Massachusetts Real Estate Market Update - December 2023

YOUR Massachusetts Real Estate Market Update for December 2023

The best way to say it is that November was a solid month in the Market. It was a great month for most… Unless of course if you are one of those people praying for a housing crash to happen. If that’s you, then this month and this data is going to kind of suck. 

If you are looking to hear about the Massachusetts Real Estate Market data for Single Family Homes, Condos and Multi-Family properties… Then you are in the right place.

Real quick, my name is Jeff Chubb and I am a recovering Investment banker, turned real estate agent that has sold more than a 1,000 homes. If you are planning on buying or selling a home now or in the future, then it would be a pleasure to speak with you. 

Let’s start with Single Families

In November of 2023, we saw 2,953 Single Family homes sell for an average sales price of $735 thousand dollars. 

I mean that was no record setting month, but it was right in line with what we saw in October. The 2,953 Single Families that sold was 11.9% off of last year’s sales numbers when we saw 3,352 homes close. 

Don’t get me wrong. I am not celebrating these numbers. But I am recognizing that they could be a lot worse! The 11% year over year decrease is a heck of a lot better then September when we saw a 26% year over year decrease in sales! 

Like I said last month. At this point we just need to embrace the suck when it comes to the amount of sales in the marketplace. This isn’t going to get much better in the near future. 

Sales and prices are two factors that don’t work in tandem. This monthly data continues to prove that. 

There we go. The year over year appreciation rate has come back to earth. It is safe to say that last month's 13.75% year over year appreciation rate was an outlier. 

But take out October for a second. Do you notice a trend for that graph? It’s been slowly gaining since June. 

With November’s 7% year over year increase, this now means that Single Family home prices have gone up by 4.8% in the 11 months of 2023. That is an increase from last month when the year over year increase was 4.6%. 

Prices going up in 2023 is a certainty. You market crashers got it wrong. Who is willing to bet that home prices are going to go down next year? I would love for you to make a comment below and tell me how much you think they will go down and why. 

Let’s continue to dig into this data and look at the yearly sales comparison. 

Again, don’t get me wrong. It’s not pretty, but it’s getting the job done. The 2,953 sold homes puts our sales levels right around the levels of 2011 when 2,920 houses sold. 

The 2023 real estate story is not about the amazing home sales levels. It’s about the resiliency of the market. We have seen sales levels in line between 2011 and 2012 is what we have seen for pretty much all of 2023. Again, sales wise this wasn’t a great year. But this market took some of the biggest blows someone could throw at it. And while it didn’t get out looking squeaky clean… It also didn’t come out covered in you know what. 

As far as 2024 goes on the sales side… Who knows. Interest rate predictions are all over the place. Lower interest rates will equate to more sales. Higher levels will mean less sales. But for 2024, it’s doubtful that rates will go higher than the peaks we saw this year. And I don’t see any scenario where pricing goes down. 

And that is now 29 Consecutive months! 29 consecutive months of year over year sales declines. This trend will continue into next year. But if interest rates do end up going down… Even slightly, then at some point I see this impressive run come to an end. 

And as we have talked about so many times… Sales levels and pricing gains or losses do not necessarily correlate. Here is the corresponding graph that shows this to be true! 

Less sales and higher prices. It’s pretty much the 2023 narrative. 

This means we have now seen 29 consecutive months of sales declines and FORTY TWO consecutive months of price increases. 

Forty two. In other words 3.5 years. And that is kind of a joke considering it was a .06% price decrease and was in May of 2020… What was going on then… Oh ya, these were the sales from the time period of when the ENTIRE ECONOMY was shut down. 

As you very well know because we have talked about this before… If prices are in fact going to go down… Then we need to see a SURGE of inventory. So let’s check in and see what is happening there. 

No surge of inventory here. It’s where it’s been pretty much all year. Above 2021 levels, but below the levels of 2022. 

Today our inventory levels are down 8.6% when comparing inventory levels to November of 2022.  

Inventory is trending up though. In August we were 22.7% below last year's inventory level. Then in September it was 16.8% and 14.7% below in October and now the 8.6% below when compared to the same time last year. It’s nothing to be concerned about. Inventory levels are still very low. And it does make the market conditions slightly better for a buyer and buyer’s will take what they can get. But these inventory gains aren’t going to do anything to lower prices. 

And inventory levels are still 4.9 times lower than they were when we last had this amount of sales back in 2011. Inventory is still very low. But IF the market sees a pickup as these interest rates have been going down, then that tiny inventory cushion will be blown away very quickly. I really don’t even think you can call this a cushion. Inventory levels just aren’t as bad if you are a buyer. 

The seasonal Fall inventory drawdown is upon us! Buyers now have more homes to look at on the market then they did back in 2021, but still less than the same time period in 2022. 

So based off of what the trend that we are seeing here, we can expect to go into 2024 with inventory levels somewhere in between the levels we saw in 2021 and 2022. 

Why is this so important? It’s because as we have said time and time again… Inventory is what drives pricing. High inventory levels equate to lower pricing. Low inventory levels equate to higher pricing. 

SO, if we are going into the New Year with low inventory levels, then what is a really good probability that will happen next year? You nailed it. Home pricing gains. At least here in Massachusetts that is. 

But as of today, we have 566 fewer homes on the market at the same time in 2022. Meanwhile we have 918 more houses on the market then we did back in 2021. 

Quick recap… So sales in the Single Family market were off by nearly 12% while inventory was off by 8.6% when compared to last year's numbers. 

Home prices are not tied to sales levels. They are tied to inventory levels. Our inventory levels are remaining low as we go into 2024. Interest rates are trending lower as we go into 2024. 2024 isn’t looking great for the housing market is going to crash crowd. 

Okay, things are back to Normal. From a pricing perspective, it’s safe to say that October was an outlier of a month. It happens! 

November of 2022 was 5.8% above the sales prices of November of 2021. So the 7% year over year increase this year is not abnormal. 

This month’s data proves that October year over year sales price increases of 13.7% was an outlier. 

We have the condo market and the Multi-Family market up next…But first, any chance you can do me a huge favor as it helps play with the youtube algorithm? Can you hit that like button? It just makes a huge difference to me as well as my channel. 

For the month of November, we saw 1,224 condos close in Massachusetts for an average sales price of $666k thousand dollars. 

Let’s start with the sales data... 

The 1,224 units sold was a 12.7% decrease compared to last November  when 1,402 units closed. The sales trends continue with it following the trend of a sales level peak in June then decreasing sales in the later months. 

Again, not an awful sales month. November’s sales levels fell in between the levels that we saw in 2011 to 2012. This has been our expectation. It’s when sales levels fall out of this range that we take a deeper dive into. 

I will happily take it. Because if there is one thing that I have come to realize in 2023… Asking if it can get worse is a dumb question. Because it can!

Last month we talked about how the condo inventory levels were ticking up. And this month that continued. 

The inventory levels of 2,385 condos on the market at the end of November of this year for all intents and purposes is equivalent to the inventory levels of 2,398 at the end of November 2022. 

When you compare the inventory levels of today versus the last time we have seen this level of sales, well that where it gets a little interesting. 

As I mentioned earlier, our sales levels put us between the sales levels we saw in 2011 and 2012. Well there was a pretty drastic change in inventory levels this year. We went from 7,232 condos for sale in November of 2011 to 4,791 in November of 2012. 

Based off of 2011s inventory levels, then we currently have 3 times less the amount of inventory on the market. But based off of 2012s data, then we only have 2 times more inventory. 

This should make condo buyers a little happy… Our inventory levels aren’t great, but it’s better than what the buyers in the Single Family market are dealing with. You can view all Boston Waterfront Homes For Sale.

Last month we were talking about how the inventory gap between this year and the last two years was closing. Well it closed on the 2021 levels and is now threading the needle at levels right between 2021 and 2022. As of the end of November we have 145 more units on the market than in 2021 and 86 fewer condos than at the end of November in 2022. 

These lower inventory levels are helping set the stage for a condo market that continues to favor sellers in 2024. And one where we will continue to see price growth. 

As a year over year comparison… Sales were down 12%, but the amount of new listings that came on the market was pretty even to November of 2022. This year we had 1,314 new listings hit the market in November. This is compared to the 1,331 that hit the market in November of 2022. THIS is what buyers want to hear!

Remember how in July home prices were up by 20.7%,  then in August they were up by 13.5% and 15.1% in September and then 9.8% in October? November isn’t turning out to be the last four months, but it’s 7.1% year over year price gain is no slouch either. 

We have seen some very solid pricing gains for condo owners over the last 5 months. 

The average sales price of $666k was 7.1% higher than the average sales price in November of 2022 when it was $622 thousand. 

Last month we were saying that it seems that the trend line has started to normalize with prices leveling out. And I think the November data really puts an exclamation on that theory. 

This continues to be crazy. In the first 6 months of the year the average sales price was up 2.5%. Then when you factor in the last 5 months, then that pricing gain really turns a corner. 

Year to date, we have seen prices up for the condo market in the state of Massachusetts by 7.3%. I was wrong. I thought we would see some pricing growth in 2023 in the condo market, but I did not think it would be anywhere close to this high. 

Conceptually I understood how much inventory levels mattered when it came to prices… But I don’t think I realized how it was truly the biggest factor that dictates whether prices go up or down. That was my professional lesson of the year. 

And now for my very quick shameless plug. If you are thinking about buying or selling a home, then reach out to me today as I would be honored to help guide you through the process.

Now onto the Multi-Family market…

The Multi-Family market calmed down a bit this month… It’s no double digit pricing gain like the last two months… But it was a very respectable month! 

In November of 2023 we saw 382 Multi-Family units sell for an average sales price of $778k. 

The Multi market on the sales side is back to its old tricks again. It looks like last month turned out to be an outlier of a month. Darn. 

The 382 units sold was a 27.1% decrease in the year over year sales levels for November. 

That number isn’t great, but it frankly isn’t that bad. Considering the year over year decrease in sales average for the first 9 months of the year was 34.6%... The 27% is really quite respectable. 

This graph really gives you an idea of how much the sales levels in the multi-family market sucked this month. We have not had sales levels lower than the 382 units that we sold in November of this year since I started keeping track of the data back in 2010. 

Last month was a good month. Maybe October sales cannibalized November’s numbers a bit? Either way. It wasn’t pretty, but it wasn’t exactly ugly. 

Now let’s take a look at the inventory levels. 

Sales are low. Inventory is low… But there is a but. At the end of November, there were 800 properties for sale. Here is the ‘but’ tho. Inventory has been trickling up. The spread between October 2022 and October of 2023 inventory levels was 21.5%. 

The November 2023 vs November 2022 is down to 15%.

The amount of new multi-families coming to the market was pretty similar. This year they were up by 3% year over year as there were 548 newly listed Multi-Family properties in November of 2023 compared to the 530 in November of 2022. 

When you compare our inventory levels today to those of November of 2010, then there are 3.5 times fewer Multi-Family properties on the market. 

Pricing in the multi-family market is a little all over the place from a trend standpoint. But an increase month over month in November seems to be a common characteristic. And this year was no different! The average sales price was up 6.1% year over year. 

This chart continues to show how sales prices have been all over the place this year. But what I am taking away from it is that prices were down 4 out of the first 5 months of the year. Prices have now been up 5 out of the last 6 months of 2023. 

Thanks to the November data, the average sales price for a Multi-Family property in Massachusetts is now up 2.9% through November of this year.. 

September and October were amazing months. They pulled the multi-family market out of the pricing decline trenches. This month continued to build on that. It took the prospects of what looked like what was going to look like a flat year for pricing to a very respectable 2 to 3% pricing gain for the year. 

Want to talk about your personal real estate needs?

My info is in the description below. I always love to talk real estate.

Whether you are looking to buy in the next 9 or 90 days, then I would love to chat with you and find out about your real est ate goals.

And if you are thinking about possibly selling, then we can help you traditionally or even offer you a cash offer on your house for a seamless and stress free sales process. No matter what your situation, we can help you get it done. 

You can also visit YouTubeRealEstateAgent.com and fill in your info then I will reach out to you!

Questions or comments about the market data?

Drop me a line in the comments section below. You take the time to watch the video, so I will always take the time to answer.

So until next time.

 

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