HouseSavvy data compared the Greater Boston Market to the national market in several key areas:
· Sales Activity, year to year: national figures are down 5.8 %, Greater Boston up 7.25%; this is a 13% spread, and reflects a significant increase over even last month’s readings, which showed an increase of 5.25%
· Average Sale Price year-to-year nationally is down 14%, same as last month’s findings; Greater Boston down 5.6%, showing a spread of 19.9%
· Supply of Unsold Listings nationally is 9.4 months; Greater Boston 4.63 months, about 100% better than the national market.
National data availability lags local data by approximately 30 days, but does provide a reasonable indication of current trends that don’t normally change that much from month-to-month.
Plymouth County sees sharp uptick in sales activity
SALES ACTIVITY
For July, Greater Boston sales activity was up 7.25% year-to-year, from 2,965 to 3,180. This shows a large increase since January 2009 where monthly sales activity has increased 96.7%. Data reported last month had shown a year-to-year sales increase of 5.36%.
“This is much more than the historic seasonal increase, and an extremely positive sign,” said Hall. While most counties have seen a negligible slow down in month – to – month sales, Plymouth County is the exception, with a month – to – month sales increase of nearly 11% (steady 80% increase since January). Middlesex County and Essex County continue to lead the January to July increase at a rate of 115% and 102% respectively, followed by Norfolk (93%), Suffolk (83%), Bristol (77%). “Despite very small month – to – month slowdown in some of the counties (most likely due to summer months activity), the overall “big picture” is good and expected to continue that way,” said Hall.
AVERAGE SALE PRICE
The average sale price for closed sales (transfers of title) remain slightly down year-to-year, from $439,553 to $414,949, a 5.6% decline. The good news (Big Picture) is that regionally the average sale price has increased 18% since January. Most counties are down slightly month – to - month with the exception of Middlesex and Norfolk counties.
The veteran real estate analyst cautioned, “Most consumers and media believe that the reported average sale price of homes sold in a certain geographic area equates to the average value of all the homes in the same area. Although there is some correlation, the average sale price (of homes sold) should not be confused with the average home value (of homes not for sale). Average sale price simply indicates what buyers are paying for homes that are on the market for sale. Average Sale Price and Average Home Value will closely correlate during extended periods of consistent market conditions. Average Sale Price and Average Home Value will not closely correlate during periods of market volatility and/or transitions between positive and negative market conditions and vice versa. The current market conditions in the Greater Boston Market fall into this category, i.e. these averages do not closely correlate.
SUPPLY OF UNSOLD LISTINGS
The Supply of Unsold Listings is determined by dividing the number of unsold listings at the end of the month by the number of sales that occurred during the same month. Experienced real estate professionals have long believed that – given a stable market over a period of time - a six month supply of unsold listings indicates a “Balanced Market” with sellers and buyers about equal and home values holding steady. However, when real estate markets are volatile – either improving or declining in the short term as has been the case in the Greater Boston Market – a five month supply is a better indication of a Balanced Market. Although the number of Unsold Listings has increased the last four months, the strong increase in Sales Activity has more than compensated for this increase and, as a result, has driven down the Supply of Unsold Listings. The current 4.63 month supply of listings for the Greater Boston Market is great news for home sellers and indicates a strong Balanced Market continuing for the second straight month - trending toward a Moderate Sellers’ Market. Year-to-
Hall added, “It’s apparent that the Greater Boston Market “bottomed out” in January after nine straight months of sale declines and six months of declining average sale price. Since January 2009 sales have increased 96.7%.”
He continued, “Even factoring in historic seasonal activity this is a significant increase. It is important to keep in mind that Average Sale Prices for the Greater Boston Market have generally been ticking up, though the individual counties have seen month-to-month price fluctuations over the past with slight ups and downs.”
The HouseSavvy research team concluded, “We are optimistic that the current improvement will continue moving us in this very positive trend line. The Supply of Unsold Listings is trending toward a Moderate Sellers’ Market and is the lowest it’s been in over a year. Absent any national situation that severely dampens consumer confidence, it looks like the Greater Boston Market is definitely on the upswing.”
This most recent analysis is based on information compiled by the HouseSavvy Research Department, which compiles and analyzes local, regional and national real estate and mortgage data on a daily basis and reports it monthly on housesavvy.com in its Timely Market Info section. HouseSavvy documents and compares sales activity, average sales prices and supply of unsold listings in 12-month and three-month overviews.
HouseSavvy also publishes its proprietary “Market Snapshots” review, which each month spotlights two towns/cities within each county in the Greater Boston area, including Bristol, Essex, Middlesex, Norfolk, Plymouth and Suffolk counties.
