Month: November 2008

Newton Real Estate Performs Better than Most Towns


Mass. home sales rise, but prices fall

November 25, 2008 08:05 AM Email| Comments (2)| Text size +

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(File photo: Mark Humphrey/AP)

The median sales price for a single-family home fell 13.9 percent to $285,000 in October, one month after falling below $300,000 for the first time in five years, the Warren Group reported today.

One bright spot: The number of homes sold in October rose nearly 14 percent from October 2007, said the Warren Group, a Boston real estate date firm.

The median selling price for a Massachusetts single family home was $285,000 in October, compared with $331,000 in October 2007 and $287,500 in September 2008. Last month, 3,698 single family homes were sold in Massachusetts versus 3,253 in October 2007, the Warren Group said.

The median selling price for a Massachusetts condo was $260,000 in October, down 5.5 percent from a year ago, said the Warren Group, which added that 1,660 condos sold in the Bay State last month, down 7.4 percent from 1,792 sold in October 2007.

Referring to the year-to-year increase in the number of single family homes sold in October, Timothy Warren chief executive of the Warren Group, said in a statement: “The uptick in home sales for two straight months is a hopeful sign. But the light at the end of the tunnel is still a long way off. What we saw in the early 1990s during the last housing downturn in Massachusetts was that the number of sales increased for at least eight months while prices continued to decline. The lower prices are a key factor driving sales volume up. My expectation would be that the number of home sales will have to climb for several more months before price declines start to level off. Another factor to keep in mind is the impact of the collapse in the stock market. Our October data reflects sales that were negotiated over the summer and closed in October. Our data cannot tell us if people were still shopping for homes in October.”

A separate housing report from the Massachusetts Association of Realtors was also released this morning. The Warren Group and the Massachusetts Association of Realtors use different methods to track local housing activity.

Falling prices lifted October home sales in the Bay State, the Massachusetts Association of Realtors said in its monthly report on the local housing market.

Last month, the median selling price of a single family home in the state was $294,950; that was 10.6 percent below the median price of $330,000 in October 2007 and roughly flat with the median in September 2008, the association said.

The number of single-family Massachusetts homes sold in October rose 6.6 percent to 3,250 from 3,049 in October 2007, the association said.

As for Massachusetts condominiums, the October median price was $250,000, down 10.7 percent from $279,950 in October 2007 and down 2 percent from $255,000 in September 2008, the association said.

Last month, 1,296 condos were sold in the state, down 1 percent from 1,309 condos sold in October 2007, the association said.

“As was the case in September, buyers took advantage of more affordable prices in October, which continued to drive activity,” Susan M. Renfrew, president of the Massachusetts Association of Realtors, said in a statement. “An increase in sales in each of the past two months is definitely something to feel good about, but we still need to see how sales are in November to determine if this is a trend.”

To read a story in today’s Globe about housing sales in the Northeast, please click

Toll Increase Negative Impact on Newton


Many of us are concerned about the proposed toll hike on The Mass Pike, and the increased traffic cities and towns surounding the Pike will endure.  I am provining a link to a STOP THE PIKE  HIKE site.  Let the State House hear us and vote no.  Route 9, Comm Ave, and Wahington Street will be overrun with traffic especially at rush hour.  Lets see, pay more to travel the Pike and our consolation prize is more traffic?  Seems like the lawmakers don’t live in the western suburbs.

http://www.stopthepikehike.org/

Boston.com/Newton


Boston.com has rolled out its everything Newton website.  Very cool, quick way to find out almost everything you want to know about what is happening in Newton.

BOSTON.COM/NEWTON

Newton/Brookline Real Estate- What do the numbers mean?


The Greater Boston Real Estate Board issued their real estate rewind this week. The piece reported on number of sales, median price, under agreements, days on the market, as a comparison of 3rd quarter 07 vs. 3rd quarter of 08.

NEWTON
2007/ 2008
213 SF Homes/ 168 Single Family Homes
$850K Median Price/ $817K Median Price
$978K Average Price/ $998K Average Price
94 Days on the Market/ 95 days on the market

Volume is down 21.5% Median Price down 3.8% Days on market up 1 day

BROOKLINE
2007/ 2008
62 Single Family Homes/ 35 Single Family Homes
$1735K Median Price / $972K Median Price
$1,435K Average price/ $1,400K Average Price
91 days on market/ 93 days on the market

Volume is down 43.5% Median Price is down 32.3%* Days on the market is up 2 days
The most important thing to look at regarding the Brookline numbers is very simple. In August of 07 a house sold for $14 million dollars, that one sale altered the true the numbers for 07 not 08. It is true that fewer higher end homes (over 1.5) went under agreemnt in the 3rd quarter of 08, bringing down the median price, but the reality is, the market in Brookline and Newton has remained relatively strong. At this point, it is clear buyers are on the sidelines, volume is down in both towns 21.1% in Newton and 43.5% in Brookline. Both towns have a fairly sizable population employed in the financial services industry. Many buyers are sitting on the sidelines waiting for the bottom; of course, no one knows where the bottom is, until the market is on the way up. My question is, if todays’ buyers had bought last year and their home dropped 5% in value, what percentage did they lose in the stock market waiting for the bottom of the real estate market? I bet more than 5%. Real Estate is a much safer investment, the bottom fell out of the real estate market in many other areas because of loans people could not afford. Thankfully, Metro Boston has had few foreclosures. Let’s hope the finance people can still afford their homes.

High End Inventory Rising in Newton


There are 65 single family homes in Newton priced above 1 million dollars, equivalent to a whopping 45% of the total 144 homes for sale. 36 homes are priced between 1 million and 1.5 million, 13 priced between 1.5 and 2 million, 10 priced between 2 and 3 million and 6 are above 3 million. In the past 4 weeks only 8 homes have gone under agreement, that equals about 12.5% of the inventory. The highest priced home that has gone under agreement in that time frame is 1.649 million. Some of the listed homes have had offers and a few higher than where they are listed now. Since a house is only worth what someone is willing to pay for it, sellers should try to work with every offer that comes to the table. If inventory continues to rise, homes are worth more today than they will be in 6 months. Zillow just released a newsletter stating that home prices have declined 2.35% in Newton during the 3rd quarter of ’08 compared to ’07. Bear in mind that the closings had to take place before September 30th. The impact the financial debacle had on the real estate market will not be known before January ’09. What is clear; the number of homes going under agreement is down as much as 55%. I would advise existing and potential sellers to evaluate their reason and motivation for a home sale. If you are not ready, willing and able to pass papers for any any reason, do not list your home for sale. Resistant sellers can unwittingly prevent the market from falling to its natural level, therefore, prolonging a declining market or push the market to lower levels because inventory sits unsold. Buyers are looking for value more than ever!

Reinstating toll at Exit 16 in Newton


Just to make sure the western suburbs pay for the Big Dig, Govenor Patrick is proposing the dismantling of Mass Turnpike Authority and placing roads east of 128 in the hands of Massport. In addition to this, all toll west of 128 would be removed with the exception of the toll plaza at Stockbridge which connects I 84 with Connecticut and I 90 with New York State. Well that seems fair doesn’t it? You can drive 50+ miles for free, but if you drive from Newton to Copley (about 5 miles) you will pass 2 toll booths. The biggest benefactors of the Big Dig are the North and South shore and yet they don’t pay any tolls on 93. Massport now runs the airport and seaport so you can see how that experience translates into assuming the role of the Turnpike Authority, which is already 2.2 billion dollars in debt.  How does running Logan and the Seaport qualify you to manage the Mass Turnpike? Where is the money coming from? If Patick wants Massport to assume responsibility for the Mass Pike (and keep it as a toll road) than they should also assume responsibility of all Mass highways. A toll booth at Exit 16 will increase pollution, traffic, and have a negative impact on the City of Newton. Tolls do put the burden on the people who use the highways, however, let’s eliminate all manned booths, build “open road tolls” as they already have in other states, and require a transponder. Since transponders clearly eliminate traffic back ups they should be free. Transponders save time, eliminate unnecessary employees, and reduce pollution caused by idling cars. The towns inside 128 should not bear the burden of all the highways in Mass. Why is driving the Mass Pike different than driving 495 or 128? What added benefits are we getting? All vehicle drivers should pay their fair share, Pike drivers also pay a gas and income tax that is used to maintain all of Mass highways, so why the extra fee assessed to them by way of tolls? Why don’t other drivers contribute to the Pike, since Pike drivers contribute to other roads? Let’s have one highway authority that has control of all Mass roads and distribute the burden evenly.

Mortgage Rates


Why are mortgage rates so high when the Fed Funds Rate is at 1%? It is partly greed, banks got burned by bad loans and are now charging a steep price to pay for the their mistakes. Simple answer would be supply and demand. The fewer investors willing to buy MBS (mortgage backed securities) the higher the rate of return. In times such as these, when investors are worried about people paying off the mortgages underlying the MBS, the reward is greater, hence, the 30 year conventional mortgage rate is around 6 1/4% and the jumbo rate is around 7. Translate that to real estate- lower rates allow buyers to buy more expensive houses. So will lower rates push buyers to the table?