With inventory lower, properties sell faster

Inventory levels for single-family homes and condominiums in the Boston area are at an all-time low, signaling a shift to stability in the Hub’s housing market.

In Boston proper, real estate inventories are down 17 percent from last year, according to data from Multiple Listing Services Network PIN. In neighborhoods such as Back Bay, South End, the waterfront and Beacon Hill housing inventories are down 10 percent, 19 percent, 36 percent and 36 percent, respectively. These lower inventory levels also accompany fewer days on market — down 12 percent from last year — and median prices that are on the upswing with a 10 percent increase citywide.

Real estate expert cite several factors driving these downtown market trends. The downtown Boston market has not seen any large-scale residential condominium projects since 2007 because funding has been non-existent for the past several years.

According to Yanni Tsipis, a lecturer at the MIT Center for Real Estate and senior vice president at Colliers International, “We are largely through this period of distress. In the downtown market, as existing inventory of newer construction burns off, it appears likely that there will be a build-up of demand for new production and upward pressure on pricing.”

Tsipis also said many of these potential sellers in the downtown market are also “move up” buyers or buyers who move to the newest building or development in the city from their existing one. With construction just beginning on several downtown projects, these “move up” buyers have won’t have any new large-scale buildings to buy into for the next several years.

In cities and towns surrounding Boston there is a similar trend. Cambridge’s housing inventory is at an all-time low of 126 housing units, down 43 percent from last year with a 4 percent decrease of days on market to 110. Arlington’s inventory is down 21 percent from last year and days on market are down 33 percent, from 118 days to 79 days. Inventory in Quincy is down 6 percent, with days on market down 4 percent from last year to 150.

“Massachusetts has not been hard hit as other areas, and the market is stabilized. We don’t have the amount of foreclosure’s the rest of the country has seen,” said Nicolas Retsinas, a senior lecturer in real estate at the Harvard Business School and director emeritus of Harvard University’s Joint Center for Housing Studies.

With regards to the lower inventory levels, Retsinas added, “Sellers have been spooked by the decrease in prices in the past. We are seeing a lag in inventory because of it.”

Strict lending requirements continue to strain the market. “At the moment we are going through a very tight period for credit and we should have more of a demand today given the demographics,” Retsinas said. “We are on the verge of recovery because of the tightened credit.”

Source: http://www.bostonherald.com/business/real_estate/view/20220224with_inventory_lower_properties_sell_faster/srvc=home&position=also