Boston Residential Real Estate Condominiums Are Performing Well
Residential real estate contacts in the First District uniformly cite a continued slowing in the pace of sales. The Massachusetts real estate market has seen five consecutive months of year-on-year sales declines in detached single family homes. Condominiums in Massachusetts, however, are performing well, setting monthly volume records in both January and February.
The slowing residential sales pace has led to an overall increase in inventory. Compared to about 10 months of inventory at this time in 2005, the Massachusetts market currently features 16 months of inventory. Contacts across New England suggest that the inventory awaiting sale is not evenly distributed across price ranges, but rather that there are many high-end properties on the market, while entry level and midrange properties are tight in many communities.
Residential real estate prices appear to be leveling off. Price appreciation, although still positive overall, is below 5 percent year-on-year in most markets. Contacts feel that the deceleration in price increases is a positive sign; they characterize the New England market as being slower but healthier than in the last few years. Though much of the current year's performance will be determined by spring sales, the general expectation is for prices to remain steady and for the sales pace to be slower than in recent years past. One Massachusetts contact said that even with slower sales, he expects 2006 to be among the top five years all time for residential real estate.
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