As the year wound to a close, Boston’s housing market was still treading water, though in a very fancy pool.
Prices of single-family homes in the metro region ticked up in November, while those for condos were flat, and the overall volume of sales continued their monthslong slide as owners contemplating putting a “for sale” sign in the yard decided to just stay put.
Taken together, the figures from the Greater Boston Association of Realtors point to a market that, while certainly pricey, is significantly less frenzied than it was a year or two ago, when buying a house here usually meant a bidding war, fought at lightning speed.
“The market is definitely becoming more balanced,” said Jim Major, an agent with Century 21 North East in Woburn and president of the association. “While there [is] still some modest price growth occurring in the entry-level market and select communities where listings remain in short supply, the rate of appreciation in home values has largely subsided. Home prices have either peaked or plateaued in many areas and could moderate further in the months ahead if supply levels grow.”
Supply, though, has been a limiting factor in the market for some time now, with inventory tight and new listings sparse. That trend continued in November, with the number of homes on the market down 11 percent from the same month last year, according to GBAR. At the current pace of sales, the inventory of homes on the market would sell out in about 2½ months; housing market analysts consider six months to be a healthy supply.
One big challenge, real estate experts say, is that properties have become so expensive that many would-be sellers can’t afford to trade up.
“For a lot of home sellers, the market is a bit of a paradox right now,” said Anne Meczywor, president of the Massachusetts Association of Realtors. “Demand and prices are high, so selling can be relatively quick and potentially profitable, but with historically low inventory, these sellers are concerned with having nothing to buy after the sale.”
The median price of a single-family home climbed 2.3 percent to $599,900 in November, according to GBAR, and for the full year through November, prices increased just 1.6 percent, a clip far slower than over the last few years. Condo prices are even flatter, unchanged from last November at $560,000, and up just 0.3 percent through the first 11 months of the year, despite the fact that mortgage rates have been falling for much of 2019, and are significantly below the levels of a year ago.
The number of days a property sits on the market is creeping up, too, and more homes are selling below their initial asking price. The report covers some 62 communities inside and around Interstate 495, with some exceptions on the North and South Shores.
Those are all signs, said Major, that the market is approaching something like normal. Buyers are responding accordingly, he said, and sellers should get the message.
“There is less of a sense of urgency among today’s buyers, and they’re showing more sensitivity to price and condition as the market has showed signs of cooling,” he said. “As a result, homes are sitting on the market longer and owners need to be more realistic in their pricing if they expect their property to sell.”