Here's November 2014s Monthly Indicators report from the Greater Boston Association of Realtors
Boston Real Estate Market Trends
Strong buyer activity and low interest rates have pushed prices up on the homes that did close in November. While overall inventory of homes for sale is down statewide, there continues to be pockets across the state that are seeing increases. As the holiday season got under way in November, the number of new listings added to the market went down.
- November single-family home sales Down 6.7% over last year
- November Single-family median prices were UP 4.4% at $330,000
- November condo sales Down 10.2% and median prices UP 1.0% ($302,000)
- Inventory in November Down 13.2% to 19,068 and Condominiums Down 23.9% to 4,588
- SF listings added to the market in October Down 9.7% over last year (3,575 from 3,958 in 2013)
- Condo listings added to the market Down 3.3% over last year (1,343 from 1,389 in 2013)
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The Single-Family Home Market:
- Sales of detached single-family homes declined on an annual basis for an eleventh consecutive month in November, falling 4.3 percent from 792 sales in November 2013 to 758 sales this November. A steady drop in inventory, higher home prices, and slower job growth along with modest income gains over the past year have all led to a softening in buyer demand. The last time home sales fell for 11 consecutive months was October 2007 August 2008.
On a month-to-month basis, sales decreased even more substantially, declining 8.8 percent from an upwardly revised 831 homes sold in October. However, this decline was not unexpected as sales typically peak during the summer months and then slowly moderate each month until the end of the year due to the seasonality of the local housing market.
- The monthly median selling price for single-family homes rose 9.4 percent on an annual basis in November, increasing from a median price of $480,000 last October to $525,000 in October 2014. Its the largest percentage increase in the median home price since April when the median selling price also rose 9.4 percent from one year earlier. Additionally, its the tenth time this year, and twenty-fifth time in the past 26 months (dating back to September 2012) that the median home selling price has increased on an annual basis.
Notably, last months median home price of $525,000 is the highest ever recorded during the month of November in Greater Boston, and reflects a 5 percent gain on a month-to-month basis from a downwardly revised median price of $500,000 in October. Thats unusual given the slowdown in market activity, but is indicative of todays strong sellers market and the limited supply of homes for sale, as well as a jump in sales of high-end home sales over the past 12 months. Accordingly, November marks the twenty-first consecutive month in which the ratio of original list price to sales price received by sellers has stood at or above 95 percent. In addition, sales of homes priced at or above $1 million rose sharply by 36 percent this past year, from 97 last November to 132 in November 2014.
Currently, the November median selling price of $525,000 is up a full 50% from March 2009, when home values bottomed out at $350,000 during the recession.
- After declining for 28 consecutive months from March 2012 June 2014, the average market time for homes sold has now increased for five consecutive months in Greater Boston. Single-family homes sold in November 2014 were on the market an average of 70 days, compared to 65 days in November 2013. Market time also increased on a month-to-month basis, climbing from an average of 66 days on the market in October 2014. This reflects the largest amount of time its taken for homes to sell since April 2014 when the typical home was listed on the market for an average of 81 days.
- Pending home sales increased on an annual basis for a third consecutive month in November, climbing 15.3 percent from the same month last year to 799 homes put under contract. Its the largest percentage increase in pending sales activity in over a year, dating back to October 2013 when the number of homes placed under agreement improved 18 percent from the comparable month one year earlier. Meanwhile, on a month-to-month basis, pending homes slid 19.4 percent from a downwardly revised 991 homes placed under contract in October.
- After four consecutive months of modest annual declines of 1-3 percent in the number of single-family homes listed for sale, the inventory of homes on the market dropped nearly 9 percent in November from the same month last year and has fallen by nearly a quarter (24.2%) over the past 24 months. Its the thirty-seventh time in the past 38 month the number of homes listed for sale has dropped from the same month one year earlier, and with 2,265 listings on the market as of Novemer 30 the supply of homs for sale entering December is at its lowest level in more than a decade.
On a month-to-month basis, the supply level fell even more sharply, with the number listings tumbling 24.3 percent from an upwardly revised 2,991 homes on the market at the end of October. This is due in large part to the fact the number of new listings coming on the market decreased more than 50 percent in November from the prior month, declining from 1,270 new homes put up for sale in October to just 613 homes listed for sale in November which is lowest total since December 2013 when fewer than 400 homes came on the market.
Meanwhile, the inventory of homes for sale as expressed in months of supply slipped to 3.0 months of supply this November from 3.1 months of supply in November 2013 and 3.6 months of supply in October 2014. A balanced market occurs when 7.5 8.5 months of supply exists, so at the current sales pace there is woefully insufficient supply of homes available to meet buyer demand.
The Condominium Market:
- After experiencing a modest 4.6 percent annual increase in condo sales during October, activity in the condominium market decreased in November for the sixth time in the past seven months as sales fell 15.3 percent from 711 homes closed last November to 602 in November 2014. Sales declined even more sharply on a month-to-month, sliding 25.5 percent from an upwardly revised 808 condos sold in October. Despite the slower sales pace, the overall volume of units sold remained historically strong, as the 602 condo units closed last month is the eighth highest on record for the month of November in Greater Boston.
Demand for condos remains especially strong among suburban empty-nesters looking to relocate to Boston, as well as renters looking to become first-time homeowners.
- The median selling price for condominiums increased 6.1 percent on an annual basis from a median price of $410,500 last November to a new record high for the month of $435,500 in November 2014. Its the twentieth time in the last 21 months the monthly median price has risen from the same month one year earlier. The one aberration during this period was this past October when the median price dipped a modest 1.3 percent from the comparable month one year ago due to a higher concentration of high-end properties having been sold in October 2013 as compared to October 2014.
On a month-to-month basis, the median selling price also rose steadily, appreciating 5.9 percent from a downwardly revised $411,250 in October. Since the monthly median price bottomed out at $270,000 in January 2009 during the last market correction, the median condo selling price has now risen 61 percent to its current figure of $435,500.
Like the single-family home market, the condominium market continues to suffer from a lack of listings to meet current buyer demand, especially at the entry-level end of the market. As a result, sellers are profiting. In fact, the percentage of original list price to selling price reached or exceeded 98 percent for a tenth consecutive month in November, meaning the typical condo owner was able to sell their unit either at or just below the full original asking price.
- The average time for condominiums to sell increased on an annual basis for a sixth consecutive month, increasing modestly by 3 days over the past 12 months to 54 days on the market in November 2014. A similar increase in market time also occurred on a month-to-month basis as the typical condo sold in an average of 51 days in October. Notably, its the most market time, on average, for condominiums to sell in seven months, dating back to this past April when the typical condo sold was listed for 57 days.
- The number of condominiums placed under agreement rose modestly on an annual basis, increasing 6.4 percent from 627 units placed under contract in November 2013 to 667 units this past November. Notably, its just the fourth time this year pending sales have improved on an annual basis. Meanwhile, on a month-to-month basis, pending sales decreased 15 percent from a downwardly revised 785 units put under contract in October, and are at their lowest level since last January when 596 condos wen under agreement.
- The number of condos on the market declined for a fortieth (40) consecutive month in November, declining 25.4 percent over the past 12 months to 1,215 condos for sale, and by more than one-third (39.5%) since November 2012. Like the single-family market, the current inventory of condos for sale is the lowest monthly listing total in more than a decade, and has remained persistently below 2,000 units for sale for 20 of the past 23 months. Unfortunately, it appears as though the situation is not going to improve any time soon, especially with the number of new listings declining 44 percent between October and November to just 563 condos put up for sale in November, which is the fewest for a single month since December 2013 when 362 new condo listings came on the market.
At the current sales pace there is just a 2.0 month supply of condos available for sale, which continues a steady decline from year ago levels when there was a 2.3 month supply in November 2013. As a result, its clear that the ongoing shortage of listings continues to put upward pressure on prices and is preventing an even healthier rebound in sales activity from occurring, especially in suburban communities where few new units are being built.