Boston: Snowbound and Down (Jan. 2011 Insider Report)

Welcome to the first ever Insider Report for the Boston area. This is your peek behind the scenes at what is really going on in the local real estate space — we’ll tell it like it is using on-the-ground insights backed up with cold hard stats from the industry’s most comprehensive database of broker- and owner-listed homes, as well as public records and our own brokerage activity. We hate sales mumbo jumbo as much as you do, so we’ll leave that part out. If you’d like to receive the report via email each month, just sign up!

Now, without further introduction, onto the report!

Snow, snow, and more snow! Winter is always harsh on Boston’s real estate market, but this year has been a particularly dreadful nightmare. “I think everybody is pretty tired of the snow” says Alex Coon, Redfin’s Market Manager in Boston. “The over abundance of frozen water is really wreaking havoc with demand, closings and the inventory as things have been hard to get into to, leaking and generally snowbound.”

Inventory is on the rise and sale prices are creeping up in and around Boston, but the especially harsh winter weather is putting a serious damper on sales. Read on to get the latest read on the market as we serve up a one-two punch of data and front lines insights from your local Redfin team.

More Homes to Choose From

City Compared to December 2010

Compared to January 2010
Single Family Houses
Boston +1.9% +18.3%
Condos
Boston +8.9% -3.8%

Cambridge +8.3% +32.0%
Somerville +10.1% +7.6%
Brookline +12.6% -5.8%

Change in # of Houses for Sale on January 31st 2011

While inventory is climbing across much of the Boston area, Cambridge has seen a particularly big increase year-over-year in condo inventory. Adam Welling, Redfin Lead Agent and Somerville resident has certainly felt the increase in inventory. “Cambridge has always been short on number of available properties, but lately I am hearing from lots of customers that they feel they have more homes to choose from right now.” That trend is not likely to last long though, as things traditionally pick up quickly when the weather improves. “I have seen a real increase in the number of condo conversions and re-sales,” said Adam. “Renovations are on the rise as well.” Adam suspects the inventory will tighten up quickly when the weather breaks and is already seeing a sharp increase in multiple bids situations.

Good New Inventory Gets All the Sales Attention

City Compared
to Dec. ’10
Compared
to Dec. ’10
Adjusted for
# Weekdays
Compared
to Jan. ’10
Compared
to Jan. ’10
Adjusted for
# Weekdays
Single Family Houses
Boston -36.3% -30.2% -5.3% -5.3%
Condos
Boston -53.0% -48.5% -25.3% -25.3%
Cambridge -56.8% -52.6% 0.0% 0.0%
Somerville -56.8% -52.6% -20.0% -20.0%
Brookline -61.8% -58.2% -50.0% -50.0%

Change in # of Houses That Sold in January 2011

Hannah Driscoll, Redfin’s Lead Agent for Boston, has seen a lot of buyers waiting for new inventory and although touring has stayed strong in the face of the awful weather it has certainly taken its toll month over month. “What’s really been happening is when the sun is shining and people get moving, I have seen multiple bids on all of the good properties that were new to the market. We are all looking forward to more inventory and less snow!” If demand grows as the snow melts and inventory doesn’t rapidly pick up it looks like we’re shaping up to have a competitive summer.

Prices Stable in Boston, Shaky Further Out

City Median Price in
January 2011
Median $/SqFt Change
since December 2010
Median $/SqFt Change
since January 2010
Single Family Houses
Boston $347,500 +6.8% +16.8%
Condos
Boston $370,000 -15.3% +3.1%
Cambridge $382,500 +1.3% +5.3%
Somerville $336,500 -14.7% -7.8%
Brookline $425,000 -2.9% -4.6%

Change in Median Price of Houses That Sold in January 2011

Median price in both Boston and Cambridge have stayed relatively stable and even increased in January. It certainly feels like we may be entering a time of market stability, at least around condos in the metropolitan area. The weather has battered the market and inventory but the subsequent cabin fever, creeping interest rates and improving unemployment all seem to point towards another brisk and hectic spring. Just no more snow, please.

Want to know what’s happening in your neighborhood? Download our comprehensive spreadsheet and dig into the data for yourself! Inside you’ll find county, city, and neighborhood information galore. To learn more about how we calculate these numbers, check out our methodology page. You can also liven up the place by posting a comment below.

Best,

Alex Coon
Boston Market Manager