BOSTON — Sales of single-family homes in Massachusetts fell in May when compared with this time a year ago, while median prices continue to soar in the Bay State, according to a report releases last week.
Sales dropped almost 10 percent when compared with May 2013, but median prices jumped 7 percent to nearly $348,000, according to the Massachusetts Association of Realtors. This marked the fourth consecutive month of year-over-year sales decreases, and the 12th consecutive month of increasing median prices.
The Warren Group, a Boston-based publisher of business data, reported similar data, with a 7 percent year-over-year decrease in sales and a median price increase of almost 5 percent to $340,000.
“Qualified buyers are taking advantage of the still-low interest rates to buy the limited supply of homes available and are pushing prices up,” Realtors’ President Peter Ruffini said.
Warren Group CEO Timothy Warren Jr. says rising prices are a sign of recovery.
“Low inventory and lingering winter weather in March may have depressed the number of sales, but the rising median price tells me that the market is recovering nicely,” he said.
In Westfield, not only have home prices increased, but sales are up too, bucking the statewide trend.
“This year, 25 single family homes sold in May. Last year there were actually 19, so Westfield actually saw an increase in the number of homes sold,” said Ted Cassell of Park Square Realty in Westfield. “The median price went from $188,000 in May of last year versus $223,500 this year, so it definitely jumped up.”
Cassell added that there was a dearth of higher valued homes sold in the city in May, with one being sold for $600,000 and another that went for between $300,000 and $400,000.
“The bulk of the sales continue to be in that $150,000 to $300,000 range,” he said, adding that these numbers fall in line with the state’s average sale price. “If you look at our average sale price, it’s a little higher right now, but that’s your first-time buyer or people looking to make a move up. We’ve definitely seen less activity for those that’re over $350,000.”
Cassell said that the time that homes are spending on the market is also holding steady in the city.
“Last year it was 118 (days) for the month of May, this year it’s 129, so about four months,” he said, adding that pricing a home correctly is everything when selling. “If they come on the market priced right, we’re seeing them go right away and sometimes get multiple offers. But if it’s overpriced, they just sit on the market – people won’t even look at them.
Cassell stated that it’s currently a “tough market to figure out” but that Westfield homes are usually a pretty good sell.
“Westfield is historically a very strong, diverse real-estate market,” he said. “Land area-wise, it’s huge, and only second to Springfield in terms of the volume of real estate transactions. Of course, Springfield is a larger city, but Westfield is always a very desirable community with a lot to offer in a variety of price points.”
The Realtors showed a slight decrease in May-to-May condominium sales while The Warren Group reported a slight increase. Both reported a median price increase of roughly 9 percent.
“Condominiums are the strongest part of the market these days,” Warren said. “The current median price of $320,000 is the highest of any month in history, proving that smaller spaces, care-free maintenance and urban living are popular these days.”
While Park Square doesn’t deal extensively in the condo market, Cassell said that for western Massachusetts, condominiums may soon be en vogue again.
“If you look at Boston, condos are a huge segment of the market, but for us, I would say the market is coming back,” he said. “You really have to look at it complex by complex. In May, three condos sold for the whole city.”
At an average price of $112,000, these three condos sat on the market for an average of six months according to Cassell, who added that three more sales are pending.
“As prices rise for single family homes, I think you’ll see the condos start to rise as well and become more attractive,” he said. “The low interest rates are helping people keep house prices low, so when you look at a condo, you’ve got to factor in a fee, and it affects how much people can borrow.”
“People are sensitive to that, so if they can get a house, a lot of times people do like the idea of a single family home,” he continued. “But as prices go up, people do look more at condos.”
