Sherry Street, Berkshire County attractive

Prices for Bay State homes continued to rise despite a slight drop in sales of single-family homes and condominiums in the first quarter of the year.

Condominium prices saw the biggest hike, increasing 19.4 percent across the state from $134,000 to $160,000 during the first three months of the year compared to last year’s first quarter.

In fact, the median sales price for condominiums rose more than 20 percent in half of the state’s 14 counties – Middlesex, Norfolk, Plymouth, Suffolk, Barnstable, Bristol and Dukes – according to sales data compiled by Warren Information Services, a sister company of Banker & Tradesman.

WIS statistics include all closed transactions recorded at registries of deeds statewide – including both Realtor and non-Realtor transactions, such as homes sold directly by owners.

Based on that data, only the Western Massachusetts counties of Franklin and Hampshire saw a drop in condominium prices. In Hampshire County, condominium sales fell more than 30 percent, from 65 in the first quarter last year to 45 this year, while median sales prices decreased 26 percent from $120,769 to $89,000.

Hampden County experienced a 25 percent decline in condominium sales, but prices remained steady, hovering around $72,000.

The first-quarter results are not a surprise to Realtors, who say that in most areas the strong demand and low housing supply are generally keeping prices high. Even though the stock market has weakened and layoffs have been on the rise, Realtors do not foresee any major problems for the real estate industry.

“I cannot see anything dire,” said Lois Williams, senior vice president and residential manager of Coldwell Banker Hunneman in Topsfield. “I think we’re going to have a steady market … Interest rates are great. Buyer demand is there. It might be a little fainter, but it’s there.”

News of higher condominium prices were also no shock to Realtors Bobbie Botticelli and Todd Sandler.

One of the owners of Colonial Manor Realty in Reading, Botticelli said condominiums are becoming a very attractive alternative for young first-time homebuyers who can’t afford single-family homes. And it’s not just young first-time buyers who are drawn to condominiums.

Botticelli and Sandler, owner of Todd Sandler Realtors in Randolph, say condominiums are also being snatched up by empty nesters – people over 50 whose children are grown – who want to trade larger, high-maintenance homes for the convenience of condominium living.

“We don’t have a two-bedroom condo on the market in Reading right now,” said Botticelli. ” As soon as one comes on the market it goes off.”

Botticelli was preparing to show an efficiency, or studio, unit at Colonial Drive Condominiums, an Andover complex of 220-units, to a prospective buyer last week.

But she wasn’t very optimistic that it would still be available.

“It’s probably gone already. They sell within days of going on the market,” she said.

Botticelli said less than two years ago a two-bedroom condominium in the Andover complex could be purchased for about $98,000. Today, the same condominium sells for $140,000.

In Reading, the median sales price for a condominium during the first quarter was $103,000 higher than it was during the same period last year. Condominium prices rose more than 72 percent from $142,000 to $245,000.

In the neighboring towns of Stoneham and Wakefield, condominium prices rose at least 7.5 percent during the first quarter of 2001.

Botticelli said those communities will always see strong home sales because of their convenient location to Boston and New Hampshire and access to major highways. Another major selling point is the strong school systems in those towns, she said.

The number of available condominiums is also “extremely limited” in the South Shore communities Sandler’s real estate company serves.

There were only 13 condominiums available in five towns – Randolph, Canton, Braintree, Holbrook and Avon – when Sandler checked listings last week.

In Stoughton, a community with “tons” of condominiums, there were only seven available, Sandler said.

When condominiums do become available, they tend to stay on the market for less than two weeks before being purchased, he said.

In addition to condominium prices, the median sales price for single-family homes also rose throughout the Bay State, although at a more moderate pace. The median sales price for a single-family home was $200,000, compared to $179,900 during the first three months of 2000.

Sales of single-family homes in the state fell 5.6 percent from 10,267 to 9,688. Condominium sales remained steady, decreasing by only 2 percent. During the first quarter of the year, 4,396 condominiums were sold statewide, compared to 4,486 during last year’s first quarter.

In nearly all of the state’s counties, either sales of single-family homes or condominiums, or both, were down, while prices were up. The only exceptions were Berkshire and Duke counties. In those counties, both prices and sales increased.

“Sales did show a major improvement,” said Sherry Street, broker associate at Day Spring Realtors in Pittsfield, referring to the Berkshires market.

Street said Berkshire County has attracted many second-home buyers who want to vacation there in the summer. The Berkshires also are witnessing a surge of retirees who want to spend winters in Florida and cool summers in Western Massachusetts.

“That’s a big trend right now,” said Street.

And first-time homebuyers are finding Berkshire County more affordable and a “great place to live,” she said.

“It’s quite unique in that you can be in the city of Pittsfield and within 20 minutes you can be right in the middle of the country,” Street said.

Market Nuances
While prices continue to rise, Realtors in some communities said they are seeing more home listings. Realtors say the bigger supply will lead to a stabilization of home prices, but they don’t predict that home prices will drop significantly.

With more homes on the market, Realtors will have to become more “judicious” about how they price homes and must educate sellers about the “nuances of the market,” said Coldwell Banker’s Williams.

Williams, who is the Northeast regional manager for the Massachusetts Association of Realtors, said she has already begun to see more listings in Topsfield, Middleton, Rowley, Georgetown and Boxford.

“In Topsfield, we have 65 percent more on the market that we did last May,” said Williams.

However, prices have remained steady, said Williams, who adds that she hasn’t seen a home fall to the $200,000 range for years.

In Topsfield, the median price for single-family homes and condominiums was $18,000 lower this first quarter than last year. Last year, a total of 20 single-family homes and condominiums were sold in the town during the first three months of the year, drawing a median price of $328,500. This year, 14 homes sold with a median sales price of $311,500.

Sandler said the housing supply is not likely to catch up with demand in the near future, particularly not in the Greater Boston area where buildable land is scarce.

“There are fewer and fewer new units coming on the market,” Sandler said.

The North Shore also has its share of supply woes. In Reading, Botticelli said she had the lowest number of homes on the market during this past first quarter, but she predicts the trend will reverse during the next few months.

On a national level, sales of existing single-family homes and condominiums rose by double-digit rates in 13 states during the first quarter of the year, compared to the same period last year, according to the National Association of Realtors.

On the other hand, 15 states reported a decline in the resale rate, while the remaining states reported little or no change.

Home prices in most metropolitan areas continued to show moderate to strong gains. Boston and more than 30 other major cities experienced double-digit increases in median prices for existing homes this first quarter, according to NAR.

Prices jumped in two other major Bay State cities, according to WIS data. In Worcester, prices for single-family homes and condominiums spiked 16.3 percent from $110,000 to $128,000, and in Springfield, prices rose almost 16 percent during the first quarter from $69,000 to $80,000.

State’s Condos See 20 Percent Price Hike

by Banker & Tradesman time to read: 5 min
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