2012 was a record-breaking year for downtown Boston condominium sales.
The total number of condo sales was the highest in nine years (and, presumably, highest ever). Average and median sales prices were also at all-time highs, as was total sales volume.
What to make of 2012? There was a very limited supply of condominiums for sale in downtown Boston in 2012 – inventory was very light. At times there were less than half the typical number of homes for sale – at one point as low as one-third the regular supply.
This appears to have had no effect on people’s buying appetite. Presumably, what we saw in 2012 was built-up demand from earlier years. While no one will ever look back fondly at the 2012 economy, Boston did have a lower unemployment rate than other major US cities, and the US stock market did pretty well (although it didn’t end up much higher than in 2011 – thanks Boehner).
Another thing that’s interesting is that several of the earlier years include sales of condominiums in brand-new developments, whereas no buildings were completed in 2012 – so all of 2012 sales (or, the vast majority) were resales.
Sales volume has increased by 50% since 2004 while total dollars spent on residential real estate doubled – from $730 million to $1.6 billion.
So, are we in a “bubble”? A real estate bubble? I don’t know, I’m not an economist. You could very well argue that more people are buying condos because “money” is so cheap. You could argue the opposite, though, and say that we’ve barely skimmed the surface of demand, that many, many people are waiting on the sidelines, ready to buy, once they feel more confident about the US (and world) economy.
I’m skeptical that a 50% increase in number of sales is the “new normal”; I would have thought we’d stay somewhere between 1,200 and 1,500 sales each year. Perhaps we’ll go back down to that number in 2013.
Pricing-wise, if a cataclysmic world depression (for lack of another word) didn’t bring down prices in downtown Boston, then why would anyone expect the future to be any different.
Tomorrow the sun will rise.
And housing is expensive in Boston.
This data is for the downtown Boston Proper neighborhoods including Beacon Hill, Back Bay, South End, Bay Village, North End, West End, Waterfront, Seaport District, Leather District, Chinatown, and Fenway.
|Number of sales: 1,261|
|Median Price: $455,000|
|Average Price: $579,608|
|Total Market Volume: $730,885,656|
|Number of sales: 1,526|
|Median Price: $506,250|
|Average Price: $639,577|
|Total Market Volume: $975,995,207|
|Number of sales: 1,581|
|Median Price: $490,000|
|Average Price: $641,089|
|Total Market Volume: $1,013,561,059|
|Number of sales: 1,755|
|Median Price: $518,000|
|Average Price: $687,699|
|Total Market Volume: $1,206,912,425|
|Number of sales: 1,664|
|Median Price: $535,000|
|Average Price: $730,167|
|Total Market Volume: $1,214,997,799|
|Number of sales: 1,386|
|Median Price: $528,250|
|Average Price: $711,764|
|Total Market Volume: $986,504,520|
|Number of sales: 1,535|
|Median Price: $570,000|
|Average Price: $822,066|
|Total Market Volume: $1,261,872,034|
|Number of sales: 1,584|
|Median Price: $560,750|
|Average Price: $798,088|
|Total Market Volume: $1,264,171,915|
|Number of sales: 1,906|
|Median Price: $608,750|
|Average Price: $847,329|
|Total Market Volume: $1,615,009,401|
Data collected from third-party sources by MLSPIN
Author: John Keith
John A Keith is a licensed real estate broker in Boston, Massachusetts. He helps buyers and sellers of condos and single-family homes in all of Boston’s neighborhoods.
He is also a writer whose work has appeared in South End News, Boston Courant, Back Bay Patch, and Boston Herald.