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Home > How the Market?

How the Market?

February 1, 2022 by Page Innis Leave a Comment

Throughout the year I get the question How is the market?  What do you predict the market will do? It’s a common question experts have to answer and in the new year the question comes up a lot.  I was catching up with a college friend in Florida she wonder if she and her husband should sell their fully renovated home in Florida. I wondered what brought on this question. Naturally, I had to ask the question, and she was worried that the Florida real estate market would tank.  The great prices she is seeing will be a distant memory. I gave her my gut feeling which was her area prices will continue to rise. In fact, my thoughts were confirmed when I spoke to another friend in Florida. 

 Since everyone asks me in the new year what the real estate market is doing, and how it is performing  I decided to do a weekly Instagram post on the subject featuring different areas, and a blog post might be a good idea as well.  In order to know what direction of the market you must look at the year that we just closed. 

Back Bay 

Back Bay 1st Quarter 2021 2nd Quarter 2021 3rd Quarter 2021 4th Quarter 2021 Yearly Sales 
Number of Sales 74 129 126 112 442
Average Sale Price $1,993,383.00 $2,020,361 $2,312,533 $2,972,135 $2,346,482
Medium Sale Price $1,160,000 $1,200,000 $1,350,000 $1,307,500 $1,287,500
Average PSF $1,267 $1,294 $1,398 $1,169 $1,396
Med PSF $1,146 1183 $1,204 $1,312 $1,202
Days on Market 113 97 128 61 102

 

The takeaway from the 2021 market reports the demand is still strong. Listings overall stay on market longer, however, homes in the Back Bay are still selling not far from the asking price. Sellers in 2021 still saw bidding wars. The quarter that saw the highest offers were over asking was the second quarter. Second-quarter 6% of offers were over asking in Back Bay. Every quarter in 2021 prices didn’t go down they just went up. The average sale price went up every quarter.  

Beacon Hill

Beacon Hill 1st Quarter 2021 2nd Quarter 2021 3rd Quarter 2021 4th Quarter 2021 Yearly Sales 
Number of Sales 37 129 60 45 209
Average Sales Price $1,656,634 $2,020,361 $1,353,565 $1,438,690 $1,409,609
Medium Sales Price $845,000 $1,200,000 $867,500 $900,000 $880,000
Average PSF $1,218 $1,329 $1,174 $1,211 $1,207
Med PSF $1,147 $1,183 $1,142 $1,152 $1,160
Days on Market 120 97 67 81 82

Beacon Hill the first thing that jumped out to me was prices went down vs up. The only quarter that saw an increase was the second quarter. The second quarter was the strongest average sales. The days on market were the second-longest. Most buyers are in the marketplace from March to June.  Boston real estate is no different. Going into the third-quarter average home prices begin to slide. Were there any factors at play going into the third and fourth quarters?  Covid was coming into focus again in July which maybe covid was starting to influence buyers and sellers.  

Buyers were still eager to buy, but they were not accepting the price seller was presenting.  Furthermore looking at the sales history only one quarter that saw homes sell above asking was the second quarter.  Four percent in the second quarter sold over asking, but every other quarter the percentage was a lot less ranging from 1% to 3%.  A few conclusions could be made either the buyer is fatigued of bidding wars, lack of good inventory or the market might be adjusting.

Charlestown

Charlestown 1st Quarter 2021 2nd Quarter 2021 3rd Quarter 2021 4th Quarter 2021 Yearly Sales 
Number of Sales 82 1,387 93 79 393
Average Sales Price $850,063 $1,159,009 $809,297 $862,583 $854,211
Medium Sales Price $807,000 $825,000 $705,000 $746,000 $749,000
Average PSF $737 $984 $774 $796 $767
Med PSF $728 $904 $784 $785 $764
Days on Market 85 70 49 36 59

 

Like Beacon Hill second quarter in Charlestown was the highest quarter of sales it was the only quarter where the average sale price was at its highest. Again this is the quarter March to June when buyers are at their highest and supply often isn’t equal so it makes sense the average sale price was highest. There were no big construction projects that were closing that would also alter the second quarter to sell higher. The days on market were still higher than the third and fourth quarters but prices during the third and fourth quarters were lower.  The quarter that saw the highest over asking prices again was the second quarter but when you look at the year as an average 14% of sales were over asking.  

East Boston

East Boston 1st Quarter 2021 2nd Quarter 2021 3rd Quarter 2021 4th Quarter 2021 Yearly Sales 
Number of Sales 115 1387 259 98 692
Average Sale Price 638,212 $1,159,009 $708,906 $648,917 $696,494
Medium Sales Price $615,000 $825,000 $643,000 $606,500 $639,900
Average PSF $628 $984 $795 $714 $751
Med PSF $588 $905 $739 $680 $713
Days on Market 176 70 82 143 122

 

Once again second quarter we see the largest amount of listings on market in East Boston, and due to supply not matching the demand I would guess that has pushed home prices up.  If you look at other quarters less inventory on market but what is on market either isn’t fantastic to purchase or it’s not priced right. First-quarter only 2% of homes sold over asking but the rest minus second quarter which was close to 6% of homes sold above asking but other quarters it was 1 to 2% if any. In the final quarter of the year zero homes sold over asking. The average sale price was higher for the end of the year but could there be a shift happening in the marketplace? 

Fenway 

Fenway 1st Quarter 2021 2nd Quarter 2021 3rd Quarter 2021 4th Quarter 2021 Yearly Sales 
Nmumber of Sales 44 1,387 50 25 179
Average Sales Price $801,207 $1,159,009 $733,311 $774,873 $803,542
Medium Sales Price $707,500 $825,000 $643,500 $625,000 $649,600
Averge PSF $1,653 $984 $981 $1,004 999
Med PSF $1,042 $905 $976 $979 970
Days on Market 80 70 63 68 77

 

Fenway is one of those neighborhoods in 2020 that took a dive in both rentals and sales and started recovering in 2021. However, in 2021 Fenway only had one quarter over asking, and that was the first quarter. It may make sense that was only a quarter it saw over asking since College Students were returning back to campus so the idea of buying for their child made more sense than renting and pricing was attractive enough to pull the trigger.

Again second quarter saw the most inventory and highest averages. First-quarter saw 4% of sales over asking but the rest were less than 1%. During the third-quarter prices came down and that would be around the time delta was in the environment and the reality of masks in public and no large gathers came up again so you could think maybe pricing took a hit but we did rebound on last quarter and the yearly average was not like a second quarter but was typically higher than most quarters.  

Midtown 

Midtown 1st Quarter 2021 2nd Quarter 2021 3rd Quarter 2021 4th Quarter 2021 Yearly Sales
Number of Sales 33 1,387 44 26 144
Average Sale Price $1,484,380 $1,159,009 $1,664,625 $1,877,553 $1,726,930
Medium Sales Price $1,230,000 $825,000 $1,165,000 $1,445,000 $1,300,000
Average PSF $1,026 $984 $1,161 $1,217 1144
Med PSF $1,061 $905 $1,088 $1,181 1087
Days on Market 162 70 341 25 139

Midtown is interesting since every other neighborhood I have featured in this post-second-quarter has had the highest choices for buyers, but it also has been the time where the highest average sale price has popped up. However, looking at Midtown the highest average sale price is the fourth quarter and furthermore had the shortest days on market 25. So what is going on here? There were no big projects in the area that would cause prices to sell for higher.  Midtown is a bit of a unique area most of the buildings are older minus 45 Providence and Millenium Place and Millenium Towers.

However, when you take a deeper dive into the numbers there were two sales that closed in the fourth quarter that most likely pushed the average sale price up, and had those properties not closed the average sale price would be much less. One Franklin 306 closed for $5,250,000 and 2 Avery unit 25C closed for $3,150,000. Both of them closed in the 4th quarter.  The only quarter that condos sold over asking was the second quarter and that was 4% over asking. I would guess homes on market during that time were priced way under what they should be, and demand was normal. 

North End 

North End 1st Quarter 2021 2nd Quarter 2021 3rd Quarter 2021 4th Quarter 2021 Yearly Sales 
Number of Sales 18 1387 30 24 107
Average Sale Price $678,300 $1,159,009 683,183 860,521 762,052
Medium Sales Price $641,500 $825,000 $599,500 $677,500 $670,000
Average PSF 781 984 $955 $904 $896
Med PSF 828 904 $978 $905 8$92
Days on Market 70 70 6 107 89

Unlike Midtown where the average sale happened in the final quarter, North End performed like most neighborhoods in Boston. Second-quarter saw the most listings that hit the market and had the highest volume in the marketplace. However, unlike the second quarter where we saw over asking offers, it was the first quarter that saw the highest percentage at 6%. The demand clearly was around the supply wasn’t enough so folks most likely overbid to get the home of their dreams and interest rates were lower at that time. Second-quarter peak season so sellers put their homes on market for higher and it bumped up the average sale price.

Going into to third quarter that was the start of Delta being the dominant strain, and restrictions started coming back so it could have influenced buyers and sellers, but keep in mind the days on market was lowest so it could just be inventory wasn’t great and buyers sat back and seller adjusted. Maybe the price was starting to matter more to a buyer, but the desire to own hadn’t really decreased. 

Seaport 

The Seaport is still considered Boston’s Newest neighborhood. It’s also an area with the highest concentration of new construction. Prices are often higher in the seaport than in other parts of the city. 

Seaport 1st Quarter 2021 2nd Quarter 2021 3rd Quarter 2021 4th Quarter 2021 Yearly Sales 
Number of Sales 57 1387 68 50 253
Average Sale Price $1,556,001 $1,159,009 2,175,082 $1,986,611 $2,048,448
Medium Sales Price $1,245,868 $825,000 $1,689,500 $1,597,000 $1,495,000
Average  PSF $1,450 $984 $1,559 $1,519 $1,537
Med PSF $1,557 $905 $1,593 $1,587 $1,580
Days on Market 154 70 142 63 106

Seaport district in the third quarter not only did the average sale price increase but so did medium sale price and when I took a deeper dive there were alot of homes that closed over 5 million and up which is going to adjust numbers up.  In the final quarter, there were fewer properties that closed so averages dipped, but look at days on market. The properties that did sell sold 79 days sooner. I would guess in 2022 we will still see higher prices since alot of the buyers who buy in seaport tend to be cash, but not all, and with rates rising some buyers might look at other options which might make prices drop a little. 

Seaport Sales History building
 
   
Property Address Sale Price
   
22 Liberty Dr 6M $4,550,000
22 Liberty Dr9M $4,750,000
22 Liberty Dr 7F $4,800,000
22 Liberty Dr PH1F $9,375,000
   
300 Pier 4 Blvd 3D $4,499,000
300 Pier 4 Blvd 7D $5,179,000
300 Pier 4 Blvd PHF $5,495,000
300 Pier 4 BlvdUnit PHN $6,765,000
   
135 Seaport Blvd Unit PH 2C $4,595,000

South Boston 

South Boston is right next door to Seaport District, and in 2020 prices dropped. The days of stuff moving disappear in 2020 and in 2021 the market returns and prices rebounded. As I have mentioned before the big quarter seems to be the Second quarter that there is more inventory and more demand, but looking at the numbers appear to go up in the third and fourth quarters. The Days on market also increase. There was not one quarter in 2021 where homes sold above asking though. 

South Boston 1st Quarter 2021 2nd Quarter 2021 3rd Quarter 2021 4th Quarter 2021 Yearly Sales
Number of Sales 172 292 261 174 891
Average Sale Price $764,635 $812,105 $828,852 $903,212 $824,482
Medium Sale Price $699,250 $765,000 $780,000 $775,000 $765,000
Average PSF $724 $766 $797 $802 $773
Med PSF $710 $760 $792 $799 $762
Days on Market 92 65 71 89 83

South End 

South End is home to fantastic restaurants, local cafe’s and local shops you know and love. The South End didn’t buck the trend where the strongest quarter was the second quarter. Second-quarter also offered buyers in the competitive market the most options. There were 1387 sales in 2021 second quarter and four perfect of sales second quarter sold for over asking.  It was also the one-quarter of homes sold quickly.

South End 1st Quarter 2021 2nd Quarter 2021 3rd Quarter 2021 4th Quarter 2021 Yearly Sales 
Number of Sales 101 1387 174 117 768
Average Sale Price $1,167,245 $1,159,009 $1,206,599 $1,299,833 $1,232,489
Medium Sale Price $930,000 $825,000 $949,800 $975,500 $969,950
Average PSF $1,061 $984 $1,068 $1,177 $1,099
Medium PSF $1,068 $905 $1,060 $1,146 $1,083
Days on Market 90 70 67 49 69

What is interesting is the second-quarter average home price was not at the highest that show up the fourth quarter. The Average Sale price continues to climb every quareter, but the days on market start off high be continue to decline overall.  When looking at the data it said to me the market was returned back Buyers were less likely to get into bidding wars. Homes sold most quarters only saw 3% in the bidding war zone and in past years this number has been higher.

Waterfront 

Waterfront 1st Quarter 2021 2nd Quarter 2021 3rd Quarter 2021 4th Quarter 2021 Yearly Sales 
Number of Sales 52 1387 52 34 163
Average Sale price $1,425,760 $1,159,009 $1,425,760 $1,401,224 $1,323,890
Medium Sale Price $1,069,500 $825,000 $1,069,500 $1,250,000 $1,050,000
Average PSF $1,002 $984 $1,002 $1,012 $1,013
Medium PSF $913 $904 $913 $935 $940
Days on Market 79 76 79 52 80

Waterfront saw the most inventory in the second quarter but the highest sale price was also in the third quarter. The fourth quareter was the lowest average sale price, but also saw the shortest days on market. Second-quarter was the only quareter where home sales went over asking by 5%, but the average home price was the lowest. 

West End 

West End 1st Quarter 2021 2nd Quarter 2021 3rd Quarter 2021 4th Quarter 2021 Yearly Sales 
Number of Sales 11 14 15 17 57
Average Sale price $804,545 $629,121 $675,160 $724,676 $703,589
Medium Sale Price $700,000 $608,750 $655,000 $640,000 $640,000
Average PSF $672 $666 $727 $776 $716
Medium PSF $668 $637 $686 $768 $682
Days on Market 134 N/A 62 N/A 98

The West End is not a big neighborhood some would say isn’t that Beacon Hill or Downtown? The west end is a pretty small neighborhood and it’s not an area that has a lot of activity. I would say it’s like Bay Village in a sense it’s a neighborhood but not a big area with high turnover.  Some of the market data is incomplete like days on market. I would guess there is a lot that sells off-market. Unlike many markets in Boston second quarter has been strongest where the most volume hits the market and home prices are the highest, but like Seasport district which saw the strongest sales prices 3rd quarter the west end also follows that pattern. The West End never had a quarter where homes sold over asking.

Conclusion for Buyers  

What will the 2022 real estate market look like in most of these neighborhoods?  The trend last year we never had enough inventory and that will continue to be a trend that will keep prices high, but unlike prior years where buyers could borrow more with interest rates low, this will change. Rates will continue to rise which will push some buyers out of the buying market and into the rental market, and those who can buy will have less money to bid up. So the market will feel a bit more balanced for buyers but will not be cooling off.

Conclusion for Sellers 

Sellers who either don’t have to sell or don’t have a place to move to might wait to sell.  Rents will continue to rise in Boston and areas like Brookline and Brighton will recover to where Boston was last summer.  Buyers who can buy should since prices will continue to rise. If you need to sell now is a great time, but if you need to find a new place to move into you might find you save little in the process. If your like my parents who had a home they already owned to move into then sell your home and start the next stages of your life.  

Lack of inventory will be the issue and buyers will hit their ceiling price faster what is shocking the further you go out you might not get that much more houses and might not see much relief in price and housing stock.  

Contact me if you’re looking to buy or sell and if you are a renter looking to buy but need your current rental rented I can help you there as well.  Contact me and let’s talk. 

 

Filed Under: Market Reports, Neighborhood Information, Real Estate Education, Real Estate News

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Page Innis

Page Innis has been in working in Boston real estate for 13 years. The previous 11 years, she has been a member of the Gibson Sotheby’s International Team. Just like Gibson Sotheby’s she believes that all clients regardless of price point, should be given the white glove treatment. She has a broad range of experience in both sales and rentals throughout the metro Boston market.

Meet Page

Gibson Sotheby’s International Realty

277 Dartmouth Street 2nd floor
Boston, MA 02116

(617) 784-3954 Office
(617) 553-1977 Fax
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