The numbers are in, and as expected, 2015 was the best year for home sales in nearly a decade. Prices are up, the number of sales is up and the number of first-time buyers continues to climb.
According to data from The Warren Group, publisher of Banker & Tradesman, several towns and cities in the state have already surpassed their 2005 peak prices, while others have yet to achieve even 80 percent of that bellwether year. Most lie somewhere in the middle. Assessments are climbing and so is equity, resetting the music for that old dance of trading up and freeing up entry-level homes – just in time for the leading edge of the next generation’s expanding housing requirements.
Massachusetts’ stellar year was not replicated across the country, however. Nationwide the market is considered healthy, though pockets still decimated by the recession continue to struggle. Many local markets cooled considerably last year as a combination of factors came together to flood the market with inventory and reduce prices. It was a different year altogether in our neighboring state of Connecticut, where every month the number of sales climbed – while prices took a dive.
As they say in the biz, it’s all about location, location, location. Particularly in Greater Boston, a generally wealthy area that didn’t fall as far and had an easier slope to climb, the recovery has been nothing short of remarkable. An influx of well-paying biotech and life science jobs has certainly contributed to the continued growth, as have a wealth of successful startups.
Despite the restless natives complaining forever and endlessly (although rightfully so) of high taxes, poor infrastructure and a host of other slights, it seems Massachusetts is a place where people want to live.
It’s really a shame there’s nowhere for them to do so.
There are exceptions, of course, but on the whole, our housing stock is old, expensive and there’s not much of it. The rents are skyrocketing. A furious burst of condo development may alleviate some of the strain, but only for the upper end of the market.
Therein lies the rub. Oh yes, there are certainly newer houses for sale in the desirable suburbs, with good schools and an easy commute. There are condos available right in the heart of downtown. There are beautiful apartments available for rent all over the city. But they are increasingly, rapidly, out of the reach of many of the area’s residents.
The cost of living in the immediate Boston area and within the city itself is one of the highest in the nation. Coupling that with young workers who graduated from college in the teeth of a recession with the highest rate of student loan debt this country has ever seen yields a population increasingly pushed to the margins. What, then, will become of those who are already on the margins? When luxury apartments are leasing in Chelsea, where will future affordability be found?
No, say economists, we’re not in a bubble – not yet. But we see all the hallmarks of one forming.
