Not all markets rose in 2020 — for the first time in years, some Boston neighborhoods saw median home prices stall out, or even fall, as a combination of COVID contagion fears and shuttered businesses cast a shadow over downtown districts everywhere. “Urban living is still attractive, and Boston is a great city — but it’s not as good if you can’t get into a museum or go to a restaurant or go to a movie,” explains Tim Warren, chief executive of The Warren Group, a real estate analytics firm.
While the statewide median price of a condo rose 9.2 percent in 2020, condo prices crept up only 0.6 percent in central Boston (which includes neighborhoods such as the Back Bay, Fenway, and the South End, among others), from $955,000 to $961,000. In Roslindale, the median condo price inched up 1.7 percent in 2020, to $483,000. Condo prices slid 2 percent in South Boston, to $745,000, and 1.6 percent in East Boston, to $563,500.
That effect has bled into early 2021. The median price of a downtown condo sold in January or February was down 19.5 percent compared with the first two months of 2020, dropping from $1.13 million to $909,950. Two months into the new year, condos in Brookline, Cambridge, and Somerville were also selling for less than they had been just before the pandemic.
Those closed sales reflect purchases that began over the winter, though — and a lot has changed since. As more people get vaccinated, many businesses bounce back, and the weather warms, realtors say buyers are returning to the city. But the condo market is still slower than in years past, and may offer interested buyers at least a short reprieve from the feverish pace in the suburbs.
That means people wary of the bidding wars breaking out over suburban single-family houses have at least a fighting chance if they’re aiming for an in-town condo, says Daryl Fairweather, chief economist at Redfin. “I mean, there’s still a lot of people looking to buy — but you don’t have to give up your firstborn child to get a condo.”
There are still people who want to live and buy in downtown neighborhoods, says Melvin A. Vieira Jr., a realtor with RE/MAX Destiny in Boston, and that’s supporting prices. “[But] those who can take their equity out and run to a single-family are doing that.” As a result, condo buyers have a little more negotiating power and time to think through their offer. “Any place in Boston, condos are not selling that fast.”
With close quarters still a lingering concern for some buyers, Vieira adds, the condos that have been selling more briskly are the ones with outdoor space. But it’s the single- and multi-family markets in the city that are the most competitive right now. “Multi-families are going bananas in Boston,” Vieira says, drawing interest from investors and first-time buyers alike.
Fairweather expects the urban condo market to regain momentum as cities reopen, since small living spaces don’t feel as restrictive when people can do more activities outside the home. But beyond that, she says, the types of buyers who will be looking to purchase homes as the economy recovers may naturally and necessarily gravitate toward lower-priced condos.
“For people who haven’t been as secure in their employment, who haven’t seen their wealth increase, and are looking for something affordable,” she says, “a condo is a good solution for a first-time homebuyer who wants to break into the market.”
Jon Gorey is a regular contributor to the Globe Magazine. Send comments to firstname.lastname@example.org.