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Coronavirus has made the supply-and-demand imbalance in Boston-area housing market even worse

Home prices soared again in April, but far fewer were sold

Rick Nazarro of Colonial Manor Realty in Reading talked with potential buyers at a home for sale earlier this month.
Rick Nazarro of Colonial Manor Realty in Reading talked with potential buyers at a home for sale earlier this month.Blake Nissen for the Boston Globe

If you’re looking to sell a house, this spring has turned out to be a surprisingly good time to do so.

If you’re looking to buy one, well, good luck.

Home prices in the region surged in April, according to data out Wednesday from local real estate groups, while the number of sales and homes on the market both fell sharply. The numbers are the latest sign that the coronavirus crisis upended the normally busy spring market by prompting would-be sellers to stay put, but it has done far less to dampen demand from people who are looking to buy.

“The fundamentals of the housing market and our local economy remain strong, and that’s giving many buyers the confidence they need to enter the housing market," said Jason Gell, broker-owner of Boston’s Luxury Properties, who noted that interest rates remain low and, for people with cash, the roller-coaster stock market may seem risky in comparison to buying a house. “There is no shortage of factors driving demand.”

That demand drove the median price of a single-family home in Greater Boston up more than 7 percent to a record high for the month, or $665,000, according to the Greater Boston Association of Realtors. The median condominium price climbed 8.6 percent, to $598,224.

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But the number of sales — houses and condos combined — fell nearly 11 percent, according to GBAR data, and the inventory of listings on the market dove by nearly 30 percent. Pending sales — those under contract to close in May — have plunged by more than half.

The coronavirus crisis has exacerbated a long-running imbalance between supply and demand in the region’s housing market, real estate experts say, making it even harder for would-be buyers to compete.

Kurt Thompson, a broker at Keller Williams Realty North Central in Leominster and president of the Massachusetts Association of Realtors, said a client last weekend bid $20,000 above asking price on a house in Shirley, and is now competing with four other offers.

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“There are buyers out there right now who are very serious,” he said.

What’s more, Thompson noted, this client was planning to move from Cambridge, where he works, to a small town 30 miles outside the city. That highlights another trend real estate agents say they’re seeing: At the moment, space is king, and working from home means a long commute may not be such a hurdle for some people as it seemed a few months ago.

"I think this is an emerging trend,” Thompson said. “With telecommuting and traffic patterns, people are more willing to come out here and have a little more space between them and their neighbors.”

How long these trends will hold remains to be seen.

Thompson is among many real estate agents predicting a wave of pent-up supply will hit the market this summer, as sellers become more comfortable with life under COVID-19, and agents adopt new techniques to show houses in a socially distant manner.

That could ease supply constraints somewhat. And if job losses — so far concentrated among lower-wage industries — spread to higher-earning households that typically buy in Boston’s pricey housing market, demand could take a hit.

If both happen at the same time, Boston’s decade-long run-up in home prices could stall, or even start to reverse itself. Indeed, the National Association of Realtors is projecting that prices nationwide will fall later this year.

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But not here, or not yet, anyway. If anything, Thompson notes, the coronavirus crisis has only made Boston’s tight and pricey housing market even more desirable. At least for now.

“There’s still a lot of people who want to live here,” he said.


Tim Logan can be reached at timothy.logan@globe.com. Follow him on Twitter at @bytimlogan.