Are you planning on buying or selling a home in Massachusetts? It will help to know everything you can about the Massachusetts property market. Fortunately, there is plenty of good news to share as the northeastern part of the country is finally recovering from the 2008 recession. However, inventory is tight and prices are increasing, making it a seller’s market.
If you plan on investing in property in Massachusetts, here are a few important things to know about the current housing market.
With increasing prices and low inventory, Massachusetts is a seller’s market.
Currently, Massachusetts is a seller’s market. Prices have increased significantly over the past five years. Between 2014-2016, median home prices increased modestly at 2.5%, 2.9% and 1.5%. In 2013, median home prices jumped 11%, and last year, they climbed another 5.5%. Compared to where home prices were a handful of years ago, it’s safe to say that the market is doing well.
Unfortunately, housing inventory is on the low side, which is hurting overall sales numbers. It’s not clear why inventory is shrinking, but there are a few theories.
- Affluent homeowners are choosing to stay in their homes and fix them up.
- A lack of land in many parts of the state make it difficult to put up new subdivisions.
- People are afraid to put their homes up for sale because they may not find anything due to low inventory.
Bidding wars are common. Buyers are trimming down their lists of expectations.
Any time there is tight inventory, bidding wars are more likely to take place. There may be several prospective buyers for each home, forcing all of them to put in their highest bid. Buyers are prepared for being caught in a bidding war, but what’s interesting is that many admit that they’ve had to trim up their lists of “wants.”
For buyers, it can be frustrating not to find their ultimate dream home, unless they are willing to outbid everyone else. This is why some are choosing to stay in their homes and fix them up. Sellers, on the other hand, should be smart about making updates. If properties are being sold in less than 24 hours, sellers can do the basic staging and leave the big stuff to the new owners.
Somerville and Cambridge are expected to be hot.
Some real estate professionals predict that Somerville could be the next South Boston thanks to the Green Line extension and new developments to Union Square. Plus, high-tech companies continue to push into these areas to have access to graduates from Harvard, MIT, Tufts and others. There is surely no shortage of top talent.
Currently, Cambridge is less expensive than Boston, though not far behind. Condos sell for around $900 to $1,000 per square foot, whereas Somerville condos sell for around $800 per square foot. Arlington is another up-and-coming city because of its good schools, decent-sized homes and close proximity to the city.
The Massachusetts property market has some neat things going on, especially as new growth builds up in desirable areas around Boston. Only will time will tell if inventory improves. If you do happen to have property in Massachusetts, it’s safe to say you probably won’t have any trouble selling it.