Massachusetts; At last, home buyers may get an edge
neponsetvalleydailynews.com
Boston Herald Staff
Friday, June 6, 2003
Experts say the Bay State's long-running seller's market in home sales might have finally run out.
I think we're approaching not a buyer's market or a seller's market, but an even market, said Judy Moore, president-elect of the Massachusetts Association of Realtors.
Moore, a real-estate estate broker with RE/Max Premium Property in Lexington, says it's the first time she's seen anything other than a clear-cut seller's market since about 1996.
We've had a strong seller's market for years now, but it can't go on forever, she said. Real estate works in cycles, so this is just a natural turn of events.
Figures from the Massachusetts Association of Realtors last month showed single-family-home sales in the Bay State fell 10 percent in April 2003 compared with April 2002. Condo sales fell 4.9 percent.
Prices remained firm, with the average single-family home fetching $350,196 in April - up 6.8 percent from April 2002. Condo sale prices likewise rose 5.3 percent year-over-year to a $254,136 average.
Real-estate agents blame the falloff on the weak economy, hard-bargaining buyers and lousy weather.
Fred Meyer, owner of University Real Estate in Harvard Square, said sales finalized in April generally began with buyers looking at houses in January and February.
Bad weather in those months sidelined many would-be purchasers, he said.
On the other side of the coin, experts say sellers benefited from a housing supply that hasn't grown as fast as New England's economy.
More importantly, buyers can lock into mortgages at rates not seen in about 50 years.
Moore said renters see the low rates as their chance to buy, while some owners are trading up.
Robert Burge, of Chelmsford, is doing just that, selling his home of six years to buy a new one in Dunstable.
Burge plans to ask $539,000 for his four-bedroom colonial - triple what he paid in 1996 - and isn't worried about finding a buyer.
I still think it's a seller's market, Burge said.
Economists don't expect a repeat of the early 1990s, when Boston-area home prices tumbled after years of massive gains.
Lawrence Yun, senior economist at the National Association of Realtors, said Boston prices fell in the early 1990s amid much bigger job losses and rising mortgage rates.
He added that Boston's housing supply remains tight, buoying prices up. Over the past 10 years, Boston has only added one new housing unit for roughly every six jobs created, Yun said, vs. a national average of one unit for every 1.5 new jobs.
Nicholas Perna, former Fleet Bank chief economist, said the early 1990s also saw excess housing stock from the 1980s building boom.
I don't think you're going to see the price pressures across New England that we saw in the early 1990s, he said. It took massive unemployment, bank failures and higher interest rates to produce that. |
