Stability seen weaving its way back into housing market

This Sept. 25, 2019, photo shows a sign indicating a new selling price for a house sits atop a realtor's sign in Jackson, Miss. On Tuesday, Oct. 22, the National Association of Realtors reports on sales of existing homes in September. (AP Photo/Rogelio V. Solis)AP/Associated Press

An unusual thing is creeping into Greater Boston’s housing market this fall: choice.

Even as home prices continue to tick upward, would-be buyers are finding just a little bit more breathing room in a market that has long been characterized by an almost-frantic race to lock down a house, new numbers about the state’s housing market in September released Wednesday reveal.

“It’s kind of evening out,” said Jim Major, president of the Greater Boston Association of Realtors and an agent at Century 21 North East in Woburn. “I’m not saying we’ve returned to a buyers’ market but it looks like we’re moving toward something more stable.”

In case anyone has forgotten what a stable housing market looks like, it means fewer bidding wars, and a few more days on the market. It means sellers occasionally having to cut asking prices. It even means buyers who find something wrong during inspection coming back to renegotiate, instead of just eating repair costs themselves. That’s all happening more than it did during the go-go days of the last few years, Major said.

But to be clear, the cost of buying a house is still on the upswing.

The median price of a single-family home in Massachusetts in September climbed 5 percent compared to the same month in 2018, to $399,000, according to real estate data firm The Warren Group.

Condo prices increased 14 percent to $$375,000, thanks partly to new, high-end, buildings opening in Boston. Sales volume edged upward, too.

But importantly, the number of options in the condo market increased, with more listed for sale in September; and both houses and condos are staying on the market a bit longer — signs, Major said, of buyers growing choosier.

“People don’t seem to be pulling the trigger as fast as they were,” he said. “They’re less willing to accept imperfect properties. HGTV [type] homes, they’re going to sell, but people don’t want a fixer-upper.”

Of course, there are wide variations: At the higher end of the market, north of $1.5 million, homes are sitting longer; the same in affluent suburban towns over urban hotspots. Homes at lower price points, and in more-affordable parts of the region, are selling faster, with prices rising faster too.

Over the last few years, said Tim Warren, chief executive of Warren Group, the places in Greater Boston with the fastest price growth included Roxbury, Chelsea, East Boston, and Everett, traditionally less-expensive cities and neighborhoods close to the core of the region.

“It seems as though typically wealthy suburban communities, and even some of the places that saw huge gains earlier in this cycle — like Cambridge and Jamaica Plain — have given way to more blue-collar communities,” he said. “It’s about affordability.”

But it’s only affordable for those who can access it. Prices have surged out of reach of many longtime residents of those neighborhoods, and the number of homes for sale has dwindled.

The number of homes listed for sale in the bottom third of the market — below $384,250 — has fallen by 22 percent over the last year, according to real estate website Zillow, and are at their lowest level since at least 2013. Price cuts are also far less common in that end of the market.

“That’s the place most first-time buyers look,” said Zillow economist Jeff Tucker. “People wanting that first home are willing to pay whatever it takes to get in the door.”

It’s a dynamic that has played out in other high-priced markets around the country, Tucker said. In such places as Seattle and Silicon Valley, even affluent homeowners are hitting the limits of what they can buy next, while first-time buyers bid up what little they can find in their price range.

Lower interest rates have boosted demand after a broad slowdown last fall, but home shoppers are still taking a breath before they leap.

“Buyers still have a feeling of a bit more control,” Tucker said. “There’s a little less need to race through the process.”

Major agrees. Barring a deep recession, he doesn’t foresee a downturn in home prices here any time soon. The job market in Greater Boston remains strong, and the region’s huge population of 20- and early-30-something renters will naturally fuel demand as they seek to settle down. But they’ll have to be able to afford to buy something, which will require some supply and stability.

“We’re starting to see that,” he said. “I think it’s healthier.”