Massachusetts Weekly Real Estate Market Report - December 3, 2023
YOUR Massachusetts Real Estate Market Update for the week of December 4th
Ahhh… I didn't see that coming. Just a shocking development when it comes to inventory this week.
In this video we will go over the Single-Family and condo markets in the state of Massachusetts. And we will also do a quick interest rate update… And we will also talk about some relevant current events.
Hi I am Jeff Chubb – A recovering Investment Banker turned Real Estate Agent that has sold more than a 1,000 homes. If you have any questions about the real estate market, then know I am here to help.
So the decrease in interest rates is working… This was a busy weekend. And it wasn’t just for me. One of the offers that we got accepted this week was going up against six other offers.
And in case you were wondering. He was able to do a home inspection, but we had to put a higher inspection threshold amount and he also offered appraisal gap coverage. And obviously went over the asking price. Just a heads up for Spring buyers… It looks like it’s about to get crazy.
By the way, if you are an investor who is looking for off market houses, then reach out as I would love to hear what your buy boxes are. We get off market opportunities each and every day and I would love to play a little game of matchmaking.
And just as a heads up, these off market opportunities are cash or hard money only investments. No conventional financing is allowed.
Let’s get into it all and jump into the Single-Family market stats.
You can kind of see it here. The drawdown of inventory leveled out. There are now 4,068 single family homes on the market in the state of Massachusetts. This means that there are 13.8% fewer houses on the market today than 28 days ago as inventory fell by only 58 units last week.
Historically speaking we see inventory levels continue to drop at big numbers at this point of the year. So what was the reason, was it because a bunk of new listings hitting the market or a big decrease in buyer demand? Let’s find out.
This graph shows the prominence of what happened much better. It’s like the Fall Drawdown just hit the pause button last week!
When we look at the inventory gap for 2023 vs 2022 then we now have 423 fewer homes on the market then the same time last year. To put this 423 houses in perspective, that number was 566 last week.
And then when compared to 2021, the gap expanded to there now being 983 more homes on the market this week then compared to the same week in 2021. That is a 65 unit increase this week.
Saying it in a more elegant way, buyers today have 983 more houses to look at today then in 2021 and 423 fewer houses to look at when compared to the same time in 2022.
I mean you can barely see the blue line. It's so similar to this week last year!
There were 621 Single Family homes that came on the market this week. This was 11 or 1.8% more units than the same week last year when 610 Single Family homes came on the market.
The 4 week rolling average is 667 units. But as we have mentioned, from now until the end of the year, we won’t really be worried about these 4 week rolling averages as the market does its seasonal slowdown.
Under agreements didn’t see the bounce that we generally see this week.
We had 554 homes go under agreement which was 18.1% less than the same week last year when 676 single family homes went under agreement.
Last week we broke out of that 10 to 15% range that we have been seeing for the last couple months, but we were at 7%. This week we broke out of that range and were at 18%. So last week was -3% and this week it was plus 3% out of that range.
In other words, I think the data is saying that the boost in under agreement activity from last week may have cannibalized a little from this week.
The four week rolling average is 742 units. So we were below the 4 week rolling average for Under Agreements as well.
So when compared to last year's market… New listings were up by 1.8% while under agreements were off by 18.1%.
There were 913 Single Family homes that closed last week for an average sales price of $753 thousand dollars and a median sales price of $610 thousand dollars. Sales levels compared to the same week last year were down by 9.3% as there were 1,007 Single Family homes that sold this week last year.
Months of inventory. This is how we determine what type of market we are in. 0 to 5 months is considered a sellers’ market with the closer to 0 you get… The more aggressive a seller’s market.
This week Months of inventory ticked up to 1.57 months from last week's 1.54 months. The 1.57 months this week is compared to the 1.38 months this week last year.
Real quick, my shameless plug… I just wanted to mention that if you are thinking about buying or selling a home, then it would be a true pleasure to help!
Now onto the Condo market…
The condo market saw the same thing as the Single Family market. The inventory decline leveled off. The pause button was hit here too! We have 2,321 condos on the market as of Monday. This is a 39 unit decrease from last week. Currently, there are 11.6% fewer condos on the market today than 28 days ago.
I know I am a data nerd, but next week is going to be so interesting for me. We have been doing a great job threading the needle between 2021 and 2022 when it comes to inventory in the condo market. But it looks like that could all change as we are now toe to toe with 2022.
We now have 222 more condos on the market today than at the same time in 2021. And only 10 fewer condos for buyers to look at when compared to the 2022 inventory levels.
Again, just like the Single Family data… You can barely see the blue line this week as it was so similar to this week last year!
There were 296 condos that came on the market with a four week rolling average of 287 condos.
We listed 7 or 2.4% more condos this week than the same week last year when 289 condos came on the market. You can view all the Boston Waterfront Homes for sale here.
Again, just like the Single Family market, we didn’t see the bounce in under agreements that we would have expected. This week we put 216 units under agreement. This 216 units was 63 units or 22.6% shy of last year's numbers when we put 279 condos under agreement. As a side note, the 216 this week can also be compared to the 215 properties that went under agreement last week!
The four week rolling average is 289 units.
So 2.4% more listings that came on the market when compared to this week last year while selling 22.6% fewer condos. And that would explain the inventory growth that we saw this week!
There were 397 condos that sold this week for an average sales price of $696 thousand dollars and a median sales price of $540 thousand dollars. This same week last year there were 373 condos that sold. So sales levels were down by 6.4%.
Months of Inventory increased to 2.20 months from last week’s 2.16 months. This is compared to the months of inventory levels of 1.91 months this week last year.
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Time to talk about Interest rates…
When I looked at the chart this week… The Miley Syrus song… It’s a Party in the USA just popped to mind. Continued improvement in the interest rate world. Rates were down this week. Three new pre-approvals this week… And you know what was on all of them? An interest rate in the high 6s.
Rates are now at a 3 month low. I could see them leveling out a bit from here until the next big economic news… But ultimately FED Chairman Powell spoke about how they could increase the FED fund rate again and the market just yawned at him.
I can’t stress enough. The more these rates go down, then the hotter this market will go. The hotter this market gets, then the more pricing will jump with buyers getting worse terms like not being able to do a home inspection.
NOW is the time to buy. Because the ingredients for the Spring Cake are starting to get put together… And it is starting to look like it’s going to be a tough market in the Spring and possibly all of next year for buyers. Buy now before that cake of higher prices and crappy terms is baked.
What if I told you that I am hoping that the FED doesn’t decrease rates… At least yet. Before the name calling begins, let’s talk about why.
It’s important to say that all the big money is betting a decrease in rates in the first quarter of 2024. And I think they could be right. My reasoning for this is as simple as it’s an election year. A booming economy helps the current administration.
But booming at what expense. I have talked about a head fake with inflation rates. The reason I have said this is because I have gone back in history and looked at what happened in the 1970s.
Everyone felt that inflation was under control, so they had a celebratory party and started loosening policy to only have inflation roaring back even worse than it was before. Que the 18% interest rates in 1980 that were needed to stamp out inflation.
Sometimes our best intended wishes aren’t what’s really best for us. And while I am reporting the news of lower rates and a pickup in buyer demand… I don’t think it’s really a great thing for our overall long term economy. It’s the political playbook 101. Rather than really dealing with the issue, let’s put a bandaid on it and kick the can down the road only to have that can grow into a much bigger problem.
I guess what I am saying is that we should be careful what we wish for… Because there are always consequences. Wish for lower rates. Enjoy a hotter market with higher pricing and worse terms. Wish for a market collapse. Enjoy a depression like economy where friends and family lose their jobs, savings and their homes. Afterall, it's a Recession when your neighbor loses their job. It’s a Depression when you lose yours.
I just released my last monthly Market Report for 2023… Insane. If you missed it, then you should definitely take a look. Plus, I just did another video talking about the market returns for the city of Boston! Watch that one too… And let me know what you think.
Want to talk about your personal real estate needs?
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Until next time.