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‘It was kind of a smack in the face’: Millennials find search for starter homes even more competitive in the COVID era

Dan Burger, his wife, Randi, and daughter, Charlie moved from Malden into a Peabody home last month.
Dan Burger, his wife, Randi, and daughter, Charlie moved from Malden into a Peabody home last month.Suzanne Kreiter/Globe staff

They’d lived in Malden for eight years, renting a two-bedroom apartment close to the T. But with a toddler, zero outdoor space, and a pandemic turning things upside down, Dan Burger, 33, and his wife, Randi, didn’t want to wait any longer. They wanted to buy a house.

The search, and the prices they encountered, staggered the young couple. Plans to stay in Malden evaporated. The most “affordable” properties there fell into the $500,000 to $550,000 range, and most needed a ton of work.

“They’re like teardowns,” Burger said. “Literally no floors, no walls, just studs, and it was like $500,000.” Reluctantly, they increased how much they were willing to spend to the mid-600s and began looking in towns farther away. They landed a three-bedroom in Peabody, near the top of their budget. At that price “it’s not exactly a starter home,” he said, but with a big yard and a lovely view of the treetops, “we got really lucky.”

Luck is a relative term in the Boston housing market these days, where stiff demand and tight supply has forced prices up in many communities, even as seismic stresses continue to rattle the economy. House hunting tends to slow in the fall, but real estate agents say this year they don’t see that happening. After a spring short-circuited by COVID, buyers flooded back this summer with the median price for a single-family home in July shooting up 8.4 percent to $475,000 in Massachusetts. Many are desperate for more space and a yard after months of working from home, often with kids bouncing off the walls.

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“It’s a bizarre time, and I don’t know when it’ll end,” said realtor Melvin Vieira Jr., head of The Vieira Group of RE/MAX Destiny in Jamaica Plain.

Vieira calls the situation a “log jam.” As the pandemic drags on, baby boomers are staying put in homes they’ve owned for years, and a majority of young adults ages 18 to 29 — 52 percent, according to the Pew Research Center — are living with their parents as the job picture remains precarious. Meanwhile, millennials who might have looked at condos a year ago now want to avoid high-density housing. Those who can afford it are competing fiercely for the relatively few single-family homes available and prices reflect that.

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“A lot of increased demand we’re seeing is from city dwellers needing more space,” said real estate agent Mary Beth Grant of Coldwell Banker Realty in Milton. In addition to a yard, she said, buyers want a place where they can work remotely, or a guest room so family members can stay with them.

The intense demand can rocket prices out of reach for many shoppers. Grant mentioned a renovated home in Milton that had just gone on the market: three bedrooms, 1 1/2 baths, just over 1,700 square feet. The house last sold in 2013 for $455,000; seven years later, it’s priced at $779,000.

Priced out of some markets, buyers are poring over listings farther away from the city. And why not? With many offices closed for the foreseeable future, proximity to Boston is less of a priority for buyers who can work from home.

Milicent Armstrong and her husband long considered moving to the North Shore, but the thought of an arduous commute kept them in Jamaica Plain. Then COVID happened — and so did a house in Marblehead.

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“We felt like it was the perfect storm,” said Armstrong, who has a toddler and runs her shoe design business from home. “We didn’t want to miss the opportunity.”

Her husband, who works in finance, has been working remotely for months and for now the company has no plans to return to the office. “They all realized they could be just as productive” from home, Armstrong said. As for selling their house in Jamaica Plain: It went on the market on a Thursday, and by Sunday they had four offers, one with great terms and over the asking price.

Let’s stipulate that a great many people could never imagine spending the kind of money the market requires right now. A whole swath of the population is struggling to pay the rent or mortgage they have. But supply and demand — in the midst of a worldwide health crisis, no less — can exert astounding pressure on prices and what people are willing to spend to buy in.


Communities in the Central Middlesex region, which includes Lexington, Acton, and Sudbury, saw the median single-family home price climb 12.1 percent from July 2019 to July 2020, according to data from the Greater Boston Real Estate Board. Southern Norfolk, which stretches from Wrentham to Canton, also had a sizable jump, up 8.1 percent over that period. Other areas saw smaller increases. Metro Boston, which includes communities as disparate as Somerville, Newton, and Revere, was up just 2.6 percent year over year, while the median price in Metro West, from Needham to Hopkinton, was essentially flat during that time.

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Interest rates at near-historic lows continue to fuel the surge in home buying. Last week, the 30-year fixed-rate mortgage average fell to just 2.86 percent, a record low. A year ago, in September 2019, it hovered around 3.7 percent, which itself was down about 1 percentage point from the year before.

“Without low interest rates, we wouldn’t even be having this conversation,” said 27-year-old Mark Manolakis, who closed on a house in East Longmeadow at the end of August. He’d been living in Western Mass. with his parents, while his girlfriend, Nicole Dragone, also 27, had been living in Framingham with hers.

With some money saved, they looked in Framingham, as well as Waltham and Marlborough. But price tags around $600,000 scared them away, and they began to look farther west.

“The price differences were outrageous,” Manolakis said. Still, postpandemic, houses in more rural communities are getting snapped up quickly, too. When they found the house they wanted, they had to move lightning fast, as seven or eight other couples were also eyeing it. The house went on the market on a Tuesday, and the couple found out their bid was accepted Thursday at 4 p.m. They spent about half what would have closer to Boston.

“It’s a much more relaxed vibe out here,” he said of their three-bedroom home, which sits on a half-acre. “We’re so grateful we’ve been able to do something like this.”

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Of course, even the most conservative homebuyers aren’t immune to the uncertain economic landscape. Many purchase and sales agreements now include a COVID clause in case of unanticipated delays in closings due to a party being sick or quarantined, or even not being able to find movers due to a shutdown, said Noel Di Carlo, a real estate lawyer with Warshaw Di Carlo & Associates. Employment verifications have also become more stringent.

“It’s not only to see if they’re still employed, it’s finding out if there’s been any change to their salary,” she said, or if a company might be preparing for furloughs.

Software consultant Lauren Bahn, 29, and her boyfriend began looking in Stoneham, Wakefield, and Reading and were stunned at what they saw in the $500,000 to $600,000 range. Inventory was negligible. Yards were tiny. A two-car garage was a pipe dream. “It was kind of a smack in the face,” she said.

They upped their price point and began looking in Westborough, Ashland, and Natick before finding the perfect house: a ranch on a leafy street in Framingham. It even has a two-car garage.

“COVID did have an impact on how much we wanted a yard and parking,” Bahn said. “We plan to be here forever.”


Hayley Kaufman can be reached at hayley.kaufman@globe.com.