An article in Boston Globe last Friday states that condo prices in Boston are high and sales are down. As a matter of fact the article states that sales prices in several Boston neighborhoods including Beacon Hill, Back Bay and the South End are up 9.2 % from this time last year. One broker quoted in the article explains that Boston’s inventory remains low and that we have not really had a surge in inventory. Actually there were 1037 properties on the market in September as compared to 1039 properties on the market in September of 09’. In the luxury condo market, condominiums that have full service features such as concierge, fitness facilities, valet parking, etc …, prices have swelled to a median sales price of $680,000.00 the article went on to explain. Another broker featured in the article says that is because the high end luxury market has picked up and wealthy buyers are bringing up the median sales number.
What does this all mean? In my opinion it means several things. To begin Boston’s lack of inventory and entrenched industry fortifies the housing market against catastrophic declines as we saw in other cities across the country. Secondly we’ll certainly see a tempered decline in sales prices before we see a marked increase in sales. I would look at it like an adjustment. I think that this process is either under way or beginning to take hold. There are definitely a lot more buyers circling the market then a year ago. As more buyers help to establish this market prices will begin to taper off and sales will gain momentum. I suppose at this point we sit back and enjoy the ride!