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The Boston Globe

Business

Mass. home sales rise 35%, condos up 50%

May data suggest real estate market is finally recovering

The number of home sales in Massachusetts accelerated last month as more buyers took advantage of low interest rates and discounted prices.

Sales of single-family homes increased by nearly 35 percent in May, compared with the same period last year, marking the highest total in one month since June 2010, according to Warren Group, a Boston company that tracks local real estate.

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Condominium sales fared even better, increasing by more than 50 percent in May, compared with the same month in 2011.

“We continue to make solid progress toward a real estate market recovery,” said Trisha McCarthy, a broker at Keller Williams Realty in Newburyport and president of the Massachusetts Association of Realtors.

But having more sales is not translating into higher prices for single-family homes, Warren Group found. The median price fell to $289,950 last month, about 3 percent off from May 2011.

Median prices for condominiums, however, rose to $290,000, nearly 1 percent higher than during the same period last year.

Cory S. Hopkins, editorial director of Warren Group, said it is unusual for median prices for condominiums to exceed those for single-family homes. He attributed it to the fact that more lower-priced houses are selling, partly because increased foreclosure activity is depressing overall prices for single-family homes.

“The spring market has been especially strong,’’ Hopkins said, adding that he expects sales volumes to remain robust during the summer.

The Greater Boston Association of Realtors, which also released data on Tuesday, had a slightly different take on the May real estate market. It reported that the median single-family home price in the metropolitan area rose slightly to $465,000 last month, a 1.3 percent increase, compared with the same month last year.

The median condominium price increased to $381,000, 4.4 percent higher than last May.

John Dulczewski, executive director of the group, said he is encouraged by the increased activity because it is not being pushed by a federal stimulus program such as the 2010 home buyers tax credit. The challenge, he said, is that there are not enough houses on the market in Massachusetts.

“There are still pockets of sellers that are waiting until prices recover more fully,’’ Dulczewski said.

According to the Massachusetts Association of Realtors, the inventory of single-family homes for sale statewide decreased 13.7 percent in May, compared with last year, something that has happened in eight of the last nine months.

Nationwide, home values increased 1.3 percent in April, compared with March, according to the S&P/Case-Shiller Home Price Indices. The measure is considered one of the best indicators of home values because it is based on repeat sales rather than median prices. The news prompted cautious optimism among housing specialists, following seven consecutive months of dropping home values.

“With April 2012 data, we finally saw some rising home prices,’’ said David M. Blitzer, chairman of the index committee at S&P indices. “It has been a long time since we enjoyed such broad-based gains.”

Brian Bethune, an economics professor at Gordon College in Wenham, said a mounting number of positive indicators show the housing market in Boston and across the United States is probably on an upswing, but it will take time to gain momentum.

“The housing market bottomed and we have been climbing out very slowly,’’ he said.

Jenifer B. McKim can be reached at jmckim@globe.com. Follow her on twitter @jbmckim.
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