and one in the Leather District, with list prices from $459K to $1,285K.  Agents are busy with buyers and sellers, and with temps in the high 40’s and low 50’s this weekend, we should see some great activity. I will give you an update next week.

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general info

Best Bets For Snagging That Rare Apartment Rental Downtown

Briggs Johnson is one of my agent contributors to the blog. He specializes in rentals and sales in the downtown neighborhoods. He knows the rental market exceptionally well and gives the best advice and service. He is also a very smart and engaged sales agent and one of the most affable guys around. He will occasionally bestow his wise words upon us in my blog. The post below is a great primer on the rental market and a must read. Briggs can be reached at buyrentsellboston.com or at 617-997-2720

Last Week, I got an email from a mutual friend who was trying to help his brother find a rental in the Back Bay, Beacon Hill or the South End. He was looking at rentals up to 2k and although I focus on the higher end rental market, I told him I’d send him everything up to $2100 on MLS. There were a handful of listings (10) and I got a follow up message asking me to send listings under $1600. I did a seperate search of 1000-1600 and guess how many rentals came up in those neighborhoods……ONE!! As of Feb 4th, 2012, there is only 1 rental available to the real estate agents via MLS. Now, don’t get me wrong, this does not mean that there are no rentals out there in this range, but it is a big indicator that if you are looking to live downtown under $2000 this winter, you are going to have a very tough time. Here are some key points to consider if you are in the rental hunt right about now or over the next few months.

1. Season. Winter, in general, can be Slim Pickins! Most rentals do not come on until the Spring and Summer months and the reality is that  most landlords do not want to have a vacant apartment during the middle of the winter. Generally speaking, rents tend not to get top dollar in the winter and they have the potential to stay on the market vacant,  (but with inventory so low right now, prices can still be on the high side). Most rentals that tend to come on the market in the Winter are “lease breaks”, the occasional “tenant at will” and condo’s that decide to turn into rentals. One thing that is important (for any season), is that most apartments  become vacant when the tenant gives their proper notice. In Boston, the majority of leasses are 60 days notice and sometimes 90 days. If you are looking in February, then you should start in December. Yes, things do come up last minute, so its good to be aware, but know when its best to start your search.

2.Pets.  If you have a pet, it is going to be that much more difficult. I don’t have any statistics that confirm this, but i’d say about 75% of all Boston rentals are not pet friendly. No inventory, plus pets, means even more difficulty finding a place (or a decent place). You may have to pay more than you thought, or take something a little less nice,  just to find a place that will accept your pooch. If you have multiple pooches and a cat, your percentages have now been reduced even further. I remember getting a call from a desperate agent looking to help his client find a $1700 apartment for him and his 4 chihuahas. Really? I’d rather hunt for unicorns in the Blue Hills than take on that challenge. My tip for that type of renter is…well…buy a condo (if you can).

3. Open up your neighborhood search. If you won’t budge on quality and can’t find anything, open up your neighborhoods. If you start just looking at South End, Beacon Hill and Back Bay and see nothing….open it up to South Boston, Charlestown, Cambridge, Brookline etc….

4. Wait (if you can). If you have to move ASAP, then, you have to take something and bite the bullet. If you hate what is out there, I suggest only signing a lease till August 31st and start your search over again in the summer. There are few landlords that will be against this because it gets them “back on the cycle.” If you are currently in a place that has a flexible move out date than you have a better chance of finding something that better suits your taste. Things come up all the time, but really at random, so if you keep focused on whats out there you should have some luck.

5. Negotiation. If you are looking at a lease break, you usually won’t be able to negotiate on the price. You typically have to pay at least what the current tenant is paying because the owner has the current tenant in a contract and does not need to rent for less while he is currently in a contract for.  If you are looking at a vacant apartment and can occupy the place almost immediately, then you have the best chance to negotiate. If you are looking 2 months in advance, then you have less chance to get something for a lesser price because the landlord will most likely try to wait out for their asking price because time is on their side, not yours.

6. Paying a Fee. If you are a renter and are working with an agent, expect to pay a fee. I love getting calls from people and say they only want to see no fee rentals. If you want no fee rentals then  I suggest looking on craigslist or going straight to the management company. Most agencies will charge a fee, but i suggest at least trying to negotiate. Winter tends to be a little slow and its worth asking to see if the owner would at least split the fee. I reccommend all renters I work with, to at least try. It’s rare for owners in downtown Boston to pay the fee, but, slower months happen much more than summer months. Expect to pay a full fee in the summer months, because if you don’t, there is someone right behind you who will.

7. Doorman you ask? If you want a building with a doorman you should probably expect to increase your pricepoint. If you want a one bed in an elevator building with a gym, common roofdeck and a doorman, expect to pay at least $2300. anything under $2000 was about 2 years ago. You might be able to find something for less outside downtown Boston, but you’ll have to read about that on someone elses blog.   If you are looking ar a 2 bedroom in these buildings then you are looking at the $3500+ price range. If you are looking at even more luxurious building like One Back Bay,  the Ritz, 45 province, the Mandarin etc. your pricepoint has increased to a whole new level.

8. Be Flexible to view properties. I love getting the client who can only see places after 8:00PM because they work late and are 1 hour outside the city. It’s almost impossible to set up showings that late for a few reasons. 1, the other agent can’t do that late, 2, I can’t do that late ,3, the current tenant or owner won’t allow the place to be shown that late and 4, if its a leasing office, they usually close around 6pm. If that is all you can do, then know you will be even more limited and it will be frustrating for both your agent and for you. Also, if you can only see places on the weekends, that is where you will have the most competition and potentially miss out on the good ones. I notice that the people who are the most flexible, have the best results. If you can sneak out during lunchtime for the brand new listing that looks awesome, do it!!

Hope these hints help “manage your expectations” in regards to your rental hunt this winter. It’s tough, its competitive, and it’s not going to be easy. Good Luck!!

Cell 617 997 2720

www.buyrentsellboston.com

 

 

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Real Estate Week In Review

Its February and you wouldn’t know it. There is no snow! Even better than that, the market is interestingly active.

The South End office had 7 under agreements this week. Our under agreements ranged from a property listed at $277K to one listed at $1,599K. Two under agreements over a million, 3 between $500K and $1M, and 2 under $500K.  This excites me more than anything. There is activity in all price ranges, and from what I hear around the office there are very serious buyers out there in all these price ranges just waiting for some good inventory.

 

The talk remains about the lack of inventory in all downtown neighborhoods. Available inventory is at an all time low of 2.23 months in the South End, and in certain price bands there is even less. The lack of inventory and strong buyer activity is creating many multiple offer situations. This is not mentioned to gin up excitement by any means but in order to maintain this early and healthy level of activity we do need additional inventory.

Some agents are even wondering if that winter vacation is such a good idea, as there is so much going on! I say go! Engage your coverage options and take a break as this early activity is boding well for a decent and busy Spring.

We had a great “robust” office meeting talking about the need to focus on a business plan and the need to utilize all the resources available in order to execute the plan, and of course the lack of snow and inventory. We had a fun agent and friends networking night out at Game On in the Fenway on Groundhog Day. I saw a post on fb this morning saying that Puxatony Phil is not a meteorologist and what the hell does he know anyway? 6 more weeks of winter? Hope not!

That’s it from here.

 

 

 

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analytics

Provincetown Market Report

Bill Farmer will be a regular contributor to my blog posting about everything real estate in Provincetown. Bill has recently moved full time to Provincetown after dividing his time between Boston and Provincetown for the last several years. He has joined Bob O’Malley at Beachfront Realty. Bob is a real estate “institution” in Provincetown selling real estate at Beachfront Realty for the last 27 years.

 

Stable yet dynamic, with a wide range of opportunities. The 2011 Provincetown market report compares Cape Cod MLS sales data from 2010 to 2011 and shows all these characteristics.

The Provincetown market is relatively stable year over year.  The median sales price for condos in 2011 was the same as 2010, $360K. Unit sales were down only 8% from 124 condos in 2010 ($49M volume) to 113 condos in 2011 ($42.5M). The average sale price for condos was down 5% from $395K to $376K.

Great news is that sales of single family homes increased 27% from 21 sales in 2010 ($25M volume) to 31 sales in 2011 ($23.4M volume). Sales of multi-family homes increased 87% from 8 ($5.7M volume) to 15 ($10.5M volume) !  What can we read into these crazy percentage increases? That demand remains very strong for property in our little fishing village.

The diversity of inventory and the opportunity it represents is incredible. The lowest price condo sold was $91K and the highest price was $926K. The lowest price single family sold was $278K while the highest price was $2.9M. These figures represent opportunities for everyone. All these figures speak to stability, consistency, and strength in the real estate market in Provincetown.

Current inventory is solid with buying opportunities in every price range. There are 63 single family homes on the market priced from $222K to $5,995M. There are 124 condominiums on the market priced from $125K to $1.795M and there are 12 multi-family properties on the market priced from $549K to $2.285M. I will keep you posted regularly on sales of interest and when new inventory comes on the market.

Bill Farmer 617-823-2444/[email protected].

 

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Buyers Best Practices

Preparing to jump into the buyer pool in 2012? Below are Ilyce Glink’s tried and true steps. Ilyce is the home Equity Blogger from CBS Money Watch. Her advice is spot on. Steps 1-3 are just good financial practices. I think number 4 is the most important, and not because I am a realtor, but because the team you chose to surround yourself with to advise you in the biggest purchase of your life is paramount to a successful and profitable transaction.  Oy!..I could tell you stories about mismatched home buyer teams, and I probably will.

1. Pull a copy of your credit history and credit score. Mortgage lenders have become extremely conservative and restrictive in deciding which mortgages will get funded. Lenders will pull credit scores from each of the three credit reporting bureaus (Equifax, Experian and Trans-Union) and then use the middle score to determine your loans interest rate and terms. You need to know that information ahead of time. Go to AnnualCreditReport.com and receive a free copy of your credit history and then pay for your credit score (about $9). You can also go to each credit reporting bureau or MyFico.com and purchase a copy of your credit history and score, if you’ve already used up your freebies.

2. Practice good credit behavior. Lenders regard borrowers with credit scores above 780 as their best customers. Unless your credit score is above that level, you should work on eliminating any errors, and practicing good credit behavior so that your credit score rises. The best thing you can do? Pay your bills on time and in full each month. The next-best thing you can do is maintain four open and active lines of credit. Each credit reporting bureau offers good credit behavior tips for free on its website, or you can go to MyFico.com. (Full disclosure: I contribute real estate posts to the Equifax Finance Blog, where Equifax’s credit experts blog about credit trends and information.)

3. Shop around for the best loan. Even though the federal government is backing more than 90 percent of all the loans through Fannie Mae, Freddie Mac, FHA, VA and USDA, it pays to shop around. Make sure you talk to at least four or five lenders before you sign your application, including a “big box” lender, a small local lender, a credit union, a mortgage broker and an online lender. Use the information you glean from each lender to negotiate a great deal for yourself. Yes, you are allowed to negotiate with lenders and ask them to give you a better deal.

4. Create a great home buying team. Whether you’re buying investment property or a home to live in, you’ll want to create a team of real estate professionals who can help you find the right property, at the right price, on the right terms, without any headaches. The team should include a great real estate agent, mortgage lender, real estate attorney, tax preparer (with experience in investment real estate if you plan on buying real estate as an investment) and real estate inspector to start. Residential real estate investors will want to add a 1031 exchange professional and commercial inspector (if appropriate) to the mix.

Having the right team in place will go a long way toward making your dream of homeownership come true.

by Ilyce Glink, RE journalist, home equity blogger @ CBS Money Watch

 

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analytics general info

2012 Housing Outlook. Compare And Contrast

In its latest economic outlook, NAR released its forecast figures for 2012. In attempting to bring it all right back home to what it means to us, I will compare and contrast these national figures with those here at home.

I have used MLSPIN data including all Boston neighborhoods for this post. MLSPIN groups all Boston neighborhoods together from South Boston to Back Bay to Dorchester and the Waterfront. This  broad data representation compares more effectively with broad national and regional data, in other words apples to apples, vs a more micro comparison with core downtown neighborhoods, which I will do in future posts.

NAR projects that new-home sales fell 5.9 percent in 2011 to 303,000, but will rise 16.2 percent in 2012 to 352,000 and jump a whopping 53.4 percent in 2013 to 540,000. National new home sales figures have less to do with our local market in that they represent such a small portion of it, but national and regional new home sales figures do drive attitudes and consumer confidence in general.

Existing-home sales, which we will use as the figure better relating  to our marketplace, fell 3.7 percent in 2010 from 2009 to 4.18 million units, according to NAR’s rebenchmarked figures. In 2011, final sales figures are expected to rise 1.7 percent to 4.25 million. In 2012, NAR predicts sales will jump 4.7 percent to 4.45 million with a further 5.2 percent increase to 4.68 million in 2013. The total number of condominiums sold in Boston in 2011 was 3,519, a 5% decrease from 3,713 sold in 2010.  The consensus varies for unit sales increases projected for 2012 but an allover 5% increase in units while not a consensus figure seems realistic to me relative to NAR’s 4.7% projected increase.

This year’s median price for new-home sales was an estimated $222,800, a slight 0.8 percent rise from 2010. NAR expects the median will rise 1.9 percent to $227,000 in 2012 followed by a projected 3.3 percent increase to $234,500 in 2013.

NAR expects the median price for existing homes to drop 4.4 in 2011 to $165,200. Nevertheless, NAR predicts prices will subsequently rise 2 percent in 2012 to $168,500 and another 2 percent in 2013 to $171,800. Median price for condos sold in Boston in 2011 was $380,000, a 3% increase over $369,000 in 2010. The average sale price in Boston for condominiums in 2011 was $535,000 a 3% increase from $520,000 in 2010.

For the first time, NAR forecasts rent inflation, predicting rents have risen 2 percent from 2010 this year and will rise 3 percent and 3.5 percent, respectively, in 2012 and 2013. We will hear more on this from Briggs Johnson my rental contributor in future posts.

 

 

 

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analytics trends

Inventory Scarce in The New Year

The buzz this past week in the market and in the office was of the extremely low inventory level of property for sale and in turn how this is effecting buyer engagement in the New Year. In stark contrast though there was lots of  buyer activity this past weekend. Plenty of buyers were out at open houses, showings were plentiful for what inventory there is and from all reports buyers were excited and and motivated. The challenge for agents and buyers alike is to keep engaged in the process as we wait for the inventory level to increase.

 

MLSPIN shows 94 condos on the market for sale in the South End on January 13. Last year at this time there were 102. In comparison, there were 133 condos for sale in January 2010 and 134 condos for sale in January 2009  in the South End.

For context the historically highest level of inventory we have seen in the South End was 268 condos for sale in May 2009, the height of the Spring selling season, and the historically lowest level of inventory is now. Today’s inventory level is approximately 1/3rd the inventory of May 2009. Unbelievable!

What has created this low inventory level? In the last 30 days we saw 16 properties expire out of MLSPIN. 32 went under agreement and in the same 30 day period 35 sold. This sustained level of activity created a 46% decrease in inventory in the last 90 days! From 173 condos for sale in mid October to 94 today. Currently there is just 2.3 months supply of inventory in the South End with similar conditions in other neighborhoods. There is 4.6 months of available inventory in the Back Bay, 3.2 months in Beacon Hill, and 3.3 months in both Charlestown and South Boston. A normal market, at least nationally,  balanced between a buyers and sellers market, is when between 6-8 months supply of inventory for sale exists.

This low inventory can usually be explained by the regularly lower inventory levels that are seen at the beginning of the year, and that is surely part of the answer, but I think there is more to it. There are many sellers who just aren’t putting their properties on the market because they see a new normal for price appreciation. On the other hand for those sellers who can see the opportunity in this rather unique historical perfect storm with lack of inventory and high demand for reasonably priced properties, there has been no better time in the last several years then now to market a property for sale. There is less inventory thus less competition, and demand is exaggerated by this lack of inventory. Interest rates are at an all time low too!

I am not playing the role of realtor cheerleader here, I am just relaying the facts. Although I may be an optimist I am a pragmatic optimist. Facts are facts and they all point to a market situation which is just begging for inventory.  I will keep you posted week by week as we see how the Spring Market of 2012 evolves.  It is sure to be interesting.

 

 

 

 

 

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analytics

Pending Home Sales Jump

I love going into the New Year with all the positives we can get. A monthly index that tracks pending sales of U.S. existing homes rose to its highest level in 19 months in November, according to a report  released by the National Association of Realtors.  Pending sales figures are a very good indication of what consumer attitudes and confidence are going into the New Year as they directly correspond to buyers attitudes and confidence.

NAR’s Pending Home Sales Index, which is based on purchase contracts signed but not yet closed, jumped 7.3 percent from an upwardly revised 93.3 in October and 5.9 percent compared to November 2010, to 100.1. That’s the highest index score since April 2010, just before the deadline for a federal home-buyer tax credit program, when the index was at 111.5, NAR said. “Some of the increase in pending home sales appears to be from buyers recommitting after an initial contract ran into problems, often with the mortgage,” Yun said. “November is doing reasonably well in comparison with the past year. The sustained rise in contract activity suggests that closed existing-home sales, which are the important final economic impact figures, should continue to improve in the months ahead,” Yun added.

What we are seeing statewide through December bears these NAR figures out. A more recent Massachusetts Association of Realtors report shows that the number of condos put under agreement in December in Massachusetts was up 13% to 1,179 units vs 1,046 in December 2010.  The number of single family homes put under agreement in December was up 11.7% to 3,227 units vs 2,888 units in December 2010.  Pending sales in my Coldwell Banker Residential Brokerage South End office are up 20% December over December. As with the NAR and MAR figures these positive figures are a reliable sign of increased sales occurring in January and February.  Time will tell.

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analytics general info trends

Solid Year End For Downtown Boston

I love getting my hands on “hot off the presses” year-end sales results from MLSPIN, the real estate industry’s data platform.  I have written in prior posts that the South End and the $1M+ markets in particular have fared well in 2011.  Well, the good new continues as we look at initial year-end data.

Boston’s core downtown neighborhoods showed strength and resiliency in 2011.  As a group of neighborhoods including Back Bay, Midtown, South End, Bay Village, Beacon Hill, Charlestown, Fenway, Seaport, Waterfront and the North End, the median condo sales price in 2011 was $545K,  up 1% from 2010. The average condo sales price $769K, was down only 2% year over year. Total sales units were 1727 vs 1707 an increase of 1%.  This is an important number as most of the year we had been up against the inflated sales numbers caused by the tax credit through spring 2010. Total core downtown neighborhood sales volume was even with 2010 at $1,329M. (That’s One Billion and three hundred twenty-nine thousand dollars in condo sales.)

When you look at all of Boston neighborhood’s*, including the core downtown neighborhoods and others from Allston/Brighton, Chinatown, South Boston, Dorchester, Roslindale, to W. Roxbury, the average median sale price for condos was $380K which was up 3%. The average sales price was $535K, up 3%.

These preliminary figures reflect  a market that remains consistently strong, and resilient. We are extremely fortunate to be living in Boston, and experiencing a relatively strong market where opportunity exists whether you are buying or selling. Boston is a great place to be in 2012.

*MLSPIN groups all these neighborhoods under Boston when doing a general “Boston” search.

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analytics trends

Ft. Lauderdale Ranks #5 on Realtor.coms Top 10 Early Turnaround Report.

The post below is by Steve Roberge, my South Florida contributor writing about market conditions in Ft. Lauderdale. Interesting information, and counter to what you may think. Steve is a top producing agent with Coldwell Banker in Ft Lauderdale. He was with my office in Boston before moving to Florida and has been very active in real estate in Boston, Ft Lauderdale and Provincetown. Enjoy.  Steve will be a regular contributor to the blog. Steve can be reached at [email protected].

In addition to Fort Lauderdale, six other Florida markets (Miami, Orlando, Fort Myers/Cape Coral, Sarasota and Lakeland/Winter Haven) dominate the Top 10 list, based on 3rd quarter 2011 data. All of these markets have experienced significant reduction in inventory, median price appreciation and the length of time a property sits on market for sale. Also, Florida has a lower unemployment rate and the warm climate makes it an ideal location for vacation/second home. With a decline in the US dollar, Florida has seen a steady flow of foreign buyers taking advantage of both their currency purchase power and the depressed real estate market, scooping up properties at much lower prices.

The Fort Lauderdale Real Estate market inventory has reduced by as much as 38% and real estate prices are trending upward after falling as much as 50% since 2005. 

In summary, the real estate market seems to be in a recovery mode.  Buyers who are on the fence about buying or convinced prices will continue to fall, may want to reconsider.  Interest rates are at historic lows and now be the perfect time to jump in. Besides… the weather is great!!