Tag: Boston sales outlook

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analytics general info

Boston Up 1.4% From Low

The Standard & Poor’s Case-Shiller Index released this week shows that Boston real estate prices are up 1.4% from  our low in September 2005. Most parts of the country seemed to bottom out in the summer of 2009 and from there began a slow recovery. Many markets have now fallen below that 2009 “bottom” too, but not Boston.  The Case Shiller composite of cities index shows prices decreasing 1.8% since that composite “bottom” in 2009. Hmm…so that really wasn’t the bottom in many markets.

As we fortunate folks in Boston know, we fared much better than most. Atlanta has declined another 17.2% from its low in July 2007. Las Vegas has declined another 19.3% from its ow in August 2006. On the other end of the spectrum San Francisco has increased 8.7% since its low in in May 2006.

Here is some interesting context as we try to make sense of all this analysis and what it means  to us in our  specific neighborhoods. At 2005 year end, which was near Boston’s historic low, the average sales price for a condo in the South End was $527K. At year end 2011 the average sales price of a condo was $656K, an increase of 14.6%. At 2005 year end the average price of a Back Bay condo was $1,038K.  At year end in 2011 it was $1,045K, a .07% increase.

As you can imagine the 1.4% increase in prices from the low in Boston in 2005 represents an average of all neighborhoods.  This composite average price increase is a result of the incredible variety of prices, inventory type, location, condition, and of course supply dynamics in Boston, and drives home the huge variety of buying and selling opportunities that exists today.

 

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analytics general info

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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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.